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29 May 2012

Book Review: First Principles by John Taylor

First Principles: Five Keys to Restoring America's ProsperityFirst Principles: Five Keys to Restoring America's Prosperity by John B. Taylor
My rating: 4 of 5 stars

John Taylor, a Stanford economics professor, outlines five core economic principles that have been the core of American success in the past.  The five principles: predictable policy framework, rule of law, strong incentives, reliance on markets, and clearly limited role for government have also been key to the rise in many of the emerging markets in recent years.  I found Mr. Taylor's historical anecdotes to be compelling, although I would imagine there are plenty who would view his interpretation as biased by his philosophy, but that is the nature of policy prescription.  You have to try to make the most persuasive case for your ideas and using historical events to support your case will always be criticized by those who view history differently.  I don't know that there is really any way around that.

My own philosophy biases heavily toward human liberty and so I found Mr. Taylor's book compelling and the five principles as great guidepost to policy decisions.  I have a less favorable opinion of the role of the Federal Reserve than Mr. Taylor does, but that is a difference of opinion I can live with.

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