Economists for Inclusive Prosperity

The co-directors of this new institution are Suresh Naidu, Dani Rodrik, and Gabriel Zucman.  Here is the Twitter announcement.  Here is an 87-pp. eBook introduction, ungated and free, with a short and readable introduction.  Here is a brief excerpt:

This is a time when we need new ideas for policy. We think economists, among other social scientists, have a responsibility to be part of the solution, and that mainstream economics – the kind of economics that is practiced in the leading academic centers of the country – is indispensable for generating useful policy ideas. Much of this work is already being done. In our daily grind as professional economists, we see a lot of policy ideas being discussed in seminar rooms, policy forums, and social media. There is considerable ferment in economics that is often not visible to outsiders. At the same time, the sociology of the profession – career incentives, norms, socialization patterns – often mitigates against adequate engagement with the world of policy, especially on the part of younger academic economists.

Comments

“Mitigates against”? Yuck!

The correct term is "militates against."

"pro idea"!!
so these must be
the postmodern money theorist/charlatan/chartalists?

It is not as if anybody needed more reasons to have no respect for the field.

"Inclusive Prosperity"--sounds eminently academic.

If "democratic socialism" poses such fashionable appeal, why don't our academic stooges coin something catchy . . . like "democratic capitalism"?

Inclusive is definitely the premier buzzword of our time. One buzzword to rule them all.

What a charming intellectual fashion to entertain ourselves with!

To hell, frankly, with the numerous competing "as-if" worlds that American academic imbeciles and Tech Sector cheerleaders are keen to construct and foist upon us all: to hell, that is, with any and all visions of "omnitude" crafted and marketed by our Brainiac Class.

The leading egalitarian principle active in human affairs is DEATH--fully egalitarian and completely indifferent to individual assertion. What might explain our modern impatience with biocide?

"Inclusive Prosperity"

I would guess that it means I've got mine, and I don't mind if you have some too.

As Jeff R observed above "inclusive" seems the chief offender here.

The fashionable term may suggest comity between the Including Class and the (deserving if not grateful) Included Classes, but because human agency merits no mention and seems to count for nothing, the notion looks like another grand scheme for engendering even MORE American passivity ("inclusive prosperity" sounds every bit the passive construction as "wealth sharing"--on this reading "exertion" is as much a crime as "independence").

Perhaps, but be careful not to sail too close to greed, as a simple antonym.

I was always a fan of Spock's "live long and prosper." I have raised it as a desirable goal, that everyone should. I've even mumbled a few words in those situations about prosperity having a broad meaning..

"While prosperity is the traditional concern of economists, the “inclusive” modifier demands both that we consider the whole distribution of outcomes, not simply the average, and that we consider prosperity broadly, including non-pecuniary sources of well-being.."

This thing might be up my alley. Live long and prosper, you guys.

It's equality of outcome at the group level.

How many pages are you in?

After skipping around I'm only on pg 5 of a straight read, but I don't see that at all.

We are due a few more rainy days, which give me hope to finish the darn thing.

You might be having a knee jerk reaction. Just because someone uses the word "inclusive" doesn't mean they share 100% of the philosophical views of the most extreme examples of people who use the word "inclusive".

Nevermind. I read it. You're not.

That's not really fair. It is different. It is certainly not libertarian, and it does challenge someone with neoliberal foundations like me, but I don't think this cluster of proposals match to any specific political tribe.

I'm on Zucman's corporate tax piece now, which does seem to address a real problem. Nuts and bolts.

Read CMOT's comment below. It's all about unions.

Suresh Naidu wrote what looks like an interesting piece on unions. I haven't read it in full yet, but this isn't the first time I've heard that historical evidence says "wait a minute.." a bit too late for unions.

As I was coming up unions were taking about the worst press. Need a union guy to change a light bulb. Need a prop man when the play has no props, and so on. I was a bit chagrined when high school kid at the hardware store I had to join the Teamsters. And of course I did embark on a high paying bid-and-ask career.

Looking back and integrating what I know of the new data, I'm less sure that "unions are bad" should have been the full take-away.

If you don't have unions, what will you have? A naked faith that the market provides for everyone, right on down the skills (and IQ) curve?

"The market" is just a bunch of other people making decisions, same as you. Nothing wrong with unions if they are voluntary and don't receive government backing. People should be encouraged to hedge their bets and have multiple layers of backup skills so they can easily switch employers. All guarentees of job security are illusions. You think that large company is going to be around forever, so you can unionize and demand a bigger share of the profits? Think again.

Right, the market is just decisions, and people living in cars are just outcomes.

I would say the Inclusive Prosperity people want to put more focus on outcomes.

Like the outcomes for all those poor people who can now afford to buy clothing for a fraction of the cost? Clothing is so cheap today that thrift stores are going out of business. Walmart is distained by elites who fetishize old fashioned small town life, but it's a major boon to the actually poor.

Well, actually what they mean by "inclusive" is "of union members". It's not about race or sex at all.

Those of us who can command high wages in a bid and ask setting may have a skewed view. There probably are more market and social failures in the bottom 30%. Especially when that job goes to China.

Even as a neoliberal, I can recognize that market fundamentalism is often bound to a certain sacrifice of "other people."
There is a fairly broad believe that creative destruction has to happen on a personal level. That some people do have to end up living in cars, to preserve the market.

Well, that's a strange comment when we're in the middle of a period when it's the White Working Class who think they have been sacrificed. But who do you think is buying all those Chinese imports at Walmart?
Gains due to trade and specialization are broad based because there is no filter on who gets to buy things at retail. Everyone benefits equally from cheaper consumer prices. But the people who gain the most from protectionism - those people are more likely to be the people who can muster the political power to bend politicians to their will. I.e. the white working class.

I've said it before, and I'll say it again: When Trump was elected that was White Privilege in action.

That's actually a key theme to this work, I think. That Trump's election was an inelegant and ineffective way to deal with very real problems.

What? Falling consumer prices so that the bottom 30% can afford a rising standard of living is a problem? Why is that a problem? Personally I'm not getting the sense that minorities are significantly worse off economically than they were 30 years ago. I'm not getting that sense at all. Quite the opposite.

There were very real labor dislocations when manufacturing moved to Asia.

That was real.

MAGA was a very unserious and slipshod response, but it had the one advantage of avoiding anything that sounded too liberal.

Rather than actually dealing with minimum wages, we build a wall and let people go on about how the wall will keep wages up.

Stupid, slipshod, ineffective.

Well, let's look at where those labor dislocations were concentrated: in midwestern/northeastern areas - areas with a lot of unionization and strong support for unionization from state governments. They weren't in the South, or the West, which are doing rather well economically. Of course, that is exactly why all those former union guys hated NAFTA, becauset hey knew they had a sweet deal with the laws granting them a favored status in society by compelling other Americans to buy their products. But attendent on all that dislocation is, of course, the benefits delivered to the no-longer-captive American markets, markets composed of people who aren't midwestern union guys. What is the opposite of dislocation anyway? Is there a word for that? Liberation maybe?

I am just starting Rodrik's contribution, "Towards a More Inclusive Globalization:
An Anti-Social Dumping Scheme."

What I expect to find is that while free trade is good, pace of change might be slowed so as to reduce dislocation. Here we go..

>"They weren't in the South."

That is not true. Southern furniture and leather makers were among the hardest hit. It is in the literature.

More likely it'll mutate into "Hey, you've got mine!"

Translation: economics should try harder to rationalize policies that are consistent with our worldview instead of taking a value-neutral approach.

Because the rest of the social sciences have set such a great precedent by doing so.

Inclusive prosperity. Does that mean adopting the China model per David Brooks's column in today's NYT? The Green New Deal per the New Democrats? Meanwhile, in the real world, the economists in the current administration promote a non-inclusive prosperity. But it's refreshing that some economists (Rodrik among them) are willing to deviate from orthodoxy. I doubt many will follow. As my earlier comment about Brooks's column suggests, Brooks wants to deviate from orthodoxy because orthodoxy may not for long benefit his friends who share his ideology. China is changing America and American orthodoxy. Who knew it would come to this?

I did. A lot to be said of China, and ideology has got nothing to do with it. It is a sad day when metaphysical revolutions around meaning are being explained away with a head shake and a hand shake (on good days its like a tri-delt with a trident). As Arthur Koestler wrote, "Satan, on the contrary, is thin, ascetic and a fanatical devotee of logic." It's like looking at a graph of the rupee pegged to the yuan. And the noise is the worst part.

That David Brooks column is nuts.

* "and it is way ahead of us on technologies like facial and speech recognition." (lol)

* "China’s artificial intelligence industry has grown by 67 percent over the past year and has produced more patents than its U.S. counterparts" (the number of patents is almost irrelevant)

* "One estimate suggests China is investing as much as 30 times more capital in quantum computing than the U.S" (a meaningless statement)

* "This is not competition. This is replacement." (meaningless scare mongering)

* " If China can set the standard for 5G communication and dominate artificial intelligence and quantum computing, then it will be able to write the rules and penetrate the fibers of our society and our lives in ways that we cannot match." (Just as ridiculous as the NY Times article was a couple of weeks ago on this by David Sanger.)

* "“This report’s central conclusion is that the U.S. cannot escape or avoid decisions about industrial policy.” (And this is what it is really about - going back to 1989 to 1993 when unstoppable Japan freaked out American policy makers.)

David Brooks... As if 30x the number of competent quantum computing researchers can suddenly be conjured from thin air.

There is an overproduction of science phds that is causing all kinds of problems in academia. If the US government wants to compete with China, it may need moon mission style programs to keep America's competitive edge. The private sector just isn't there yet to absorb all the talent. Reading about material scientists in battery technology that can't find a job in the US is a terrible thing. Reminds of that math whiz who made a fundamental contribution to number theory but was working at a Subway making meatball subs.

This is a serious op-ed since it mentions PATENT four times, better than the usual op-ed that talks about what's important to technology but doesn't mention IP even once. I also found it interesting that Karl Polanyi was mentioned twice. -RL

(Wikipedia): Karl Paul Polanyi (/poʊˈlænji/; Hungarian: Polányi Károly [ˈpolaːɲi ˈkaːroj]; October 25, 1886 – April 23, 1964)[1] was an Austro-Hungarian economic historian, economic anthropologist, economic sociologist, political economist, historical sociologist and social philosopher. He is known for his opposition to traditional economic thought and for his book, The Great Transformation, which argued that the emergence of market-based societies in modern Europe was not inevitable but historically contingent. Polanyi is remembered today as the originator of substantivism, a cultural approach to economics, which emphasized the way economies are embedded in society and culture. This view ran counter to mainstream economics but is popular in anthropology, economic history, economic sociology and political science.

It is not especially kind to patents in those four mentions. It recognizes that they are one option for public policy, and one with downsides.

"the value of monopolies granted by the patent system is intrinsically inegalitarian"

Heck of a soundbite.

it is not the monopoly game is a bad game to play. after all there is great hypothetical value in the beast and the burdens weigh though in increments. it is instead as cowan has taught us, that the greater bear is entanglement, and through failure and thorough review, management is truly accounted for. one can process however one chooses but a billionare is by definition a utilitarian. as much as any machinist.

@a clockwork orange - very poetic prose, you have a bright future as an artist, or as a random sentence generator.

If anything, intellectual property laws need to be dialed back to speed up innovation. Otherwise businesses get the liability but the money goes to lawyers and innovation slows to a crawl because everybody is scared. Too often IP laws are used as rent-seeking. Patent trolls who just sit on a patent with no path to product while waiting with baited breath in an East Texas courthouse are the worst of the worst. China respects IP laws like Trump respects women and their economy is riding high. China is practical about this. What's the point of ideas if it doesn't become a product in the hands of consumers at a good price? Points to consider.

damn

File under, 2019 continues the trend of the Western world becoming worse than the year before.

I have very little faith in economists producing policy ideas.

(Telling other people why their pet plans won't work because of the gods of the copybook headings, maybe.

But that's not sexy, so they wont' do that.)

As mentioned above, this makes me assume they'll bend economics to their extant preferences, not the other way around.

Economists, to paraphrase, must be “part of the solution“. The solution to what? Is inclusivity-exclusivity a hint?

What do economists do? I.e., what are their students taught in the lectures halls down the corridor? Don’t the impart the tools to build the models to dispassionately look at the data and tell us what will work and not work? Or is that the orthodoxy they must be surpassed?

Cowen defends the exclusivity of universities such as Harvard. The social elites at universities such as Harvard, need to replicate their identity, culture, legacy, at the expense of the identity, culture, and legacy of outsiders. They use an extremely exclusive and secretive admission policy, and they don't owe others answers as to whom they choose and whom they reject:

https://www.bloomberg.com/opinion/articles/2018-11-01/let-harvard-be-harvard-only-bigger

> Step back from the emotions of the current debate and start with the general point that social elites need to replicate themselves, one way or another. Otherwise they tend to fade away; think of the leaders and institutions of the temperance movement. Harvard, in contrast, is still one of America’s leading universities almost four centuries after being established.

In this post, when I hear exclusive prosperity, I presume the reference is to greater rights of migration and less rights of people to preserve the identity, culture, and legacy traditionally associated with current nations.

Why do the "social elites" at universities have this right to be ultra exclusive, and privilege their legacy and identity, yet the regular citizens of a nation state do not?

edit: That should have been "when I hear *inclusive* prosperity"

That's a good catch, and the way I would thread these ideas: Harvard should double it's student body, but state schools in the hinterlands should compete hard against Harvard as well. Inclusive prosperity should mean many paths to success. Regular citizens of a nation or small town shouldn't close down any of those paths, but should open as many as possible.

"Inclusive Prosperity"

... Tyler prefers the term "Pluralism"

They are Socialists for Inclusive Prosperity. They center on how a "government" that has never existed can promote what they call Inclusive Prosperity. They write as if they have never heard about how governments perform and why they have been performing much worse than what apparently they acknowledge. They intentionally ignore that THEIR solution involves big changes in the institutions of politics and government. Indeed, they don't care about what we know about government. They believe that what matters is to be elected or selected regardless of how the election or the selection is won. They don't want to lose their privileges as professors so they are trying to sell their services to career politicians. And if to benefit personally from selling them they have to trash what their colleagues are doing, well that's not their problem. They are expecting to hear soon from the decrepit candidates that are competing with young AOC.

Can't get past the first paragraph. Piles of horse$hit claims that can't possibly be substantiated.

There's only 3 real ideas here - more government taxes and spending, cargo cult unionism, and a universal basic income.

The central role they give to unions - their trade section is based on outsourcing trade policy to unions, their labor section is about herding workers into unions, their democracy plan is allow unions to dominate elections, and their 'wage boards' are also (surprise!) about unions.

What is with these people and this particular cargo cult?

Ahh, no wonder this plan seems carefully tuned to maximize the amount of corruption involved - it was written by unions.

Worker representation in trade negotiations sounds novel, but is it really worse that status quo? Either status quo really, the free trade globalization we had, or the recent attempt to patch it all up with "better deals" between heads of state?

Yes, it is much, much worse. Free trade globalization was working great and enriching everyone. Unions are the classic crony capitalists and they would seek protectionism even if it means impoverishing the country by using government power to step on the neck of free commerce

Ok I skimmed through it.

A bunch of technocratic hogswallop.
As if one minimum wage doesn't fuck things up enough, they want to institute "wage boards" to micromanage minimum wages on an industry specific basis.

If I wanted to devise a system to maximize rent seeking and bribery, it's hard to imagine how I could do worse. It's almost like a deliberate plan to invent jobs for mid-level economists to sit around and push paper while being fed kickbacks from union and industry officials.

First, I think you misinterpret this bundle if you think it is a political party and every item is a board in the platform.

Second, while I too would be unlikely to support wage boards in America, I like the way this challenges my thinking on the way wages are set at the bottom of the market.

Generic low-skilled workers have low ability to command a wage. Minimum wages and the Earned Income Tax Credit are one to answer this, but not necessarily the last or the best.

"Generic low-skilled workers have low ability to command a wage."

Nonsense. Nobody has any ability to "command" a wage. They either take the wage that is on offer or they don't.

Right, your walking away from Petsmart will teach them alright.

"There is considerable ferment in economics that is often not visible to outsiders. "
There's a few good ideas in the blueprint, but "Ferment" is too strong a description.

"mainstream economics ... is indispensable for generating useful policy ideas": ho hum. I have at last had a read of Greg Clark's 'A Farewell to Alms'. He is (or was) of the view that mainstream economics is quite hopeless as a guide to policy, particularly for policy related to backward countries. And yet nothing can be "inclusive" if it doesn't aim at a huge boost in income in, for example, subSaharan Africa.

“Leave no sub-Saharan citizen behind!” (In principle, yes. Ideally everyone benefits and have a satisfying life. Now what polities are successful and what made them so and how do we scale and replicate these?

"Inclusive prosperity" - Another phrase for forced corporate/individual social responsibility. Everyone wants to be champion of poor.
And Dani Rodrik & Co. want to stay abreast of competition.

Phase out all Federal poverty programs over 18 years.

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