Rating: 
Summary: Knowledge can be costly...
Review: This is indeed one of Sowell's tomes. Knowledge costs are different for different people. Some knowledge is extremely costly to acquire in both time and money. Articulation may not be an expression of knowledge, but a talent for using words; however, some incorrectly think that if someone has good articulation, then he must know what he is speaking of. Sometimes the most important decision to be made is WHO is to make a decision. The further away from the knowledge on which the decision must be based the "decider" is, the less informaiton he has and he is more likely to make an incorrect decision. This explains the folly of most regulation: generally speaking, regulators cannot know what it is they are regulating. Shocking as this might be, but it takes sometimes years - maybe decades - for one person to gain knowledge in some areas of patient treatment, but yet people in the FDA regulate the medical industry anyway with the total impossibility of them ever knowing even a fraction of a percentage of what they are regulating! Of course, this is not unique to the medical field, but applies to all fields - regulators are too far away from the correct KNOWLEDGE to make some types of decisions. This fact of knowledge is inescapable, permanent, and nobody can change it. Sowell also shows the effects of insurgent movements on social policy and how the movements still exist long after they have outlived their usefulness - beyond their point of diminishing returns. He also shows how the courts really screwed up the judicial system by crusading for social causes instead of interpreting the constitution. In the quest for "solving" problems, many social insurgent groups forget that some problems will never be solved and we just have to live with the necessary trade-offs such situations present to us - some of these groups forget that their "solutions" create other problems that they did not forsee. They forgot that life's problems is weighing trade-offs and some "solutions" replace one problem with another. The theme, for the most part, is coming to terms with a fact of life: we must decide what trade-offs we want to live with. We cannot perfectly manage all of the information out there, and some of the information is too costly to get for some people. We must balance what we know against the chances of what we do not know. Much is left to chance and that is life.
Rating: 
Summary: Another Must-Read From Thomas Sowell
Review: Thomas Sowell has called "Knowledge & Decisions" his "most important and comprehensive work." After completing the book, it nearly impossible to disagree. There are two themes in Mr. Sowell's book. First, knowledge is not a "free good." Knowledge has a cost that isn't universally shared. This truth has important implications. In Mr. Sowell's opinion, capitalism uses knowledge more efficiently and directly than other economic systems. Unfortunately, the link between knowledge and capitalism is also a great political vulnerability. The public can get the economic benefits of capitalism without understanding the economic process. Politicians can exploit economic shortcomings into attacks on the economic process. Every perceived problem - whatever its reality - calls for a political "solution." These political "solutions," however, always give power to those who are removed from the knowledge and feedback mechanisms that undergird real "solutions." Not long ago, for example, the First Lady entrusted herself to radically reform the nation's health care industry. The fact she had no medical training or hadn't even run a drugstore didn't keep her efforts from nearly succeeding. Let us now understand Sowell's second conclusion: When making decisions, the question "who makes the decisions?" is just as important as what gets decided. Most discussion of various issues - from education to health care - overlooks the crucial fact that the most basic decision is WHO makes the decision, under what constraints, and subject to what feedback mechanisms. The great strength of the American Constitution is its system of "checks and balances" and "separation of powers." Here, decisions are made by scores of actors who check each others' ambition. This is different from stating that better decisions will be made when we replace "the bad guys" with "the good guys." When citizens choose to leave power in fewer and fewer hands and then have that power wielded by men who are further and further removed from real life, they are paving the road to despotism. Every citizen wants a better school system for their kids and a better health care system for their parents. But who will wield this power? Washington or local school boards? Who has more expertise on life-or-death matters? Bureaucrats or doctors? Constitutional democracy is a new - and indeed, fragile - form of government. As citizens who lived under Hitler's Germany or Peron's Argentina can attest to, it is easy to give up freedom and hard to get it back. In the second half of Mr. Sowell's book, he documents some disturbing trends in law and politics. These trends run contrary to the two points of Mr. Sowell's book. First published in 1980, there has been a lot of good news since then. Voters are starting to understand the costs of knowledge and the limits of political decision-making. But there is always the temptation to go back to the past. Mr. Sowell's book is an excellent lesson in why we must never travel that path again.
Rating:
Summary: Another Must-Read From Thomas Sowell
Review: Thomas Sowell has called "Knowledge & Decisions" his "most important and comprehensive work." After completing the book, it nearly impossible to disagree. There are two themes in Mr. Sowell's book. First, knowledge is not a "free good." Knowledge has a cost that isn't universally shared. This truth has important implications. In Mr. Sowell's opinion, capitalism uses knowledge more efficiently and directly than other economic systems. Unfortunately, the link between knowledge and capitalism is also a great political vulnerability. The public can get the economic benefits of capitalism without understanding the economic process. Politicians can exploit economic shortcomings into attacks on the economic process. Every perceived problem - whatever its reality - calls for a political "solution." These political "solutions," however, always give power to those who are removed from the knowledge and feedback mechanisms that undergird real "solutions." Not long ago, for example, the First Lady entrusted herself to radically reform the nation's health care industry. The fact she had no medical training or hadn't even run a drugstore didn't keep her efforts from nearly succeeding. Let us now understand Sowell's second conclusion: When making decisions, the question "who makes the decisions?" is just as important as what gets decided. Most discussion of various issues - from education to health care - overlooks the crucial fact that the most basic decision is WHO makes the decision, under what constraints, and subject to what feedback mechanisms. The great strength of the American Constitution is its system of "checks and balances" and "separation of powers." Here, decisions are made by scores of actors who check each others' ambition. This is different from stating that better decisions will be made when we replace "the bad guys" with "the good guys." When citizens choose to leave power in fewer and fewer hands and then have that power wielded by men who are further and further removed from real life, they are paving the road to despotism. Every citizen wants a better school system for their kids and a better health care system for their parents. But who will wield this power? Washington or local school boards? Who has more expertise on life-or-death matters? Bureaucrats or doctors? Constitutional democracy is a new - and indeed, fragile - form of government. As citizens who lived under Hitler's Germany or Peron's Argentina can attest to, it is easy to give up freedom and hard to get it back. In the second half of Mr. Sowell's book, he documents some disturbing trends in law and politics. These trends run contrary to the two points of Mr. Sowell's book. First published in 1980, there has been a lot of good news since then. Voters are starting to understand the costs of knowledge and the limits of political decision-making. But there is always the temptation to go back to the past. Mr. Sowell's book is an excellent lesson in why we must never travel that path again.
Rating:
Summary: Quieten the confusion...
Review: Thomas Sowell is a masterful economist and social theorist, and this may be his greatest work. Sowell expertly links the two broad topics of decision making and knowledge in a highly expansive way. This book was published in 1980, but is a much stronger treatment of the role of knowledge (and learning) than many of the more recent, highly confused works on knowledge management. This book is quite heavy reading, and is most appropriate for business knowledge strategists, etc. Much of the book addresses governmental policy issues related to decisions and knowledge, and therefore is also highly relevant to policy makers.
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