Bernanke book on Depression rides sales surge
— -- The financial crisis has made Federal Reserve Chairman Ben Bernanke's book Essays on the Great Depression a hot seller — at least by academic standards.
Princeton University Press has sold more than 700 copies, including 71 on Friday, since the financial crisis began, says sales director Eric Rohmann. The book sold only a few hundred copies when the paperback edition was published in 2004. Academic books are considered a success if they sell 1,000 copies, Rohmann says. "This is an unusual situation. People are buying a very technical book."
Bernanke, a former Princeton University economist, is considered the pre-eminent living scholar of the Great Depression. He is practicing today what he preached in his book: Flood the system with money to avoid a depression.
Bernanke says he is fascinated with the Depression's tragic characters, including "hapless policymakers trying to make sense of events for which their experience had not prepared them."
"To understand the Great Depression is the Holy Grail of macroeconomics" is the first sentence of Chapter 1.
Boston University economic historian Robert Margo says Bernanke is now doing what he believes should have been done early in the Great Depression, which started in 1929 and lasted a decade. In a nutshell, that means doing everything possible to end the credit crunch.
"Concerns about inflation and everything else go out the window," Margo says.
This strategy was developed over decades by Milton Friedman, Bernanke and other economists. "There's still debate over what caused the Depression. But there's consensus over what should have been done," Margo says.
Bernanke made his name comparing how different countries and industries responded to the Great Depression. He blamed the Depression's severity and length on poorly managed money supply worldwide.
He now finds himself in the odd position of putting his academic theories to work, like a Civil War historian who gets to refight old battles.
"He doesn't want his epitaph to read 'another hapless policymaker,' " Margo says.
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