On Mazzucato's "The Entrepreneurial State"

In this book, Mazzucato makes the argument that the state is the best actor to be the one to make long-range investments in technology, as private actors under capitalism are too focused on short term rewards to really be able to focus on real blue ocean development.

In fact, she argues, some of the more celebrated examples of private innovation can be linked to research and investment the state has made. This process of celebrating the private corporation has a way of erasing what the state has done and allows political rhetoric to attack research the state does. Her best example in the book is the Apple iPhone, where she looks at the basic research from the internet to mobile telephony to interface design that goes back to work governments did starting thirty or more years ago. I think as a reader that this example is strong enough to support her basic argument, but she also continues in the book to look at solar power as another example. Because this isn’t as widespread as the iPhone and its clones, it feels like a weaker example, even if down the road it will be more prevalent than the iPhone.

I don't see myself here: Mises and "The Anti-Capitalistic Mentality"

Mises is interesting to me in part because he helped kick off the Socialist Calculation debate in the 20s by trying to show how socialism wouldn’t work in his estimation. I thought Mises’s argument was tortured, but Hayek did put a nice bow on it by looking at the problem of incomplete information.

I wanted to read more Mises without having to slog through Human Action, so I pulled this text. This text is especially salient to me because I am highly critical of capitalism as it really exists. The problem is that in reading the book, I really didn’t see myself. I think this is because the Capitalism Mises describes is a very rosy idealized version that doesn’t exist – there are no embedded power structures that prevent the rise of the talented or anything that distributes rent to people who don’t earn it. For Mises, in fact, even crisis and depression are not part of the capitalistic system, but are instead “the result of interventionist attempts to regulate capitalism” (pp. 60). For Mises, the person who is against capitalism is so because of a sort of envy of those who have been successful – he internalizes the idea that the fruits of labor and capital are evenly distributed and any questioning of this is sour grapes. To me, this is laughable in that same vein of argument that communism will work only just we haven’t tried real communism yet – with that being defined differently by the speaker. Ultimately, I wasn’t convinced. Perhaps I’ll have to slog through Human Action to get at his arguments in more depth, but I’m in no rush.

Economics from the Ground Up: Mazzucato and "The Value of Everything"

Mazzucato is one of the most interesting economists working today. I say this because her project in the last two books focus on a ground-up redetermination of what is important in the economy. To someone like me, who is interested in the social generation and distribution of resources but who think that policy makers went the wrong way in recent years (especially before 2008, see Bernanke to Friedman: “Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression. You're right, we did it. We're very sorry. But thanks to you, we won't do it again. “) this book is just catnip. So much catnip that I stayed up too late a couple of nights in a row reading it.

Mazzucato, in this book, looks at where value was theoretically derived historically from the physiocrats to Smith through Marx and into the marginal revolution. She focuses the critique on the marginalists and the composition of current GDP about how it focus to much on the market – how what has a price has value and nothing else. For Mazzucato, this sidelines non-market institutions like the government which are long-term value creators but left out of market considerations because what they do doesn’t have a price. It is a compelling argument to look at how we analyze “the economy” in a different light.