Over the last five decades, an empirical revolution in economics has undermined many of the assumptions of “neoliberalism,” the reigning approach to economic policy. Many of the guiding assumptions underlying neoliberal policymaking no longer speak to what is going on in the economy or our country more broadly.
In “The Empirical Failures of Neoliberalism,” Mike Konczal, Katy Milani, and Ariel Evans elevate five of the leading arguments made by advocates of neoliberalism and explore their theoretical claims. Ultimately, the authors debunk neoliberals’ arguments, tracking them against recent research by leading scholars of economic inequality to show how neoliberalism has failed to deliver its promises of increased economic growth, equality, and mobility.
By elevating the leading empirics that turn neoliberalism’s theoretical claims on their head, this issue brief aims to energize a thoughtful reevaluation of the dominant—but failed—ideology. Konczal, Milani, and Evans lay the foundation for a new set of economic policies that are capable of building a stronger, more inclusive economy and democracy—by curbing the concentrated power in our economy and political system while also building on the strengths of government to directly address both the individual and collective challenges facing our nation.
GROWTH, INEQUALITY, AND MOBILITY
Advocates of deregulation promised both more efficient markets and economic growth (as measured by gross domestic product) that would “trickle down” to benefit the economy as a whole. Such an approach, they promised, would be like a risingtide that lifts all boats. Contrary to the theory, however, regressive policies, including lower tax rates for corporations and the already wealthy, deregulation, and privatization, have resulted in slower growth, greater income inequality, wage stagnation, and decreased labor market mobility.
THE EMPIRICAL FAILURES OF Neoliberalism, by Mike Konczal, Katy Milani, and Ariel Evans
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