Tomáš Sedláček interview
The bright star of Czech economics
Posted: August 17, 2011
The newly translated English version of Sedláček's 2009 Czech best-seller has brought international attention to the young economist and presidential adviser, who is already well known in his homeland.
Tomáš Sedláček has a lot on his plate. At just 34 years of age, the Prague native is one of the Czech Republic's brightest economists, with stints as chief macroeconomic strategist at ČSOB, a member of the National Economic Council, a Yale University Fellow and economic adviser to President Václav Havel under his belt. But Sedláček hasn't stopped there; most recently, he has taken on a new role: that of best-selling author.
Economics of Good and Evil, which Sedláček wrote as part of his thesis at Charles University's Institute of Economic Studies, became a Czech best-seller upon its release in 2009, in part because of Sedláček's unique approach to the science of economics, which combines literature, religion and philosophy. After two years working on an English translation, Sedláček has published a new edition with Oxford University Press. The young author and economist recently sat down with The Prague Post to discuss his career and the Czech economy.
The Prague Post: What inspired you to focus on the development of economics through literary, philosophical and religious texts?
Tomáš Sedláček: Well, they teach us and challenge us to think outside of the box and try to come up with new insights. We each have our own method of doing this, and my method was to look back into history and read the ancient texts with a modern understanding. What would the authors of the Old Testament and The Epic of Gilgamesh as well as Descartes and Adam Smith think of the way the economy has developed? Would they be happy with it? What would surprise them? What would shock them? What would be something that they're acquainted with? This was my method of thinking outside of the box about current economics by looking back at history in unlikely texts.
TPP: What were the initial reactions when you submitted this work as part of your thesis in school?
TS: Well, this is somewhat strange - I wrote the thesis under the guidance of Professor Sojka, my tutor, who has passed away. He was one of the greatest masters of economic thought, philosophy and methodology. He was very happy and impressed with the work, which he recommended. The custom in the Czech Republic is to have three opponents look over the work, and they all gave positive reviews and critiques. Two of them were very positive reviews; the third gave a few remarks that could have been solved within a month or less. Yet, for some strange reason, it wasn't accepted by some of my academic colleagues. In the meantime, Oxford University Press got interested and published the book, so this is sort of my answer to that.
TPP: What are the reactions now that the book has become a Czech best-seller and is now being released in Anglophone markets?
TS: So far, the reactions from the international scene have been very good. The Washington Post recommended the book as one of the five economic books for summer and beyond. There's been a very positive review in The Financial Times. One also came out in The New York Times and one academic and very encouraging one by the Economic History Association. Also, there are already 27 reviews of the book by customers on Amazon - so this is a lot, I think, considering the book just came out a couple of weeks ago.
I just came from a book tour in the UK, where I had the honor of presenting and debating the book at the Royal Society of Arts, Cambridge, Oxford and even at the House of Commons as a guest of Henry Jackson Society. All the events went well, a lot of people attended, and I enjoyed the debates very much.
TPP: Was the economic crisis of 2007-09 something that could have been prevented, and if so, in what ways does the book address this?
TS: I'm not sure the crisis could have been prevented, but we now know, from the benefit of hindsight, all the things that were wrong, and it's still quite difficult to remedy them. There are fundamental issues such as the overconfident reliance on mathematical models, and trying to pretend that uncertainty doesn't exist, and so forth. What we did was to completely exploit our debt reserves in good times; we went on the edge of how much a country could borrow, and so we used something that was meant to be used only during bad times, giving energy to the economy by pumping money into it in the form of new debt. So, the crisis that surprised us found us like a thief in the night, and we were not ready for it.
This is the birth pain of realizing that we cannot live on debt forever. You can live on debt for a little while, and then you have to repay it. We could have done better in having bigger fiscal surpluses or lower debt, and then we could have used that money to cushion the impacts of the crisis. This is something I've been writing about for many years. The book is the result of eight or nine years of study. It is not tailor-made for the economic crisis, but it seems to be useful because it addresses questions that are now being addressed by the general public.
Economics of Good and Evil is available in Prague at Oxford Bookshop and Shakespeare and Sons, and in Brno at Oxford Bookshop.
Scott J. Nixon can be reached at
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