The Sunday Times
Reviewed by DAVID SMITH
THE UNDERCOVER ECONOMIST by Tim Harford
Little, Brown £17.99 pp288
The question why a cup of coffee costs so much has engaged philosophers and pundits, particularly in America, for years. How did Starbucks get people to pay $2 for something they were used to paying 25 and 50 cents for? The answer, of course, has implications beyond caffeine. Without the $2 cup of coffee there would not be a Starbucks (and similar coffee chains) in every town and mall in America. And without that, it is doubtful the coffee phenomenon would have spread to Britain and around the world.
Tim Harford, in his entertaining application of economic principles to everyday life, takes us back to David Ricardo, the great English classical economist, to explain coffee prices.