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The Value of Everything: Making and Taking in the Global Economy

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Modern economies reward activities that extract value rather than create it. This must change to insure a capitalism that works for us all. In this scathing indictment of our current global financial system, The Value of Everything rigorously scrutinizes the way in which economic value has been determined and reveals how the difference between value creation and value extra Modern economies reward activities that extract value rather than create it. This must change to insure a capitalism that works for us all. In this scathing indictment of our current global financial system, The Value of Everything rigorously scrutinizes the way in which economic value has been determined and reveals how the difference between value creation and value extraction has become increasingly blurry. Mariana Mazzucato argues that this blurriness allowed certain actors in the economy to portray themselves as value creators, while in reality they were just moving existing value around or, even worse, destroying it. The book uses case studies - from Silicon Valley to the financial sector to big pharma - to show how the foggy notions of value create confusion between rents and profits, a difference that distorts the measurements of growth and GDP. The lesson here is urgent and sobering: to rescue our economy from the next, inevitable crisis and to foster long-term economic growth, we will need to rethink capitalism, rethink the role of public policy and the importance of the public sector, and redefine how we measure value in our society.


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Modern economies reward activities that extract value rather than create it. This must change to insure a capitalism that works for us all. In this scathing indictment of our current global financial system, The Value of Everything rigorously scrutinizes the way in which economic value has been determined and reveals how the difference between value creation and value extra Modern economies reward activities that extract value rather than create it. This must change to insure a capitalism that works for us all. In this scathing indictment of our current global financial system, The Value of Everything rigorously scrutinizes the way in which economic value has been determined and reveals how the difference between value creation and value extraction has become increasingly blurry. Mariana Mazzucato argues that this blurriness allowed certain actors in the economy to portray themselves as value creators, while in reality they were just moving existing value around or, even worse, destroying it. The book uses case studies - from Silicon Valley to the financial sector to big pharma - to show how the foggy notions of value create confusion between rents and profits, a difference that distorts the measurements of growth and GDP. The lesson here is urgent and sobering: to rescue our economy from the next, inevitable crisis and to foster long-term economic growth, we will need to rethink capitalism, rethink the role of public policy and the importance of the public sector, and redefine how we measure value in our society.

30 review for The Value of Everything: Making and Taking in the Global Economy

  1. 5 out of 5

    Dan

    Mazzucato's observations and conclusions won't surprise readers who've read more than one or two works of contemporary critical theory. But the fact that she is writing in a different register and for a largely different audience matters a great deal in this case, and I found the book very rewarding (and even rather moving in her concluding call for an "economics of hope").

  2. 4 out of 5

    Mehrsa

    A must-read for finance people and economists. This is an excellent history of bad ideas and theories in economics. Most especially, about how the government got removed and discounted as a creator of value. In fact, government investments create much of the value that the market uses and builds upon. When people think about government investments, they think about Solyndra. Mazzucato asks us to consider Tesla and the smartphone and the internet and all of the foundational modern technologies an A must-read for finance people and economists. This is an excellent history of bad ideas and theories in economics. Most especially, about how the government got removed and discounted as a creator of value. In fact, government investments create much of the value that the market uses and builds upon. When people think about government investments, they think about Solyndra. Mazzucato asks us to consider Tesla and the smartphone and the internet and all of the foundational modern technologies and companies that began with government grants and investments.

  3. 5 out of 5

    Tony Philpin

    Mariana is a post Keynesian, hence relies on observations of actual economic behaviour rather than doctrine and illogical theoretical assumptions (as did Keynes in his writings) and some of this book follows Keynes' discussions in his General Theory. She debunks the classicists in a comparable fashion. It is refreshingly entertaining writing. The whole book is readable, and is a logical sequel to her previous 'entrepreneurial state', developing similar themes. The chapters on theory of value do n Mariana is a post Keynesian, hence relies on observations of actual economic behaviour rather than doctrine and illogical theoretical assumptions (as did Keynes in his writings) and some of this book follows Keynes' discussions in his General Theory. She debunks the classicists in a comparable fashion. It is refreshingly entertaining writing. The whole book is readable, and is a logical sequel to her previous 'entrepreneurial state', developing similar themes. The chapters on theory of value do not actually reach a defined conclusion and she does skirt the issue of how utilitarianism led to neoclassicism a little, but it is still powerful stuff. Her arguments are compelling - the financial sector is basically parasitic, and the reasoning is solid. 21stC capitalism tends to extract rather than create value. A little more on how externalities - especially environmental damage, carbon emissions and pollution - are written out of the value equation would have been welcome, given that climate change is basically an economic issue. She is canny in citing Marx and Smith, and extracts residual value from all the classicists after her critiques. If only my own economics lectures at UCL had been as considered and with an equivalent standard of critical assessment, I might have not abandoned the dismal science (she is an optimist) all those years ago.

  4. 5 out of 5

    Daniel

    Capitalism has a problem - and that is to confuse price with value. So not only we think a $6 apple must be nicer than a $2 one, we also think that someone earning $100k must be better than one earning $60k etc. Firms are also told to only maximise shareholder returns (a.k.a. ever lower Price/earning ratios), so they dutifully increase revenue (raise price), cut costs (outsource and sack staff). To boost stock price, they also buy back shares to decrease the number of outstanding stocks. Not onl Capitalism has a problem - and that is to confuse price with value. So not only we think a $6 apple must be nicer than a $2 one, we also think that someone earning $100k must be better than one earning $60k etc. Firms are also told to only maximise shareholder returns (a.k.a. ever lower Price/earning ratios), so they dutifully increase revenue (raise price), cut costs (outsource and sack staff). To boost stock price, they also buy back shares to decrease the number of outstanding stocks. Not only that makes workers suffer, increase inequality, but also decreases long term investment. That is because CEOs are rewarded with stock options and their performance is mostly based on stock price. Pharmaceutical companies charge enormous prices for new drugs. She wrote that historically, economists separate productive vs rent-seeking unproductive activity. According to the author finance is mostly unproductive activity. Corporate raiders buy companies with debt that was saddled on the very companies that were bought, and make quick profits while workers are laid off. Venture capitalists make enormous profits on companies built on government research (like GPS and internet both built by the military). Mazzucato also attacked the calculation of GDP, that it reflects not value but price. So we can boost our GDP instantly if we just pay each other to cook and clean our house, even if the amount of work done is the same and the net amount of money that changed hands is zero. Lastly, government has been put down as only the distributors of economic output, not generator of it. So government has been asked to step aside, to just provide some protection and order, and build some roads so that real private wealth generators can do their thing. The IMF and World Bank actually push this agenda to developing countries, asking them to sell almost everything to the private sector, and outsource essential services. This leads to higher cost, worse service and for the government to pick up the tab when private providers go bankrupt. Mazzucato suggested that we need to look at real Value, and that involves all the stakeholders. She does not have the solution yet but we need to start that conversation. She does have some suggestions: 1. Financial transaction tax to favour long term investment. 2. Grant fewer parents upstream so there is more open access. 3. Limit what pharmaceutical companies can charge 4. Any government support being conditioned on actual investment and not share buy-back. 5. Tax big tech companies more since they benefited from government basic research. This is a thought-provoking book, with very good ideas. However, finance workers are certainly important: our insurance, pension funds, and sovereign funds all depend on those guys to help us grow our money. The stock market exists to encourage IPOs and thus innovation backed by VCs (since they can then make profits by investing in start ups). It is also very hard to determine the value of something if we cannot rely on its price: who will decide then? A committee? That would be communism... And some government services are really inefficient. Nonetheless I am very inspired by this book because it really challenges many of my assumptions about the economy.

  5. 4 out of 5

    John Mihelic

    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 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.

  6. 5 out of 5

    Jeff Kaye

    This is a follow-up to the Entrepreneurial State and is a consideration of how the public sector should be shown to be adding economic value rather than being seen as a drain on the economy. This is done via an analysis of rent seekers in the 21st C like banks that have taken over from land owners in their rent-seeking capacity. It then reviews the concepts of the previous book - how government adds value to research and risk-taking to enable companies in the private sector to stand on their shou This is a follow-up to the Entrepreneurial State and is a consideration of how the public sector should be shown to be adding economic value rather than being seen as a drain on the economy. This is done via an analysis of rent seekers in the 21st C like banks that have taken over from land owners in their rent-seeking capacity. It then reviews the concepts of the previous book - how government adds value to research and risk-taking to enable companies in the private sector to stand on their shoulders and reap the financial benefits. It also assesses why education, roads and other core government provisions add real value that is not shown in GDP statistics. It also provides a good analysis on how the new monopolies in the virtual world like Facebook add no real value, should be charged by the consumer for the information provided and earns its money through advertising, which is non-valued adding. Its real value add is via the information provision. Overall, there is no question that government adds value and should reap some reward for it via royalties, profit shares etc. In my old industry of defence and aerospace, the US government did take a royalty on international sales where they had paid for R&D - this was a norm. But, governments seem to have lost the thread in their desire to placate private industry. Can this change before it is too late? We are already in a GDP overkill period where natural resources are in grave danger. We are close to robots taking many millions of jobs and where the consumer has seen wages held very low and is moving into low paid work. Not sure that MM has a method for evaluating all the new threads of economics within the focus on value but it is an important work that refocuses the economic mind so that government and private industry are seen not as competitors but, somehow, symbiotic.

  7. 4 out of 5

    Jesper Döpping

    Easy read with a strong argument for re-instating value as a key concern I bought this book because I read the entrepreneurial state. This book in my opinion in a very easy to understand way for non-economists argues that we have to return to a much more basic question - the question of value creation, what is it and what is it not? The book starts with a theory historical perspective that are incredible easy to understand on how value have been conceptualized. This theory perspective gives a cle Easy read with a strong argument for re-instating value as a key concern I bought this book because I read the entrepreneurial state. This book in my opinion in a very easy to understand way for non-economists argues that we have to return to a much more basic question - the question of value creation, what is it and what is it not? The book starts with a theory historical perspective that are incredible easy to understand on how value have been conceptualized. This theory perspective gives a clear guideline to the different perspectives and the development towards a subjective understanding of value and what problems that rises. In particular the consistent discussion of rent seeking or value extraction is important - even though it might for some readers at first glance will be seen as a finance and neoliberal ideology bashing, it works by closer consideration as a tool to positive start a discussion of what value creation really means. By going this way the author succeed in forcing us to reconsider our everyday concepts of the state, and in particular its role in creating long term value and prosperity. Inevitable it comes to question and ask questions of how to define and understand the value of the common good, growth, innovation and entrepreneurship. From a more organizational and sociological perspective she forces us to consider how we run private business, how we extract value from the business both in terms of distribution (top versus other stakeholders). It forces anyone working in business to think if we are just rent-seekers or we actually create some value for all stakeholders. I find this book very helpful to think about politics, economy, sociology and organizational science.

  8. 5 out of 5

    Jason Harrop

    The author does a good job of drawing attention to the evils of rent seeking behaviour. Parasites! Although I agree there is a role for government in encouraging innovation, the author overstates government's contribution. This claim is stated repeatedly, but never treated in any depth. The government invented the Internet? It would have been interesting to discuss the great man theory of invention. In asserting government should get a larger share of the spoils, she ignores its take via tax. In th The author does a good job of drawing attention to the evils of rent seeking behaviour. Parasites! Although I agree there is a role for government in encouraging innovation, the author overstates government's contribution. This claim is stated repeatedly, but never treated in any depth. The government invented the Internet? It would have been interesting to discuss the great man theory of invention. In asserting government should get a larger share of the spoils, she ignores its take via tax. In this way it gets a large share, and it certainly doesn't always share in the losses of failures. When one thinks of government, one thinks of inefficiency. Acknowledging and addressing this somehow would strengthen the argument that despite this, government can do things of value. I would have liked her to be more forceful in her recommendations regarding patents. As in, get rid of them! It would have been interesting to cover the value of open source. As an aside, there are parallels with the role of pricing in monopolies thinking which she might have drawn out. Overall, a bit repetitive and lacking in depth. But worth reading.

  9. 5 out of 5

    Mike O'Brien

    A must read! "While wealth is created through a collective effort, the massive imbalance in the distribution of the gains from economic growth has often been more the result of wealth extraction, whose potential scale globalization has greatly magnified... I will argue that the way the word ‘value’ is used in modern economics has made it easier for value-extracting activities to masquerade as value-creating activities. And in the process rents (unearned income) get confused with profits (earned in A must read! "While wealth is created through a collective effort, the massive imbalance in the distribution of the gains from economic growth has often been more the result of wealth extraction, whose potential scale globalization has greatly magnified... I will argue that the way the word ‘value’ is used in modern economics has made it easier for value-extracting activities to masquerade as value-creating activities. And in the process rents (unearned income) get confused with profits (earned income); inequality rises, and investment in the real economy falls. What’s more, if we cannot differentiate value creation from value extraction, it becomes nearly impossible to reward the former over the latter. If the goal is to produce growth that is more innovation-led (smart growth), more inclusive and more sustainable, we need a better understanding of value to steer us."

  10. 4 out of 5

    Romilly

    I fear that confirmation bias makes me a poor judge; the author articulates and explains what I have been feeling for years. She's a respected economist and writes accessibly. If you feel that something may be wrong with our rulers' views on the nature of value, read this book .

  11. 5 out of 5

    Wael Gamal

    من ينتجون ومن يأخذون في الاقتصاد شهد عام 2015 زيادات قوية في دخول قيادات البنوك الخاصة في مصر وصلت إلى 13 في المائة في بعضها، بينما أوقف تحديد الحد الأقصى للأجر (قبل إلغائه لاحقاً) نمو دخول قيادات البنوك العامة لتتوقف عند 42 ألف جنيه شهرياً. وبلغ متوسط دخول العشرين مديراً الأعلى في بنك فيصل الإسلامي (الأعلى بحسب المسح الذي أجرته جريدة المال)، حوالي 165 ألف جنيه شهرياً، والمتوسط هنا قد يعني وجود مديرين يتقاضون أعلى من هذا الرقم من بينهم ووجود من يتقاضون أقل. في عام 2015 ذاته، كان إنفاق 1600 جنيه ش من ينتجون ومن يأخذون في الاقتصاد شهد عام 2015 زيادات قوية في دخول قيادات البنوك الخاصة في مصر وصلت إلى 13 في المائة في بعضها، بينما أوقف تحديد الحد الأقصى للأجر (قبل إلغائه لاحقاً) نمو دخول قيادات البنوك العامة لتتوقف عند 42 ألف جنيه شهرياً. وبلغ متوسط دخول العشرين مديراً الأعلى في بنك فيصل الإسلامي (الأعلى بحسب المسح الذي أجرته جريدة المال)، حوالي 165 ألف جنيه شهرياً، والمتوسط هنا قد يعني وجود مديرين يتقاضون أعلى من هذا الرقم من بينهم ووجود من يتقاضون أقل. في عام 2015 ذاته، كان إنفاق 1600 جنيه شهرياً يقفز بالمواطن المصري إلى مصاف العشرة في المائة الأعلى دخلاً في البلاد، بينما كان حوالي 9 ملايين مصري ينفقون 300 جنيهاً فأقل شهرياً، بحسب أرقام مسح الدخل والإنفاق الصادرة عن الجهاز المركزي للتعبئة والإحصاء. هذا التفاوت الجبار لا يقتصر على مصر وعادة ما يتم تبريره بالأرباح التي يحققها القطاع، والتي تزيد في مصر وفي العالم كله، ومعها تزيد رواتب ودخول العاملين به، بالذات لمن يقبعون على قمته. في مصر مثلاً، حققت البنوك العاملة في البلاد أرباحاً تقدر بحوالي 48.5 مليار جنيه في التسع شهور من يناير حتى سبتمبر 2018، بلغ نصيب العاملين فيها منها حوالي 4.85 مليار جنيه. بالطبع، يرجح أن أنصبة القيادات العليا منها فاق بشدة أنصبة الموظفين الصغار. يبدو الأمر منطقياً للغاية: مؤسسات ناجحة تتحمل المخاطر وتحقق أرباحاً، ومديرون منتجون يقودونها لذلك فيأخذون مكافأتهم "العادلة" على حسن أدائهم. تتساءل الاقتصادية الإيطالية ماريانا مازوكاتو في أحدث كتبها الصادر في 2018، والذي ترشح للقائمة القصيرة لجريدة الفاينانشيال تايمز، "لكن ماذا لو أن هذه التوصيفات ببساطة قصص فحسب؟ خطاب يتم صياغته من أجل تبرير التفاوتات في الدخل والثروة، رواية تكافئ بشكل هائل القلة القادرة على إقناع الحكومات والمجتمع بأنها تستحق هذه المكافآت الكبيرة بينما على بقيتنا أن يقتاتوا بالبقايا؟". في عالم تتصاعد فيه اللامساواة في الدخل والثروة، وتزيد فيه أهمية الأنشطة المالية على حساب الاقتصاد الحقيقي في الصناعة والزراعة، تعيد مازوكاتو في كتابها الاعتبار لسؤال القيمة في الاقتصاد.. من يخلقها وكيف تتوزع، من يدورها ويحركها من قطاع لآخر ومن يعيشون بشكل طفيلي على عمل الآخرين (كأصحاب الأراضي من الأرستقراطية وقتها)، وهي الأسئلة المركزية التي ركز عليها الاقتصاديون الرواد كآدم سميث وديفيد ريكاردو وكارل ماركس. تشتبك الأكاديمية، التي تُدَرِّس اقتصاديات الابتكار والقيمة العاملة في لندن، مع هذا السؤال في عالمنا المعاصر: من ينتج ومن يحصد؟ وعواقب ذلك. مازوكاتو الحائزة على جوائز عدة من ضمنها جائزة ليونتيف لتوسيعها آفاق الفكر الاقتصادي، والمستشارة حاليا لعدد من الحكومات، كانت قد أثارت ضجة كبيرة قبل أعوام بعد إصدارها كتابها السابق عن الدور الريادي للدولة في الابتكار، والذي تكشف فيه مساهمة المال العام الكبيرة في الابتكارات التكنولوجية، التي تسمح لشركات مثل أبل بتحقيق مليارات الدولارات من الأرباح. في 2009، بعد عام واحد من مساهمة مؤسسات كمؤسسته في اندلاع الأزمة المالية، قال لويد بلانكفاين رئيس بنك جولدمان ساكس إن موظفيه هم من بين الأكثر إنتاجية في العالم. (كانت الحكومة قد اضطرت للتدخل بضخ مليارات الدولارات لدعم جولدمان ساكس وغيره من أموال دافعي الضرائب، بينما تخلصت الشركة من 3 آلاف موظف خلال عامين). تتحدى مازوكاتو فكرة الإنتاجية المرتفعة التي يتحدث عنها رئيس جولدمان ساكس، الذي ارتفعت مكافآته هو ونظرائه برغم كل شيء. وهي فكرة لا تقتصر على القطاع المالي. "يسمونها خلق القيمة لكنها في الحقيقة العكس، محض استخلاص للقيمة". يشير الكتاب هنا إلى أن القطاع المالي لم يكن يعد قطاعاً منتجاً في الاقتصاد في الحسابات القومية والناتج المحلي الإجمالي حتى عام 1970، بل كانت أهميته تنبع فحسب من تسهيله لعملية تراكم رأس المال ونقل الثروة الموجودة بالفعل، لا خلق ثروة جديدة. ثم تسلل القطاع المالي لحساب الناتج المحلي كناتج وسيط، أولاً كخدمة تساهم في تشغيل الصناعات الأخرى، الخالقة حقاً للقيمة، ثم تغير الوضع محاسبياً بالتزامن مع تغير السياسات بتقليص القيود على أنشطته والكم الذي يستطيع إقراضه والنقود التي يخلقها.. إلخ. "هذه التعديلات غيرت جذرياً كيف يتصرف القطاع وزادت من نفوذه على الاقتصاد الحقيقي". تجول مازوكاتو في كتابها بين قطاعات الأدوية والمال والتكنولوجيا وفي نظريات الاقتصاد المختلفة المتعلقة بالقيمة تاريخياً كي تثبت مقولتها الرئيسية بأن هذه القطاعات تستخلص القيمة في الاقتصاد وتتلقى عوائد مبالغ فيها بشدة عوضاً عن خلق القيمة. يضرب الكتاب مثلاً بشركة جلياد للأدوية التي سَعَّرَت دواء هارفوني لفيروس سي في 2014 بحوالي 95 ألف دولار لكورس علاجي مدته 3 شهور. كان تبرير الشركة وقتها أن تقاضي هذا الثمن يوازي القيمة التي يتسبب الدواء في تجنبها من تكاليف المرض لو لم يتم علاجه، وهو ما تسميه صناعة الأدوية "التسعير المبني على القيمة". ترد مازوكاتو على ذلك بعديد من الدراسات التي تؤكد عدم وجود أي علاقة بين سعر أدوية السرطان وغيرها وبين المنافع التي توفرها، التي هي أقل بما لا يقاس من السعر حتى بمنطق تكاليف المرض. "في الحقيقة فإن نسبة كبيرة من تكاليف الرعاية الصحية في العالم الغربي لا علاقة لها بالرعاية الصحية: ببساطة هي قيمة استخلاص القيمة التي تقوم به صناعة الأدوية". لكن الأمر لا يتوقف عند زيف رواية الكفاءة والإنتاجية كمبرر لكل هذه العوائد الهائلة. فالطريقة التي تشتغل بها قطاعات استخلاص القيمة، عبر الاستثمار في الأوراق المالية والمشتقات وإعادة شراء الأسهم، وهي أنشطة ريعية، ينطبق عليها وصف الاقتصادي الأشهر جون ماينارد كينز للمستثمرين فيه: "مستثمر عاطل يعتمد على ملكيته لرأس المال مستغلاً قيمة ندرته". في المقابل، بينما شهد الاقتصاد الأمريكي، مثلاً، زيادة في الإنتاجية بين 1975 و2015 بأكثر من ستين في المائة، تجمدت الأجور الحقيقية لمعظم الأمريكيين أو حتى انخفضت في الفترة ذاتها. مازوكاتو تقول إن سيطرة منطق التمويل وروايته الكاذبة عن خلق القيمة لا يتعلق فقط بحجم القطاع المالي وكيف فاق نموه الاقتصاد غير المالي، وباللامساواة في الدخل والثروة، وإنما أيضاً بآثاره على سلوك باقي الاقتصاد، الذي تم أمولة وتوريق أجزاء كبيرة منه. تركز النشاط في القطاعات التي تحرك القيمة وتستخلصها على حساب القطاعات التي تخلقها. "بينما يتم خلق الثروة عبر جهد جماعي، فإن عدم التوازن الهائل في توزيع ثمار النمو الاقتصادي عادة ما كان نتيجة لاستخلاص القيمة الذي وسعت العولمة بشدة من نطاقه". تقول مازوكاتو إن هذا وضع يقود الرأسمالية العالمية لأزمة وراء أزمة، وإن إعادة الاعتبار للقطاعات التي تخلق القيمة ومواجهة الاحتكارات وتدخل الدولة لدعم الأنشطة المنتجة والتنازل عن سياسات التقشف هي شروط ضرورية لاستعادة "رأسمالية تعمل من أجل الجميع". إلا أن الكتاب لا يشرح كيف يمكن للدولة، وهي الآن ساحة لسيطرة هذه القطاعات المالية والاحتكارية عبر لوبيهات المصالح، خاصة وأنها تمثل أكبر مقرضيها عبر أذون وسندات الخزانة، أن تتحدى مصالحها وتواجهها، ناهينا عن أن يتبرع هؤلاء المستفيدون بالتنازل عن حصة من عوائدهم. "من يروي الحكاية يحكم العالم"، تستشهد مازوكاتو بمقولة الفيلسوف الإغريقي أفلاطون في الإشارة للرواية التي تبرر للطفيليين من صائدي الريع جوائزهم على حساب الناس. وكتابها يتحدى هذه الرواية ويكشف تهافتها. http://www.shorouknews.com/mobile/col...

  12. 5 out of 5

    Marco

    The value of everything addresses a vital question in today's economics. Where does value come from? What is it? Who creates it? Who extracts it? Mazzucato does a great job at exploring the conversation on value through the centuries and arrives at today's economy, touching upon finance, innovation, banking, investing, and the role of the public sector in shaping the long-term direction of our economies beyond being mere referees of the game. This book is highly informative and contributes many The value of everything addresses a vital question in today's economics. Where does value come from? What is it? Who creates it? Who extracts it? Mazzucato does a great job at exploring the conversation on value through the centuries and arrives at today's economy, touching upon finance, innovation, banking, investing, and the role of the public sector in shaping the long-term direction of our economies beyond being mere referees of the game. This book is highly informative and contributes many insights to a vital conversation. What I most enjoyed the book is how thoroughly she addresses the history of economics and how different theories addressed "value" over the centuries. The chapters on Finance and Casino Capitalism are illuminating and a bit frightening as they clearly show how finance has increased its dominion over the 'real economy' over time without necessarily adding much value but most likely (in the author's view) extracting it from other productive sectors. Chapter 7, Extracting value through the innovation economy is another very interesting exploration on intellectual property, where does credit land for major innovations, and the ways in which certain innovative sectors of industry extract vs create value. I found the chapter really interesting and Mazzucato brings home some valid points on how much innovation actually stems from an entrepreneurial state that takes charge of investments while it is private actors who take home the benefits. On this I do have some observations / objections. For one thing, I would have *loved* to see more on the Silicon Valley economy, their business models, and particularly an exploration of how they are structured and where does accumulation vs value distribution occur. Among my questions: - Are companies in the silicon valley built on the premise of value extraction or value creation? - And how could we tell, since Mazzucato's concept is very insightful yet difficult to operationalize or quantify? - Are the so-called unicorn companies built on the necessity of increased wealth/ income inequality disparity between their CEOs and their workers? Chapter 8, Undervaluing the Public Sector, makes a solid case for how unfair the game is for the government: it has only downsides and picks up the blame, while it is most often ignored for the value it produces and it is businesses who take the praise for producing value in society. This is a fundamental asymmetry that Mazzucato elucidates very well. Later in the chapter, two extremes of a government intervention are presented. On one hand, the hands-off government leaves the game unsupervised, neglects to control whether there are rent-seekers and market manipulators, and the game collapses under a market failure. The other extreme, nicknamed by libertarians as government-failure, materializes when government intervenes too much in regulating and taking control, and due to its incompetence, ignorance, or corruption (or any combination of the three) lets the entire economic ship sink. Mazzucato makes no secret in her confidence in a government that is able to steer and nudge the economy and that takes responsibility for long-term visioning. The examples of market failures due to lack of regulations are all too evident to see, and the book makes a compelling case for a government that takes a more proactive stance. At the same time, by the virtue of being Italian myself as is Mazzucato, I have seen very often examples of governments getting too heavily involved in market mechanisms and bringing about inefficiencies, incompetence, and corruption. Government failures are real. One needs only read Luciano Gallino's Il Declino dell'Italia Industriale to see multiple examples of healthy industries that headed downhill the moment the political parties put their eyes and hands on them. It is important to point this out in my view, because while one can easily agree with Mazzucato's central thesis and see how a stronger government is needed to regulate against the excesses of today's disproportionate power of sectors such as finance, I am less confident that the solution could be as easy as simply more government. While the entrepreneurial state is vital in making early investments such as the early days of the internet and new discoveries in the pharmaceutical field, a few questions remain open: where do we get buy-in for a state that invests heavily, in the current climate of tight budgets and high debt/GDP ratio? what kind of vision would be needed to justify such heavier involvement and spending? All in all, a great book that I recommend to make sense of a crucial conversation on value in today's economy.

  13. 5 out of 5

    Ayman

    The Value of Everything This new book by economist Mariana Mazzucato is an interesting take on the fundamentals of Economics 101. I believe, Some elementary finance and economics knowledge is necessary to follow and appreciate this book, however, here is my simplified layman summary: The book starts with a short background on the concepts of production boundary which is the scope of economic activities that are deemed "productive" as developed by classical economists, David Ricardo who considered The Value of Everything This new book by economist Mariana Mazzucato is an interesting take on the fundamentals of Economics 101. I believe, Some elementary finance and economics knowledge is necessary to follow and appreciate this book, however, here is my simplified layman summary: The book starts with a short background on the concepts of production boundary which is the scope of economic activities that are deemed "productive" as developed by classical economists, David Ricardo who considered agriculture as the only productive activity, then, Adam Smith who added manufacturing and finally, Carl Marx who redefined productivity as the value created by labour which provided the theoretical framework for labour and socialist movements worldwide. Classical economics was soon swept away by the neoclassical marginal utility concept which redefined production boundary in modern day economics to include everything that fiches a price in the market. Assuming that the free market is the grand equalizer and evaluator of all economic activity, this is what your Econ 101 professor would have told you on day 1 of the course. However, there are problems with the neoclassical model that equates unproductive value extraction with productive value creation, leading to a world where most of the benefits of economic growth are extracted by wealthy shareholders and investors, leaving nothing to improve stagnating wages of the working class. Mazzucato identified a few areas where this is most visible: 1- The financial sector: Financial sector profits are added to the GDP, so increase in such profits translate into GDP growth, a concept that would have Adam Smith tumbling in his grave because the financial sector is only an enabler to the "real" economy, therefore, the significant growth of profits and salaries in the Financial sector are inefficiencies to reprimand rather than achievements to celebrate. I know this will anger many of my banking friends, but I am happy to debate it, so bring it on ! 2- Financialization of the manufacturing sector: Private Equity, short term profitability targets, share buy backs are levers that top management and shareholders of the real economy companies utilized to extract value out of productive businesses into their pockets instead of investing back in growing their businesses. Business history is full of those companies that were stripped to the bones by predatory ownership and management. 3- Patents and innovation: While innovation is key value addition to real economy, many companies use their innovation edge to extract high rent and no one does it more obscenely than pharmaceuticals. In a way, price based value model of new-classical economics is to blame for that, because drug prices are set based on their value compared to the alternative, which in most cases is life of prolonged suffering or even death. In relation to that alternative any price is not high enough, that's why you see new drugs selling at stratospheric prices, extracting value from the economy to the pockets of big pharma shareholders. Although, a big chunk of this money is used to fund new drugs, the high profits and high salaries in the pharma industry are an indication to the inefficiency of such cycle. In conclusion, Mazzucato is arguing for economists to redefine the production boundary to differentiate between rent extraction growth versus true value addition growth and for governments to set policies that can reverse some of those trends, for example, any company applying for government funding programs, should commit to certain re-investment targets or limiting dividend and share buyback activities. This, in my view is a better approach than progressive taxation on high earners, because it addresses the cause of the income inequality problem rather than treating its symptoms. A great book, although has some annoying repetitions.

  14. 4 out of 5

    Tom Gagne

    I heard an interview with the author on the Brian Lehrer show. Her perspective on "value" leans a little more socialist than mine, but it's healthy to read opinions different from your own. Certainly, her opinions are different than mine, though I can hear echoes of her opinions in comments made by President Obama, Secretary Hillary Clinton, and Senator Bernie Sanders. The book strikes me as a little too idealistic, imagining government and society as a Disney movie, where all the critters chirp I heard an interview with the author on the Brian Lehrer show. Her perspective on "value" leans a little more socialist than mine, but it's healthy to read opinions different from your own. Certainly, her opinions are different than mine, though I can hear echoes of her opinions in comments made by President Obama, Secretary Hillary Clinton, and Senator Bernie Sanders. The book strikes me as a little too idealistic, imagining government and society as a Disney movie, where all the critters chirp and scuttle about happily with Snow White (labor and the government) while the evil queen (capitalism, entrepreneurs, etc.) plots to put Snow White to sleep and rape the forest's timber for her mill. The chapters set up a series of straw man arguments plucked mostly from recent press villains as examples of capitalism gone wrong. Each successful business profiting at the expense of the government and its citizens in a zero-sum game where consumers and workers aren't free to make their own choices. She seems conflicted about the relationship between price and value. It's immoral when some actors price for value (drug companies), but moral when others do it (government). The book complains that technologies like the internet, microwaves, and GPS were all funded by the government with public dollars, but the companies that make profits with consumer products using those technologies are "extracting" their profits from public dollars, not adding value. The book's economics are very zero-sum. No one can make money or create value. I would have gotten more out of the book had the author spent more time arguing her points rather than just criticizing capitalism. For instance, the chapter discussing the "Keynesian multiplier" just mentioned there were critics of the idea, but didn't explore the criticisms. In this specific case, Bastiat's Broken Window Fallacy was screaming at me while the chapter talked about the importance of deficit spending. My suspicion is the book could have been more persuasive had it argued its points rather than, well, not arguing them.

  15. 5 out of 5

    Jökull Auðunsson

    Milestone work for the new left movement Maybe it’s a case of just being too familiar with many of the arguments in this book, but I found the book stretch slightly too many words over the otherwise very important agenda and I found myself at times skimming sections. I had already read Doing Capitalism by Bill Janeway, which has similar threads, and I had already watched YouTube videos and followed Mariana on Twitter. Nevertheless, this is a milestone work for a modern political movement — The Ne Milestone work for the new left movement Maybe it’s a case of just being too familiar with many of the arguments in this book, but I found the book stretch slightly too many words over the otherwise very important agenda and I found myself at times skimming sections. I had already read Doing Capitalism by Bill Janeway, which has similar threads, and I had already watched YouTube videos and followed Mariana on Twitter. Nevertheless, this is a milestone work for a modern political movement — The New Green Deal (US) or DiEM25 (EU). Participants or sympathisers of those political movements will find fresh narratives, historical anecdotes or theoretical basis to push an important agenda. My notes: There is a defensive structure to the book. It traces history of value theory, and puts together a logically constistent framework to convince the reader that markets are created and managed by states (as opposed to existing and the state being in the way of its natural efficiency), and that therefore value is whatever we choose. Rewarding rent seekers begets rent seekers, rewarding finance by accounting for its transactions in GDP results in an emboldened and ballooning finance sector, etc. From here the book goes into different directions to show how the Chicago school of economic thought, fascinated with the elegant simplicity of the naive marginal value theory, has resulted in the hollowing out of a state apparatus that has increasingly guided its decions using the same theory of value, ignoring more important agenda, such as sustainability and distribution of opportunity.

  16. 4 out of 5

    Maurício Linhares

    How do we define value? Mariana goes through the multiple definitions of value and how we've tortured both the original economy texts and today's numbers to come up with today's reasoning about what a price is and where it comes from. The book also goes through how we ended up with the overly complex financial system we have today and how banks and their friends make use of this to keep the economy and governments hostage of their whims, specially after the removal of the limits that were placed How do we define value? Mariana goes through the multiple definitions of value and how we've tortured both the original economy texts and today's numbers to come up with today's reasoning about what a price is and where it comes from. The book also goes through how we ended up with the overly complex financial system we have today and how banks and their friends make use of this to keep the economy and governments hostage of their whims, specially after the removal of the limits that were placed on them after the previous financial crises. It also talks about how patents and copyrights are actually hurting the economy by creating the wrong incentives and producing payoffs only to businesses that are mostly performing rent seeking, moving value around, instead of investing and creating new value. And then there's government. The most important piece of the book is how the demonization of government created the environment we have today and how creative accounting and media produced the idea people have nowadays that government doesn't do anything useful when in fact it is behind most of the development we've seen in a way or another. Worse, how the whole privatization movement saddled the population with the turds and gave away the profit makers to private entities that were ready to profit from them. It is eye opening and a great read if you'd like to know more about the economy and the direction we're going today.

  17. 4 out of 5

    Ola Helmich Borchgrevink Pedersen

    I believe Mazzucato touches upon some of the central issues for our economy: the distinction between creating (profits on earned income) and extracting value (rents from unearned income). This has been a crucial debate and a central issue for economics for centuries. However, there is not much debate around the now dominating value theory (or rather, price theory) of Neoclassical economics. Hence, this is also an important critique of contemporary mainstream economics. She applies her analysis o I believe Mazzucato touches upon some of the central issues for our economy: the distinction between creating (profits on earned income) and extracting value (rents from unearned income). This has been a crucial debate and a central issue for economics for centuries. However, there is not much debate around the now dominating value theory (or rather, price theory) of Neoclassical economics. Hence, this is also an important critique of contemporary mainstream economics. She applies her analysis on pressing issues like financialization, big pharma and the digital economy. Her depth of analysis and concrete examples makes the argument on these economic sectors very convincing. However, the big issue of the arguemnt is that Mazzucato do not provide a consistent theory of value herself. She points out this herself and tells us that the aim is rather to start a debate on value and the creation and extraction of it. That is all fine, but a debate is not enough. Not having a clear and consistent theoretical framework makes sound analysis hard to conduct. We should, therefore, hope for a second volume of this book.

  18. 5 out of 5

    Gabriel C.

    Somewhat tedious at points, very repetitive in its main messaging, often overly focused on economico-historical minutiae (particularly, I felt, anything touching Marx) or on the details of particular examples. But for all that clear and incisive about the main point, which is laid out plainly in seemingly ironclad form (N.B.: I am not competent to judge economic arguments). To wit, the notion of value is historically contingent but it has become a point of ideology in service of various vested in Somewhat tedious at points, very repetitive in its main messaging, often overly focused on economico-historical minutiae (particularly, I felt, anything touching Marx) or on the details of particular examples. But for all that clear and incisive about the main point, which is laid out plainly in seemingly ironclad form (N.B.: I am not competent to judge economic arguments). To wit, the notion of value is historically contingent but it has become a point of ideology in service of various vested interests that measuring value by price is objective and provides a good approximation. Mazzucato argues quite convincingly that it is not. In particular she provides plenty of examples of "value-creating" actions that are disruptive and destructive and plenty of examples of prices that fail to reflect value in any meaningful way other than by the funhouse yardstick of prices themselves.

  19. 5 out of 5

    Richard Muthua

    The last three chapters will probably become a reference point for many people (including myself) questioning the dominant political economic frameworks in use today. I would highly recommend to anyone (left, right, centre...) remotely interested in the fundamental questions of trying to figure out the mystery of how the economy works, why it works that way and what type of actions need to happen for fundamental change.

  20. 4 out of 5

    Kevin Y

    Simply put: the book does what the author says - start a debate and dialogue about the concept of economic value. It is a good review of many past economic debates but also bringing forward the inherent built in assumptions.

  21. 5 out of 5

    Theodore Kinni

    Our assumptions about what economic value is, how it is generated, and who generates it play a major role in determining the economic playing field we end up on, argues Mazzucato. Here she shows how today's assumptions give the few license to steal value generated by the many.

  22. 5 out of 5

    Frank

    This is a highly readable book of economic thought for the average lay reader. Much of what Mazzucato says is enlightening to the non-economist. It's easy to see why the author's thoughts are controversial though among those steeped in economics.

  23. 5 out of 5

    Matt Porter

    A pretty interesting read on what's wrong with modern capitalism. What's wrong is that the private sector over emphasizes value-extraction while Government spending is maligned. Mazzucato's idea is clear and it's a easy read.

  24. 4 out of 5

    Ivank

    This book is incredibly dry

  25. 4 out of 5

    Ilinca

    You need a grain of salt with this, but it's an important and balanced contribution to the discussion of public funding vs private money in how society is run.

  26. 4 out of 5

    David Hallam

    Very readable (always a bonus for an Economics book) and very much on trend. As I was reading it I kept hearing news stories and discussions that pertained the same ideas.

  27. 5 out of 5

    Martha

    This review has been hidden because it contains spoilers. To view it, click here. LOTS to take in. Not an easy read, but very informative.

  28. 5 out of 5

    Allan J

    A significant book Not always an easy read but well worth reading cover to cover. Now amazon demands another eight words, seven, eight.

  29. 5 out of 5

    Jacopo

    Inspiring

  30. 4 out of 5

    Ken Hamner

    Very insightful book. Highly recommended.

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