I approached this book as a ‘should read’ rather than a ‘want to read’, as my knowledge of economics is sketchy. Yet after the first few chapters I was engaged by the content and looking forward to learning more. New Zealand author Liam Dann does a terrific job of clarifying key terms and theories. Although I’m still unlikely to initiate conversations about economics at social events, I’m more confident now in my ability to understand news headlines and forecasts. BBQ Economics also prompts consideration of whose “rumours, stories and narratives” are influencing our perception of the economic world.
Dann is upfront that he is a business journalist, not an economist. He has a deep curiosity about money – “what it is, why it matters, how it works and what it might be about to do next”. BBQ Economics addresses the first three questions, although the final question is a challenge. What money “might” do is anyone’s guess, and Dann highlights the tension between over-confidence and inaction. “You won’t get rich unless you take risks,” he says. Chapter 16 – How worried do you want to be? – will help to untangle your approach to risk-taking.
Dann demystifies much of the economic jargon. He reassures us that “There are plenty of economic terms that are just fancy words for things we already say,” such as ‘cut your losses’. He describes economics in action: we fall for the sunk cost fallacy when we watch a bad film all the way to the end. FOMO, suggests Dann, is another way of looking at opportunity cost.
National, international, political and historical impacts on New Zealand’s economy are covered in detail, including the effects of the Covid-19 pandemic. Dann describes how external variables, such as fluctuating prices for our key export products and international banking crises, leave our country vulnerable. Short case studies provide down-to-earth examples of when and how things have gone wrong. And, in the case of the potential hairyberry, what could have gone better.
Dann mentions cryptocurrency, ChatGPT, drones and other technology previously categorised as science fiction. He discusses the enormous potential of AI to contribute to technological progress and potentially to labour shortages as well. He also acknowledges the social disruption associated with AI and the importance of “learn[ing] the right question to ask it”.
Although Gross Domestic Product (GDP) is accepted internationally as an official way to measure a country’s economic growth, Dann emphasises the gaps in what GDP measures. In particular, the lack of recognition of the societal value of work done in the home, such as unpaid caregiving, which is often carried out by women. (See feminist economist Marilyn Waring's book for more on this topic.) Dann argues for a more inclusive economy and outlines why New Zealand should persevere with efforts to address social inequity and poverty.
Dann shares some of his own financial experiences, including a sorry tale about overlooking an opportunity to invest in Xero before the company went public. He explains how he chooses to tackle his mortgage as he “ride[s] the ups and downs of the interest rate market”.
Each chapter is introduced by a proverb or brief quote from politicians, industrialists, philosophers and others. “You can’t live in a stock certificate,” advises Oprah. Quotes from many different sources pop up elsewhere in the book – including Kenny Rogers, Buddha, rapper Biggie, and an anonymous “well-connected fund manager” who correctly predicted the collapse of New Zealand’s finance companies.
Chapter headings, together with a detailed index, make it easy to find relevant content. By necessity, BBQ Economics has formulas, graphs and data, but not enough to make your eyes glaze over. A few more infographics would have been good, such as Dann’s coffee-cup shaped breakdown of each component contributing to the price of takeaway coffee.
It’s a bold move to include an image and a quote from former Prime Ministers Muldoon and Key on the cover – this could attract or deter potential readers. It’s possible that younger readers may think that Key’s quote belongs to the image of the long-gone Muldoon, as the quote and the image sit alongside each other.
Dann encourages the nation to “look under the hood” and this applies to our personal working and spending patterns too. “At its core,” suggests Dann, “personal finance is really just common sense.” BBQ Economics raises the questions that will help readers to apply common sense to their own finances, as well as helping us to understand the broader economic context in which we are making our decisions.
Reviewer: Anne Kerslake Hendricks
Penguin Random House