The Wisdom of Ants: A Short History of Economics by Shankar Jaganathan; Westland Tranquebar; Price: Rs.295; 366 pp This is a truly extraordinary book — a disciplined effort of scholarship and research written in an engaging style — which all individuals interested in the complex and often confusing subject that is economics, should read. The chief merit of The Wisdom of Ants, who according to the famous fable, worked industriously and saved while the neigbouring grasshoppers’ community sang and danced the summer away only to suffer grievously in winter, is that it provides a valuable, easily comprehensible historical overview of the now dominant social science known as economics. Contrary to popular belief, economics was accepted as a social science less than 250 years ago when the famous British economist Adam Smith wrote his landmark An Inquiry into the Nature and Causes of the Wealth of Nations in 1776. The heart of this scholarly book distinguished by its wide sweep, is the 112-page focus on ‘A Short Biography of Economics’. Tracing the birth and evolution of this science over the period 400 BCE (before Christ era formerly BC) to 2009, the author divides this long time span into four periods. The first era from 400 BCE to 1500 CE (formerly AD), constitutes the “long infancy” of economics, when it was “ethically immersed” and heavily influenced by religious precepts and practice. During this period, private property became acceptable “but social consent for self-centred individualistic behaviour was not yet conceded”. In this chapter the views on commerce of great thinkers and philosophers of the 14th century are detailed. The perspectives of Aristotle, Xenophon, author of Oikonomia (translation: The Economist), Kautilya, Chinese philosopher-statesman Lord Shang, and professor, principal and judge Muhammad Ibn Khaldun on business and trade are presented. The next epoch in the evolution of this social science, observes Jaganathan, was the period 1300-1776, described as the “brief childhood of economics” when it was “socially shackled” by Christian doctrine and dogma in Europe, whose hitherto backward nations transformed into dominant global powers. In the author’s view, the Black Death plague that swept across Europe between 1348-50 wiping out a quarter of the continent’s population almost overnight, created a shortage of labour “which resulted in a shift in the rural workforce from serfdom to paid labour”, thus raising standards of living and promoting “the gradual shift, even in the rural economy, away from the barter system to money-based exchanges”. Simultaneously, a growing number of people began to understand that the series of epidemics that caused perhaps the greatest demographic disaster in human history, was not the consequence of divine displeasure, but of the neglect of sanitation and hygiene. “Logical decisions started to displace faith and authority, which had hitherto ruled the day, in a small way. In commercial life, it emerged in the concept of prudent economic reason,” writes Jaganathan. Economics flowered into an academic subject under the formative influence of Adam Smith who penned his watershed The Wealth of Nations in 1776. The era…
