New books for a new paradigm

A wave of recently-published books could contribute to the emergence of a new economic Leitmotiv.

 

Thomas Piketty‚ ’Capital et Idéologie’, Seuil, September 2019.

Piketty challenges us to revolutionize how we think about politics, ideology and history. He assesses the ideas that he argues have sustained inequality for the past millennium, reveals why the shallow politics of right and left are failing us today, and outlines the structure of a fairer economic system.

Robert Shiller, Narrative Economics: How Stories Go Viral and Drive Major Economic Events’, Princeton University, September 2019.

Shiller argues that studying popular stories that affect individual and collective economic behavior—what he calls “narrative economics”—has the potential to vastly improve our ability to predict, prepare for, and lessen the damage of financial crises, recessions, depressions, and other major economic events.

Binyamin Appelbaum, ‘The Economist’s Hour: False Prophets, Free Markets and the Fracture of Society’, Little, Brown and Company, August 2019.

Appelbaum shows how economists who believed in the power of free markets transformed government, business and everyday life in the four decades between 1969 and 2008. The result, he argues, is weak growth, inequality, social tensions, decaying infrastructure and environmental degradation.

Branko Milanovic, Capitalism Alone: The Future of the System That Rules Alone’, Harvard University Press, September 2019.

Milanovic argues that capitalism is here to stay because it is best at delivering prosperity and personal autonomy. Left to itself, capitalism leads to instability and empty materialism, but it is a human system; we can make it serve our choices. The challenge is to decide what kind of society we want.

Katharina Pistor, ‘The Code of Capitalism: How the Law Creates Wealth and Inequality’, May 2019, Princeton University Press.

Pistor shows most people have no idea where capital actually comes from. She shows how the law selectively ‘codes’certain assets as ‘capital’, endowing them with the capacity to protect and produce private wealth, and argues that this codification is one of the biggest reasons for the widening wealth gap.

Danny G. Blanchflower, ‘Not Working: Where Have All the Good Jobs Gone’, Princeton University Press, 2019.

Blanchflower explains why economies have much more spare capacity than suggested by low unemployment rates. Many workers have given up trying to find a job or are underemployed and wage growth remains below pre-crisis levels. The resulting unhappiness and insecurity are driving populism. Governments need to do everything to boost demand for labour.

Mariana Mazzucato, ‘The Value of Everything: Making and Taking in the Global Economy’, Penguin, 2018.

Mazzucato shows how the difference between value creation and extraction has become blurred, allowing certain actors in the economy to portray themselves as value creators when they are just moving existing value around or even destroying it. To foster long-term growth, we need to redefine how we measure value, rethink public policy and the role of the public sector.

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