Review of The Wisdom of Finance

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Rating

9 Overall

9 Applicability

8 Innovation

9 Style


Review

Finance keeps the wheels of the economy turning, but it gets a bad rap in the popular imagination. The 2008 crisis magnified that perception, when it emerged that Wall Street professionals were taking on excessive risk to enrich themselves without regard to the societal consequences. 

But professor Mihir A. Desai’s nuanced perspective of the field’s socially useful functions makes it clear that finance is a double-edge sword. In this sweeping, thought-provoking look at money and human endeavor, he illustrates the concepts of finance and applies them to everyday situations, drawing on literary and historical examples as well as his own experiences. Though some of the parallels that Desai draws between finance and life may seem a bit labored, you will find yourself nodding in agreement with most of his perceptive observations. He invites readers to open their minds and draw new insights from “the wisdom of finance.” He explains how people can use financial tenets to improve their lives, and he illuminates the field overall, making this a worthwhile addition to your library for understanding economics in personal terms and in its broader context.   

About the Author

Mihir A. Desai is a political economist and professor at Harvard Business School and Harvard Law School.

 

Finance as the Villain

Professor Desai points out that, in spite of all the ways in which people apply the basic principles of finance to their daily lives, the subject of finance draws consistently negative reactions around the world. Stories abound in literature and the arts about short-sighted, callous and grasping characters in the financial world.

For instance, Desai relates Leo Tolstoy’s tale about Pakhom the peasant’s effective use of financing to secure real estate and enrich himself to show how greed – goaded by the Devil – made Pakhom’s desire for even more land the cause of his death. The infamous banker Gordon Gekko in the film Wall Street is also cast as a modern-day villain, extolling the virtues of avarice. 


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