Book Bits | 5.26.2012

The New Geography of Jobs
By Enrico Bonetti
Q&A with author via Forbes
Q: What is the New Geography of Jobs?
A: If you look at the economic map of America today, you do not see just one country. You see three increasingly different countries. On one hand there are cities like Seattle, San Francisco, Raleigh-Durham or Austin, with a strong innovation-based economy and workers who are among the most creative and best paid on the planet. At the other extreme are former manufacturing centers like Detroit, Flint or Cleveland, where jobs and salaries are plummeting. In the middle, there is the rest of America, apparently undecided on which direction to take.The difference between the three Americas was small in the 1980’s and has been growing ever since. My book explores this new geography of jobs, and especially its root causes and what it means for our country.

The Politics of Poverty Reduction
By Paul Mosley
Summary via publisher, Oxford University Press
Globally, there is a commitment to eliminate poverty; and yet the politics that have caused anti-poverty policies to succeed in some countries and to fail in others have been little studied. The Politics of Poverty Reduction focuses on these political processes. Analysis is based partly on global comparisons and partly on case-studies of nine countries that span the developing world. Where governments are politically weak, they need to make alliances with other groups to stay in power, and where these have been with low-income groups, the result may be a lasting and effective pro-poor strategy. Often pro-poor policies have been brought in not with progressive intentions, but out of fear that the state will fall apart unless pro-poor elements are incorporated into government, and the most effective regimes in reducing poverty have seldom been the kindest and most benevolent.
The Small Worlds of Corporate Governance
Edited by Bruce Kogut
Summary via publisher, MIT Press
The financial crisis of 2008 laid bare the hidden network of relationships in corporate governance: who owes what to whom, who will stand by whom in times of crisis, what governs the provision of credit when no one seems to have credit. This book maps the influence of these types of economic and social networks–communities of agents (people or firms) and the ties among them–on corporate behavior and governance. The empirically rich studies in the book are largely concerned with mechanisms for the emergence of governance networks rather than with what determines the best outcomes. The chapters identify “structural breaks”–privatization, for example, or globalization–and assess why powerful actors across countries behaved similarly or differently in terms of network properties and corporate governance.
The Large-Cap Portfolio: Value Investing and the Hidden Opportunity in Big Company Stocks
By Thomas Villalta
Summary via publisher, Bloomberg Financial/Wiley
Large-Cap is an abbreviation of the term “large market capitalization” and refers to the stock of publicly traded companies with market capitalization values of roughly more than $10 billion, like Walmart, Microsoft, and Ford. Because of their size, the conventional view is that these companies do not present investors with an ability to be opportunistic. The Large-Cap Portfolio + Website argues that, contrary to popular perceptions, significant opportunities exist in these stocks. Written with a fluency that both the savvy amateur and professional investor will understand, the book fills a void in the market by offering the practitioner a methodology to identify and approach the major assumptions that underlie valuation, with an emphasis on issues that are more relevant to the analysis of large-cap stocks.
Investment Theory and Risk Management
By Steven Peterson
Summary via publisher, Wiley
Investment Theory and Risk Management is a practical guide to today’s investment environment. The book’s sophisticated quantitative methods are examined by an author who uses these methods at the Virginia Retirement System and teaches them at the Virginia Commonwealth University. In addition to showing how investment performance can be evaluated, using Jensen’s Alpha, Sharpe’s Ratio, and DDM, he delves into four types of optimal portfolios (one that is fully invested, one with targeted returns, another with no short sales, and one with capped investment allocations). In addition, the book provides valuable insights on risk, and topics such as anomalies, factor models, and active portfolio management. Other chapters focus on private equity, structured credit, optimal rebalancing, data problems, and Monte Carlo simulation.
Objective Economics: How Ayn Rand’s Philosophy Changes Everything About Economics
By M. Northrup Buechner
Review via Capitalism Magazine
To the best of my knowledge, this book represents the first attempt to rewrite economics in the light of Ayn Rand’s philosophy of Objectivism. As such, it is an application of Objectivism to the theory of how a free economy works, that is, to the theory of how men’s independent, self-interested actions to produce and exchange economic values are integrated into an economic system. Ayn Rand did not leave us a new economics, but something much more important—a philosophical foundation for all the special sciences. My purpose is not to present the Objectivist philosophy, but to apply Objectivism to economics. For an authoritative account of Objectivism, there is no substitute for Ayn Rand’s own writings.