Can we be rational about money?
Morgan Housel’s Psychology of Money builds on research that financial decision-making is rooted in emotion rather than reason
About a year or so when I travelled back to India, it was clear that Morgan Housel’s Psychology of Money was the no.1 national best-seller in the country. While foreign self-help books are perennial popular sellers in India, the scale of its success exceeded even peak Harry Potter mania. I saw airport stalls where Housel’s book was given three shelves or more with cartons lying around waiting for quick re-stocking. It even made the ultimate Indian literary short-list: the street stop book-hawker’s arms.
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The popularity of Housel’s book in India sits as a parallel adjunct to an obsession with startups. It is a mild understatement to say that India has properly woken up from its closed economy decades and properly hooked to capitalism. The tech startup is the ultimate Indian success fantasy. The remaining shelf space not taken up by The Psychology of Money is devoted substantially to start up culture, whether entrepreneur memoirs or how-tos. A hit TV show is a localised version of Dragon’s Den called “Shark Tank”. The show has made its judges — young and successful entrepreneurs (some, of course, “nepobabies”)— celebrities and household names. One of the judges on the show, who has an aggressive and abrasive personality, is permanently in the news embroiled in some beef or the other. He is being sued by his startup for embezzlement.
In Mihir Sharma’s Restart: The Last Chance For the Indian Economy (2015), quotes a conversation between Nandan Nilekani (a member of the OG tech startup billionaire club and government adviser) and Raghuram Rajan (former Governor of the Reserve Bank of India and professor at the University of Chicago’s Booth School of Business) about the troubling nature of Indian aspiration. In this conversation, Rajan told Nilekani that he was concerned that “the Horatio Alger story” was not yet part of India’s popular imagination.