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Grand Pursuit: The Story of Economic Genius. By Sylvia Nasar.

In an essay in his popular magazine, Household Words, Charles Dickens issued a challenge to economists to humanise their discipline. “Political economy is a mere skeleton unless it has a little human covering and filling out,” he wrote in the inaugural issue in 1854. “A little human bloom upon it, and a little human warmth in it.”

This is a challenge to which economics and economists have mostly failed to rise. In her new book Sylvia Nasar, a former economics correspondent at the New York Times and now at Columbia University, has at least gone part of the way to satisfying Dickens's wishes. “Grand Pursuit” is a history of economics which is full of flesh, bloom and warmth. The author demonstrates that there is far more to economics than Thomas Carlyle's “dismal science”. And she does so with all the style and panache that you would expect from the author of the 1998 bestseller, “A Beautiful Mind”, about John Forbes Nash, the tortured genius behind game theory.

It turns out that economists—or at least the handful of geniuses that Ms Nasar discusses—are a peculiarly interesting bunch. John Maynard Keynes was an exotic mixture of Bloomsbury intellectual and civil-servant mandarin with a touch of Puck thrown in. Joseph Schumpeter was an obsessive scholar who spent his spare moments riding thoroughbreds, collecting mistresses and, on the odd occasion, taking part in orgies. Irving Fisher, the Yale economist who declared, in October 1929, that stocks had reached “what looks like a permanently high plateau”, was a health nut and prohibitionist. Joan Robinson, whom Schumpeter dubbed “one of our best men”, wore Mao suits and pronounced that North Korea was bound to outperform the South.

Ms Nasar's story is made all the more appealing by the fact that she does almost nothing to conceal her prejudices. She has little time for Karl Marx, a man who was so convinced of his rightness, and so buried in his books in the British Library, that he failed to observe the world around him. He did not bother to visit a single British factory. He refused to exchange a word with the intellectual titans of the time, including Charles Darwin and George Eliot, both of whom lived just a few miles from his front door. He ignored overwhelming statistical evidence that the working class's share of the nation's wealth was increasing. By contrast, Alfred Marshall was everything that Marx was not: the embodiment of all that was best in Victorian high- mindedness. Marshall was alive to what was going on around him. He frequently visited factories and firms, and travelled around the world's new “empire of energy”, the United States. He threw his weight behind popular education and incremental reform.

In lesser hands Ms Nasar's story might have degenerated into a series of pen portraits: tittle-tattle for the middlebrow. But she unifies her account with a series of big questions. How, for example, did humanity escape from the grinding poverty that has been its lot through most of human history? Why was a static society replaced by a dynamic one? And how best to cope with the booms and busts that have been capitalism's peculiar contribution to human life?

In Marx's view the capitalist system, for all its ability to unleash productive power, was haunted by a contradiction: the drive to increase profits would immiserate the poor and lead to crises of overproduction. But Marshall demonstrated that capitalism advances not by immiserating the poor, but by boosting productivity. Factory owners make relentless small improvements that allow them to produce both higher wages and lower prices, thereby spreading the gains of material progress throughout society. Schumpeter further expanded the idea of productivity increases. The economy doesn't simply get bigger and bigger. It goes through a constant process of discombobulation as entrepreneurs invent new products and processes. Marx got it upside down: capitalism's recurrent crises actually make it stronger.

Economics was a practical as well as an analytical science. From the left, Beatrice Potter Webb argued that mass destitution could be cured by “the household state”. Fisher showed that good management of the money supply could contribute to stability. Keynes insisted that crises could be prevented if the government could act as the spender of last resort, just as the central bank was lender of last resort.

“Grand Pursuit” peters out at the end. It is easy to see why Ms Nasar thought Amartya Sen might be the right terminus for her train. He is an economic genius who has devoted his life to thinking about the elimination of the most dramatic form of want: famine. But it is, nevertheless, odd to end a history of economics without discussing the financial crisis of 2007-08 and the furious arguments it has engendered within the economics profession. Surely the likes of Paul Krugman and Lawrence Summers should have had at least a walk-on role at the close of the story. But that is a blemish in what is generally a wonderful book. “Grand Pursuit” deserves a place not only in every economist's study but also on every serious reader's bedside table.