Le 23 balle sul capitalismo che continuano a raccontarvi

[San Siro]

In verità, il libro in questione ha un titolo leggermente diverso "23 Things They Don't Tell You About Capitalism" e l'autore è il bravissimo Ha-Joon Chang, che Martin Wolf (Ramirez, prendi nota!) "il più efficace critico della globalizzazione al mondo", ma in italiano viene così.

Non è stato, mi pare, ancora tradotto, ma penso che arriverà presto un'edizione italiana (ma non è detto). Chi non ce la fa ad aspettare, può ordinarselo su Amazon, dove potrà anche sfogliare la maggior parte del libro.

Qui riporto una buona recensione a cura dei frequentatori del sito.

Buona lettura.


The 2008 'Great Recession' demands re-examination of prevailing economic thought - the dominant paradigm (post 1970's conservative free-market capitalism) not only failed to predict the crisis, but also said it couldn't occur in today's free markets, thanks to Adam Smith's 'invisible hand.' Ha-Joon Chang provides that re-examination in his "23 Things They Don't Tell You About Capitalism." Turns out that the reason Adam Smith's hand was not visible is that it wasn't there. Chang, economics professor at the University of Cambridge, is no enemy of capitalism, though he contends its current conservative version should be made better. Conventional wisdom tells us that left alone, markets produce the most efficient and just outcomes - 'efficient' because businesses and individuals know best how to utilize their resources, and 'just' because they are rewarded according to their productivity. Following this advice, countries have deregulated businesses, reduced taxes and welfare, and adopted free trade. The results, per Chang, has been the opposite of what was promised - slower growth and rising inequality, often masked by rising credit expansion and increased working hours. Alternatively, developing Asian countries that grew fast did so following a different version of capitalism, though to be fair China's version to-date has also produced much greater inequality. The following summarizes some of Chang's points:

1)"There is no such thing as a free market" - we already have hygiene standards in restaurants, ban child labor, pollution, narcotics, bribery, and dangerous workplaces, require licenses for professions such as doctors, lawyers, and brokers, and limit immigration. In 2008, the U.S. used at least $700 billion of taxpayers' money to buy up toxic assets, justified by President Bush on the grounds that it was a necessary state intervention consistent with free-market capitalism. Chang's conclusion - free-marketers contending that a certain regulation should not be introduced because it would restrict market freedom are simply expressing political opinions, not economic facts or laws.

2)"Companies should not be run in the interest of their owners." Shareholders are the most mobile of corporate stakeholders, often holding ownership for but a fraction of a second (high-frequency trading represents 70% of today's trading). Shareholders prefer corporate strategies that maximize short-term profits and dividends, usually at the cost of long-term investments. (This often also includes added leverage and risk, and reliance on socializing risk via 'too big to fail' status, and relying on 'the Greenspan put.') Chang adds that corporate limited liability, while a boon to capital accumulation and technological progress, when combined with professional managers instead of entrepreneurs owning a large chunk (eg. Ford, Edison, Carnegie) and public shares with smaller voting rights (typically limited to 10%), allows professional managers to maximize their own prestige via sales growth and prestige projects instead of maximizing profits. Another negative long-term outcome driven by shareholders is increased share buybacks (less than 5% of profits until the early 1980s, 90% in 2007, and 280% in 2008) - one economist estimates that had GM not spent $20.4 billion on buybacks between 1986 and 2002 it could have prevented its 2009 bankruptcy. Short-term stockholder perspectives have also brought large-scale layoffs from off-shoring. Governments of other countries encourage longer-term thinking by holding large shares in key enterprises (China Mobile, Renault, Volkswagen), providing greater worker representation (Germany's supervisory boards), and cross-shareholding among friendly companies (Japan's Toyota and its suppliers).

7)"Free-market policies rarely make poor countries rich." With a few exceptions, all of today's rich countries, including Britain and the U.S., reached that status through protectionism, subsidies, and other policies that they and their IMF, WTO, and World Bank now advise developing nations not to adopt. Free-market economists usually respond that the U.S. succeeded despite, not because of, protectionism. The problem with that explanation is the number of other nations paralleling the early growth strategy of the U.S. and Britain (Austria, Finland, France, Germany, Japan, Korea, Singapore, Sweden, Taiwan), and the fact that apparent exceptions (Hong Kong, Switzerland, The Netherlands) did so by ignoring foreign patents (a free-market 'no-no'). Chang believes the 'official historians' of capitalism have been very successful re-writing its history, akin to someone trying to 'kick away the ladder' with which they had climbed to the top. He also points out that developing nations that stick to their Ricardian 'comparative advantage,' per the conservatives prescription, condemn themselves to their economic status quo.

9)"We do not live in a post-industrial age." Most of the fall in manufacturing's share of total output is not due to a fall in the quantity of manufactured goods, but due to the fall in their prices relative to those for services, caused by their faster productivity growth. A small part of deindustrialization is due to outsourcing of some 'manufacturing' activities that used to be provided in-house - eg. catering and cleaning. Those advising the newly developing nations to skip manufacturing and go directly to providing services forget that many services mainly serve manufacturing firms (finance, R&D, design), and that since services are harder to export, such an approach will create balance-of-payment problems. (Chang's preceding points directly contradict David Ricardo's law of comparative advantage - a fundamental free market precept. Chang's example of how Korea built Pohang Steel into a strong economic producer, despite lacking experienced managers and natural resources, is another.)

10)"The U.S. does not have the highest living standard in the world." True, the average U.S. citizen has greater command over goods and services than his counterpart in almost any other country, but this is due to higher immigration, poorer employment conditions, and working longer hours for many vs. their foreign counterparts. The U.S. also has poorer health indicators and worse crime statistics. We do have the world's second highest income per capita - Luxemburg's higher, but measured in terms of purchasing power parity (PPP) the U.S. ranks eighth. (The U.S. doesn't have the fastest growing economy either - China is predicted to pass the U.S. in PPP this coming decade.) Chang's point here is that we should stop assuming the U.S. provides the best economic model. (This is already occurring - the World Bank's chief economist, Justin Lin, comes from China.)

12)"Governments can pick winners." Chang cites examples of how the Korean government built world-class producers of steel (POSCO), shipbuilding (Hyundai), and electronics (LG), despite lacking raw materials or experience for those sectors. True, major government failures have occurred - Europe's Concorde, Indonesia's aircraft industry, Korea's promotion of aluminum smelting, and Japan's effort to have Nissan take over Honda; industry, however, has also failed - eg. the AOL-Time Warner merger, and the Daimler-Chrysler merger. Austria, China, Finland, France, Japan, Norway, Singapore (in numerous other areas), and Taiwan have also done quite well with government-picked winners. Another problem is that business and national interests sometimes clash - eg. American firms' massive outsourcing has undermined the national interest of maintaining full employment. (However, greater unbiased U.S. government involvement would be difficult due to the 10,000+ corporate lobbyists and billions in corporate campaign donations - $500 million alone from big oil in 2009-10.) Also interesting to Chang is how conservative free marketing bankers in the U.S. lined up for mammoth low-cost loans from the Federal Reserve at the beginning of the Great Recession. Government planning allows minimizing excess capacity, maximizing learning-curve economies and economies of scale and scope; operational performance is enhanced by also forcing government-owned or supported firms into international competition. Government intervention (loans, tariffs, subsidies, prohibiting exports of needed raw materials, building infrastructure) are necessary for emerging economies to move into more sophisticated sectors.

13)"Making rich people richer doesn't make the rest of us richer." 'Trickle-down' economics is based on the belief that the poor maximize current consumption, while the rich, left to themselves, mostly invest. However, the years 1950-1973 saw the highest-ever growth rates in the U.S., Canada, Australia, and New Zealand, despite increased taxation of the rich. Before the 'Golden Age,' per capita income grew at 1-1.5%/year; during the Golden Age it grew at 2-3% in the U.S. Since then, tax cuts for the rich and financial deregulation have allowed greater paychecks for top managers and financiers, and between 1979 and 2006 the top 0.1% increased their share of national income from 3.5% to 11.6%. The result - investment as a ratio of national output has fallen in all rich economies and the pace at which the total economic pie grew decreased.

14)"U.S. managers are over-priced." First, relative to their predecessors (about 10X those in the 1960s; now 300-400X the average worker), despite the latter having run companies more successfully, in relative terms. Second, compared to counterparts in other rich countries - up to 20X. (Third, compared to counterparts in developing nations - eg. JPMorgan Chase, world's 4th largest bank, paid its CEO $19.6 million in 2008, vs. the CEO of the Industrial and Commercial Bank of China, the world's largest, being paid $234,700.) American CEOs do not get punished for bad management either - instead receiving raises and restated stock options, or at least loan forgiveness and golden parachutes. (Collusion among CEO members of interlocking 'rubber-stamp' boards fed limited information is one reason for excessive U.S. CEO pay; lack of stockholder interest, thanks to being paid high and rising dividends, a short-term strategy, is another.) Chang asks, rhetorically, "If American CEOs are worth so much, how come their companies have been losing out to foreign competitors?" (And why aren't they investing like their foreign counterparts, instead of sitting on some $2 trillion in current assets?)

17)"More education in itself is not going to make a country richer." Increasing deindustrialization and automation have lowered knowledge requirements for most jobs in rich countries. The East Asian miracle economies turned in their impressive early gains despite literacy rates of about 50%, and Korean public schools had class sizes of 90; conversely, countries like the Philippines and Argentina did poorly despite having significantly better-educated populations, while Sub-Saharan Africa per capita income fell 0.3%/year from 1980-2004 despite literacy rates rising from 40% to 61%. Harvard economist Lant Pritchett analyzed data from 1960-87 and found very little evidence supporting the view that increased education leads to higher economic growth. Most education isn't even meant to raise productivity, and math/science courses are not relevant for most. Switzerland is one of the richest and most industrialized countries, but also has the lowest university enrollment in the rich world. (College education in the U.S. has already become a bubble - about half our graduates take jobs not requiring such education.)

Chang's recommendations include ending our "love affair with unrestrained, free-market capitalism and installing a better-regulated variety," having government become more active in economic affairs, and making financial markets less attractive. (U.S. financial assets/GDP exceeded 900% by the early 2000s, averaged 4-12% return since deregulation - higher than most non-financial firms at between 2-5%, and divert attention from manufacturing and its potentially much larger employment. Methods of doing so include taxing market transactions, banning short-selling and derivatives, and limiting bank leverage.)

Bottom-Line: Chang's one shortcoming is ignoring/understating the large negative impact of large trade deficits on the U.S. - this sometimes skews his assessment of the impact of other factors. Overall, however, "23 Things They Don't Tell You About Capitalism" provides a sorely needed approach to economic decision-making - using data rather than ideology. Readers will be left wondering why Chang or other Asians don't win the Nobel prize in economics - it's their economies that have been transforming the world for last 50 years, not the free-market conservative capitalist economies of the U.S. or Europe.

[fdg86]

mmmm 7 euro su kindle...quasi quasi...tu l'hai letto?

certo è che molti di questi punti sono noti. Non vorrei che mi venisse a ripetere cose che già conosco.

[San Siro]

Originalmente inviato da fdg86

mmmm 7 euro su kindle...quasi quasi...tu l'hai letto?

certo è che molti di questi punti sono noti. Non vorrei che mi venisse a ripetere cose che già conosco.

Io mi sono letto i libri precedenti, in inglese, e in italiano "Cattivi Samaritani".

E' molto probabile che ti dica cose che già conosci.

Quello per cui è interessante, secondo me, è che essendo un economista e non un giornalista, fa riferimento a testi e articoli presi dalla letteratura economica recente.

Insomma, questi tipi di libri li prendo per mantenermi aggiornato.

Per esempio, un paio di anni fa mi sono preso America Works di Freeman, che spiega come funziona il mercato del lavoro americano e come vengono prodotte le disuguaglianze.

Ma essendo un testo del 2007, è già ora di prenderne uno più aggiornato.

[Dunwich]

yaaaawwwwnnnn

[toyotakoala]

chi legge sto papiro o e' un malato di mente o e' qualcuno che non ha un piffero da fare

[ScubaDuc]

Per me' non ha senso: lo Stato non e' mai stato capace di "consistently pick the winners"

Emphasis added on the word "consistently".

C'e' un bell' articolo di Becker che discute se l' interventismo statale sia meglio del "laissez-faire"... Becker conclude che l' interventismo e' giustificato solo se il market failure e' rilevante e tende ad aumentare.....Perche' esiste anche il Government failure e non solo il market failure

Eccovi l' articolo di Gary Becker, "uno che sa' ", come direbbe Dogo... Un poco lunghetto, ma vale la pena leggerlo

When an industry in the private sector is not performing efficiently or effectively, there is said to be “market failure”. The recommendation by economists and others typically is then for government actions to combat such failure, such as taxes to help reduce pollution. The diagnosis of market failure may be accurate, but the call for government involvement may be naïve and inappropriate.

The reason is that actual governments do not necessarily do what economists and others want them to do because there is “government failure” as well as market failure. Before recommending government actions to correct market failures, one should consider whether actual government policies would worsen rather than improve private sector outcomes. Since many factors often make for considerable government failure, considering such failure is crucial and not just a theoretical fine point.

Consider, for example, that consumers are sometimes ignorant of the qualities and other aspects of the products they buy. However, before advocating various forms of government protection of consumers, we should recognize that voters are far more ignorant of political candidates then consumers are of what they buy. The reason is that consumers directly suffer if they make bad choices out of ignorance, while individual voters have negligible influence over political outcomes. Hence voters have little incentive to be informed about different candidates and their positions, and the consequences of the mistakes they make are largely borne by others.

Monopolies do arise in the private sector, as when Microsoft had monopoly power over personal computer operating systems, when IBM still earlier had monopoly power over computers, or when manufacturers form cartels to raise their prices by restricting production. Yet, monopoly also occurs in the political sector, and it is far more pervasive there. An industry that contains only two firms is considered a duopoly that is presumed to raise prices above competitive levels, but the political process is dominated in democratic countries by duopolies, such as the Democratic and Republican parties. In addition, when government companies receive monopoly positions, such as the US Postal Service or national oil companies in many countries, they generally succeed in either keeping out or greatly delaying the entrance of private competitors. By contrast, private monopolistic positions are usually temporary, as seen in the eroding over time of IBM’s and Microsoft’s dominant positions in the computer industry.

Government actions sometimes not only fail to overcome market failure but rather worsen the failure. Fannie Mae and Freddie Mac were formed as quasi-governmental institutions to help encourage mortgages in the residential housing market because of a belief that the private sector was not providing enough mortgages, especially to lower income families. Yet, as documented in detail in Reckless Endangerment by Gretchen Morgenson and Joshua Rosner, these two companies used their privileged positions to take excessive risks, and to insure large numbers of mortgage loans that should never have been made.

European regulators have attacked Microsoft, Google, General Electric, Intel, and other (mainly American) companies because of various alleged anti-competitive policies. In these cases, and in many antitrust cases brought by American regulators, such as the recent objection to the merger of AT&T and T-Mobile, the motivation seems to be to protect the competitors of these companies or to protect jobs rather than to improve outcomes to consumers.

Many countries subsidize various alternative forms of energy, such as wind, solar, biofuels, and electric batteries, because of the substantial pollution from using coal, oil, and other fossil fuels. Often, however, the choices of what to heavily subsidize are made on political rather than economic criteria. For example, for years hydrogen cars were politically the most promising substitute for gasoline driven cars; then hydrogen fell out of favor and electric cars became the political darlings. Since governments have seldom succeeded in picking technological winners, I suspect they will be wrong again in these attempts to steer the development of cost-effective alternatives to the internal combustion gasoline engine. Another example is the scandal about the heavy American government financial support to the solar panel company Solyndra that recently failed.

How does one approach policy once it is recognized that government failure is substantial, and often much worse than market failure? As a general rule I believe the presumption should be in favor of government actions only when market failures are quite large and persistent. So clearly governments should have the dominant role in the military and police areas, in the judiciary, in protecting against massive pollution, and in providing a safety net for its least fortunate members (private charities are important but do not do enough). On the other hand, when market failures are relatively small and likely to be temporary, as in monopoly situations or in exploiting consumer ignorance, government involvement should be minimal, as in minimalist anti-trust policies, and in allowing consumers generally to make their own decisions.

The intermediate cases are the most difficult: when market failures may be significant, and yet government alternatives are not attractive. This may be decided on a case-by-case basis, but I believe the usual rule should then be to let the market operate. This belief is based on the conclusion that, on the whole, government failure is far more pervasive, damaging, and less self-correcting, than is market failure. Others may reach different conclusions, but these are the problems that a relevant welfare analysis should focus on. Simply concluding that in particular instances markets are not working perfectly is a misleading and incorrect basis for supporting active and sizable government involvement.

[malwida]

Originalmente inviato da San Siro

In verità, il libro in questione ha un titolo leggermente diverso "23 Things They Don't Tell You About Capitalism" e l'autore è il bravissimo Ha-Joon Chang, che Martin Wolf (Ramirez, prendi nota!) "il più efficace critico della globalizzazione al mondo", ma in italiano viene così.

Non è stato, mi pare, ancora tradotto, ma penso che arriverà presto un'edizione italiana (ma non è detto). Chi non ce la fa ad aspettare, può ordinarselo su Amazon, dove potrà anche sfogliare la maggior parte del libro.

Qui riporto una buona recensione a cura dei frequentatori del sito.

Buona lettura.


The 2008 'Great Recession' demands re-examination of prevailing economic thought - the dominant paradigm (post 1970's conservative free-market capitalism) not only failed to predict the crisis, but also said it couldn't occur in today's free markets, thanks to Adam Smith's 'invisible hand.' Ha-Joon Chang provides that re-examination in his "23 Things They Don't Tell You About Capitalism." Turns out that the reason Adam Smith's hand was not visible is that it wasn't there. Chang, economics professor at the University of Cambridge, is no enemy of capitalism, though he contends its current conservative version should be made better. Conventional wisdom tells us that left alone, markets produce the most efficient and just outcomes - 'efficient' because businesses and individuals know best how to utilize their resources, and 'just' because they are rewarded according to their productivity. Following this advice, countries have deregulated businesses, reduced taxes and welfare, and adopted free trade. The results, per Chang, has been the opposite of what was promised - slower growth and rising inequality, often masked by rising credit expansion and increased working hours. Alternatively, developing Asian countries that grew fast did so following a different version of capitalism, though to be fair China's version to-date has also produced much greater inequality. The following summarizes some of Chang's points:

1)"There is no such thing as a free market" - we already have hygiene standards in restaurants, ban child labor, pollution, narcotics, bribery, and dangerous workplaces, require licenses for professions such as doctors, lawyers, and brokers, and limit immigration. In 2008, the U.S. used at least $700 billion of taxpayers' money to buy up toxic assets, justified by President Bush on the grounds that it was a necessary state intervention consistent with free-market capitalism. Chang's conclusion - free-marketers contending that a certain regulation should not be introduced because it would restrict market freedom are simply expressing political opinions, not economic facts or laws.

2)"Companies should not be run in the interest of their owners." Shareholders are the most mobile of corporate stakeholders, often holding ownership for but a fraction of a second (high-frequency trading represents 70% of today's trading). Shareholders prefer corporate strategies that maximize short-term profits and dividends, usually at the cost of long-term investments. (This often also includes added leverage and risk, and reliance on socializing risk via 'too big to fail' status, and relying on 'the Greenspan put.') Chang adds that corporate limited liability, while a boon to capital accumulation and technological progress, when combined with professional managers instead of entrepreneurs owning a large chunk (eg. Ford, Edison, Carnegie) and public shares with smaller voting rights (typically limited to 10%), allows professional managers to maximize their own prestige via sales growth and prestige projects instead of maximizing profits. Another negative long-term outcome driven by shareholders is increased share buybacks (less than 5% of profits until the early 1980s, 90% in 2007, and 280% in 2008) - one economist estimates that had GM not spent $20.4 billion on buybacks between 1986 and 2002 it could have prevented its 2009 bankruptcy. Short-term stockholder perspectives have also brought large-scale layoffs from off-shoring. Governments of other countries encourage longer-term thinking by holding large shares in key enterprises (China Mobile, Renault, Volkswagen), providing greater worker representation (Germany's supervisory boards), and cross-shareholding among friendly companies (Japan's Toyota and its suppliers).

7)"Free-market policies rarely make poor countries rich." With a few exceptions, all of today's rich countries, including Britain and the U.S., reached that status through protectionism, subsidies, and other policies that they and their IMF, WTO, and World Bank now advise developing nations not to adopt. Free-market economists usually respond that the U.S. succeeded despite, not because of, protectionism. The problem with that explanation is the number of other nations paralleling the early growth strategy of the U.S. and Britain (Austria, Finland, France, Germany, Japan, Korea, Singapore, Sweden, Taiwan), and the fact that apparent exceptions (Hong Kong, Switzerland, The Netherlands) did so by ignoring foreign patents (a free-market 'no-no'). Chang believes the 'official historians' of capitalism have been very successful re-writing its history, akin to someone trying to 'kick away the ladder' with which they had climbed to the top. He also points out that developing nations that stick to their Ricardian 'comparative advantage,' per the conservatives prescription, condemn themselves to their economic status quo.

9)"We do not live in a post-industrial age." Most of the fall in manufacturing's share of total output is not due to a fall in the quantity of manufactured goods, but due to the fall in their prices relative to those for services, caused by their faster productivity growth. A small part of deindustrialization is due to outsourcing of some 'manufacturing' activities that used to be provided in-house - eg. catering and cleaning. Those advising the newly developing nations to skip manufacturing and go directly to providing services forget that many services mainly serve manufacturing firms (finance, R&D, design), and that since services are harder to export, such an approach will create balance-of-payment problems. (Chang's preceding points directly contradict David Ricardo's law of comparative advantage - a fundamental free market precept. Chang's example of how Korea built Pohang Steel into a strong economic producer, despite lacking experienced managers and natural resources, is another.)

10)"The U.S. does not have the highest living standard in the world." True, the average U.S. citizen has greater command over goods and services than his counterpart in almost any other country, but this is due to higher immigration, poorer employment conditions, and working longer hours for many vs. their foreign counterparts. The U.S. also has poorer health indicators and worse crime statistics. We do have the world's second highest income per capita - Luxemburg's higher, but measured in terms of purchasing power parity (PPP) the U.S. ranks eighth. (The U.S. doesn't have the fastest growing economy either - China is predicted to pass the U.S. in PPP this coming decade.) Chang's point here is that we should stop assuming the U.S. provides the best economic model. (This is already occurring - the World Bank's chief economist, Justin Lin, comes from China.)

12)"Governments can pick winners." Chang cites examples of how the Korean government built world-class producers of steel (POSCO), shipbuilding (Hyundai), and electronics (LG), despite lacking raw materials or experience for those sectors. True, major government failures have occurred - Europe's Concorde, Indonesia's aircraft industry, Korea's promotion of aluminum smelting, and Japan's effort to have Nissan take over Honda; industry, however, has also failed - eg. the AOL-Time Warner merger, and the Daimler-Chrysler merger. Austria, China, Finland, France, Japan, Norway, Singapore (in numerous other areas), and Taiwan have also done quite well with government-picked winners. Another problem is that business and national interests sometimes clash - eg. American firms' massive outsourcing has undermined the national interest of maintaining full employment. (However, greater unbiased U.S. government involvement would be difficult due to the 10,000+ corporate lobbyists and billions in corporate campaign donations - $500 million alone from big oil in 2009-10.) Also interesting to Chang is how conservative free marketing bankers in the U.S. lined up for mammoth low-cost loans from the Federal Reserve at the beginning of the Great Recession. Government planning allows minimizing excess capacity, maximizing learning-curve economies and economies of scale and scope; operational performance is enhanced by also forcing government-owned or supported firms into international competition. Government intervention (loans, tariffs, subsidies, prohibiting exports of needed raw materials, building infrastructure) are necessary for emerging economies to move into more sophisticated sectors.

13)"Making rich people richer doesn't make the rest of us richer." 'Trickle-down' economics is based on the belief that the poor maximize current consumption, while the rich, left to themselves, mostly invest. However, the years 1950-1973 saw the highest-ever growth rates in the U.S., Canada, Australia, and New Zealand, despite increased taxation of the rich. Before the 'Golden Age,' per capita income grew at 1-1.5%/year; during the Golden Age it grew at 2-3% in the U.S. Since then, tax cuts for the rich and financial deregulation have allowed greater paychecks for top managers and financiers, and between 1979 and 2006 the top 0.1% increased their share of national income from 3.5% to 11.6%. The result - investment as a ratio of national output has fallen in all rich economies and the pace at which the total economic pie grew decreased.

14)"U.S. managers are over-priced." First, relative to their predecessors (about 10X those in the 1960s; now 300-400X the average worker), despite the latter having run companies more successfully, in relative terms. Second, compared to counterparts in other rich countries - up to 20X. (Third, compared to counterparts in developing nations - eg. JPMorgan Chase, world's 4th largest bank, paid its CEO $19.6 million in 2008, vs. the CEO of the Industrial and Commercial Bank of China, the world's largest, being paid $234,700.) American CEOs do not get punished for bad management either - instead receiving raises and restated stock options, or at least loan forgiveness and golden parachutes. (Collusion among CEO members of interlocking 'rubber-stamp' boards fed limited information is one reason for excessive U.S. CEO pay; lack of stockholder interest, thanks to being paid high and rising dividends, a short-term strategy, is another.) Chang asks, rhetorically, "If American CEOs are worth so much, how come their companies have been losing out to foreign competitors?" (And why aren't they investing like their foreign counterparts, instead of sitting on some $2 trillion in current assets?)

17)"More education in itself is not going to make a country richer." Increasing deindustrialization and automation have lowered knowledge requirements for most jobs in rich countries. The East Asian miracle economies turned in their impressive early gains despite literacy rates of about 50%, and Korean public schools had class sizes of 90; conversely, countries like the Philippines and Argentina did poorly despite having significantly better-educated populations, while Sub-Saharan Africa per capita income fell 0.3%/year from 1980-2004 despite literacy rates rising from 40% to 61%. Harvard economist Lant Pritchett analyzed data from 1960-87 and found very little evidence supporting the view that increased education leads to higher economic growth. Most education isn't even meant to raise productivity, and math/science courses are not relevant for most. Switzerland is one of the richest and most industrialized countries, but also has the lowest university enrollment in the rich world. (College education in the U.S. has already become a bubble - about half our graduates take jobs not requiring such education.)

Chang's recommendations include ending our "love affair with unrestrained, free-market capitalism and installing a better-regulated variety," having government become more active in economic affairs, and making financial markets less attractive. (U.S. financial assets/GDP exceeded 900% by the early 2000s, averaged 4-12% return since deregulation - higher than most non-financial firms at between 2-5%, and divert attention from manufacturing and its potentially much larger employment. Methods of doing so include taxing market transactions, banning short-selling and derivatives, and limiting bank leverage.)

Bottom-Line: Chang's one shortcoming is ignoring/understating the large negative impact of large trade deficits on the U.S. - this sometimes skews his assessment of the impact of other factors. Overall, however, "23 Things They Don't Tell You About Capitalism" provides a sorely needed approach to economic decision-making - using data rather than ideology. Readers will be left wondering why Chang or other Asians don't win the Nobel prize in economics - it's their economies that have been transforming the world for last 50 years, not the free-market conservative capitalist economies of the U.S. or Europe.

Una dimostrazione del fallimento della teoria liberista nella sua traduzione pratica. Ottimo articolo Sansiro.

[malwida]

Originalmente inviato da ScubaDuc

Per me' non ha senso: lo Stato non e' mai stato capace di "consistently pick the winners"

Emphasis added on the word "consistently".

C'e' un bell' articolo di Becker che discute se l' interventismo statale sia meglio del "laissez-faire"... Becker conclude che l' interventismo e' giustificato solo se il market failure e' rilevante e tende ad aumentare.....Perche' esiste anche il Government failure e non solo il market failure

Eccovi l' articolo di Gary Becker, "uno che sa' ", come direbbe Dogo... Un poco lunghetto, ma vale la pena leggerlo

When an industry in the private sector is not performing efficiently or effectively, there is said to be “market failure”. The recommendation by economists and others typically is then for government actions to combat such failure, such as taxes to help reduce pollution. The diagnosis of market failure may be accurate, but the call for government involvement may be naïve and inappropriate.

The reason is that actual governments do not necessarily do what economists and others want them to do because there is “government failure” as well as market failure. Before recommending government actions to correct market failures, one should consider whether actual government policies would worsen rather than improve private sector outcomes. Since many factors often make for considerable government failure, considering such failure is crucial and not just a theoretical fine point.

Consider, for example, that consumers are sometimes ignorant of the qualities and other aspects of the products they buy. However, before advocating various forms of government protection of consumers, we should recognize that voters are far more ignorant of political candidates then consumers are of what they buy. The reason is that consumers directly suffer if they make bad choices out of ignorance, while individual voters have negligible influence over political outcomes. Hence voters have little incentive to be informed about different candidates and their positions, and the consequences of the mistakes they make are largely borne by others.

Monopolies do arise in the private sector, as when Microsoft had monopoly power over personal computer operating systems, when IBM still earlier had monopoly power over computers, or when manufacturers form cartels to raise their prices by restricting production. Yet, monopoly also occurs in the political sector, and it is far more pervasive there. An industry that contains only two firms is considered a duopoly that is presumed to raise prices above competitive levels, but the political process is dominated in democratic countries by duopolies, such as the Democratic and Republican parties. In addition, when government companies receive monopoly positions, such as the US Postal Service or national oil companies in many countries, they generally succeed in either keeping out or greatly delaying the entrance of private competitors. By contrast, private monopolistic positions are usually temporary, as seen in the eroding over time of IBM’s and Microsoft’s dominant positions in the computer industry.

Government actions sometimes not only fail to overcome market failure but rather worsen the failure. Fannie Mae and Freddie Mac were formed as quasi-governmental institutions to help encourage mortgages in the residential housing market because of a belief that the private sector was not providing enough mortgages, especially to lower income families. Yet, as documented in detail in Reckless Endangerment by Gretchen Morgenson and Joshua Rosner, these two companies used their privileged positions to take excessive risks, and to insure large numbers of mortgage loans that should never have been made.

European regulators have attacked Microsoft, Google, General Electric, Intel, and other (mainly American) companies because of various alleged anti-competitive policies. In these cases, and in many antitrust cases brought by American regulators, such as the recent objection to the merger of AT&T and T-Mobile, the motivation seems to be to protect the competitors of these companies or to protect jobs rather than to improve outcomes to consumers.

Many countries subsidize various alternative forms of energy, such as wind, solar, biofuels, and electric batteries, because of the substantial pollution from using coal, oil, and other fossil fuels. Often, however, the choices of what to heavily subsidize are made on political rather than economic criteria. For example, for years hydrogen cars were politically the most promising substitute for gasoline driven cars; then hydrogen fell out of favor and electric cars became the political darlings. Since governments have seldom succeeded in picking technological winners, I suspect they will be wrong again in these attempts to steer the development of cost-effective alternatives to the internal combustion gasoline engine. Another example is the scandal about the heavy American government financial support to the solar panel company Solyndra that recently failed.

How does one approach policy once it is recognized that government failure is substantial, and often much worse than market failure? As a general rule I believe the presumption should be in favor of government actions only when market failures are quite large and persistent. So clearly governments should have the dominant role in the military and police areas, in the judiciary, in protecting against massive pollution, and in providing a safety net for its least fortunate members (private charities are important but do not do enough). On the other hand, when market failures are relatively small and likely to be temporary, as in monopoly situations or in exploiting consumer ignorance, government involvement should be minimal, as in minimalist anti-trust policies, and in allowing consumers generally to make their own decisions.

The intermediate cases are the most difficult: when market failures may be significant, and yet government alternatives are not attractive. This may be decided on a case-by-case basis, but I believe the usual rule should then be to let the market operate. This belief is based on the conclusion that, on the whole, government failure is far more pervasive, damaging, and less self-correcting, than is market failure. Others may reach different conclusions, but these are the problems that a relevant welfare analysis should focus on. Simply concluding that in particular instances markets are not working perfectly is a misleading and incorrect basis for supporting active and sizable government involvement.

Articolo interessante. Così come il mercato può fallire anche l'intervento del governo può essere fallimentare, quindi il governo si astenga a meno che...non si facciano grossi casini. Questo significa che se una fabbrica sta "leggermente" inquinando un fiume bisogna aspettare che lo riduca una fogna per intervenire, o se una azienda alimentare sta usando "piccole" dosi di un additivo cancerogeno bisogna aspettare di avere i casi di tumore per intervenire. Di che cosa ci preoccupiamo, non è più grave NON sapere più chi votare? repubblicani e democartici sono uguali e aggungo io PD e PDL idem. E' proprio questo il problema. Ci vogliamo chiedere perchè?
Per essere credibile l'autore oltre a Fannie Mae doveva citare anche tutte le altre banche private che si sono divertite alla roulette immobiliare.
Infine i monopoli privati sono temporani e quelli pubblici eterni? Bè in Italia lo stato ha perso tutto il monopolio bancario a partire dagli anni 90. Vedete voi ora le banche come sono messe.
Le macchine a idrogeno? ma credi che se ci fosse stata una vera convenienza le Industrie automobilistiche non le avrebero prodotte?

[San Siro]

Originalmente inviato da ScubaDuc

Per me' non ha senso: lo Stato non e' mai stato capace di "consistently pick the winners"

Emphasis added on the word "consistently".

C'e' un bell' articolo di Becker che discute se l' interventismo statale sia meglio del "laissez-faire"... Becker conclude che l' interventismo e' giustificato solo se il market failure e' rilevante e tende ad aumentare.....Perche' esiste anche il Government failure e non solo il market failure

Eccovi l' articolo di Gary Becker, "uno che sa' ", come direbbe Dogo... Un poco lunghetto, ma vale la pena leggerlo

(...)

Senza offesa, ma questo non è un articolo. E' un collage di opinioni che possono essere giuste o sbagliate; ma certamente chi sbarcasse da un altro pianeta non capirebbe se sono corrette o meno, perché non c'è un solo dato o un solo rimando a qualche studio basato su fatti precisi.


Aggiungo che le politiche industriali sono ciò che hanno accomunato tutti i paesi che sono diventati ricchi. Politiche che sono in auge anche negli Stati Uniti odierni, tramite le spese militari.

Perché dovrebbe essere ovvio che l'intervento dello Stato in una fase evoluta è diverso rispetto a 50 anni fa o rispetto a un paese agli inizi del percorso di industrializzazione.

Nessuno pensa che se è il momento delle energie rinnovabili lo Stato si deve mettere a produrre pannelli solari...

[fdg86]

Cmq non c'è scritto da nessuna parte che i governi possono scegliere le potenziali compagnia di successo "consistently". C'è solo scritto che POSSONO. Una bella differenza in termini di % di successo...