The Price of Everything
Solving the Mystery of Why We Pay What We Do
By: Eduardo Porter
Published: January 4, 2011
Format: Hardcover, 304 pages
ISBN-10: 1591843626
ISBN-13: 978-1591843627
Publisher: Portfolio/Penguin
"Every choice we make is shaped by the prices of the options laid out before us - what we assess to be their relative costs - measured up against their benefits", writes New York Times editorial board member, and commentator specializing in business, regulation, trade and international economic relations, Eduardo Porter in his fascinating and insightful book The Price of Everything: Solving the Mystery of Why We Pay What We Do. The author describes how prices affect peoples' decisions and lives, and how a deeper understanding of the importance and influence of prices, can help people make better choices.
Eduardo Porter takes the reader on a guided tour of the world, and how prices affect peoples' lives in very different ways. From the value of garbage in India, to the price of human kidneys on the open market, to the various ways that weddings are financed, the author presents a lively overview of the costs and benefits of individual decisions. Whether the choice is as deceptively mundane as the price of work, to more philosophical discussions including price of happiness or a human life, Eduardo Porter recognizes that a price point can be discovered for the value. Even the seemingly free item or service has a price and a value. Throughout the book, Eduardo Porter demonstrates that goods, services, and even ideas, have a wide range of values to different people, in a variety of places. As the author points out, even the future has a price.
Eduardo Porter (photo left) recognizes that the old adage that everything has a price is true in both a theoretical and literal sense. Even the very concept of what people consider to be change in the culture, is related to how people adapt to changing prices. Different times and cultures place different values on the tangible and the unseen, and that variation is reflected in the price. Prices shape, not only how people shop and influence what they buy, but prices have an effect on how people make daily decisions in general. The choices may be as small as deciding which coffee to purchase, to life changing decisions to get married or have children. The concept of a cost-benefit analysis takes place in every decision made in life. The calculation may be conscious, or completely in the subconscious mind. The important thing, is that price consideration is part of the thought process. In other words, for Eduardo Porter, prices rule our lives in both explicit and implicit ways.
For me, the power of the book is how Eduardo Porter describes both the hidden and obvious influence of prices on the everyday and long term decision making process. The author provides both a theoretical framework to show the impact of prices, and the multitude of ways that they influence both individuals and very large groups of people. Eduardo Porter adds many interesting examples of pricing in action, including at the daily choice level, and at the more esoteric values level. Even the concept of free takes on a price value in this tremendous study of prices. The societal effects of prices are both subtle and profound, and pricing can even alter social behavior in unexpected ways. A
Eduardo Porter includes an important chapter on how prices can also fail to deliver on their promise. As with the price itself, the failure of prices also creates a profound influence on human behavior and activity. The author, while reflecting on the influence of prices, doesn't subscribe to the idea of rational economy theory. The rational theory of selfish self interest, and always rational behavior on the part of people is discarded for a deeper and more profound concept. The author seeks a more holistic economic model where values and prices are not determined entirely by selfishness, but through deeper behavioral and psychological processes. Overall, the author's multi-disciplinary idea is more realistic, and closer to the way people actually express preferences and make decisions than the sterile and discredited rational market theory.
I highly recommend the very engaging landmark book The Price of Everything: Solving the Mystery of Why We Pay What We Do by Eduardo Porter, to anyone seeking an entertaining and profound examination of the role that price plays in everyone's decision making process. The assessment of price and value may be explicit, or it may be hidden deep within the subconscious mind, but it influences the way we act and behave as individuals and as entire societies.
Read the important and fresh thinking filled book The Price of Everything: Solving the Mystery of Why We Pay What We Do by Eduardo Porter, and discover how prices influence your daily life, and your long term decision making process. You will never look at prices and your personal preferences in the same way again.
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