Mariana Mazzucato — STATE VS. MARKETS: A MISLEADING DICHOTOMY

The debate about the relative roles of the state and the market in capitalist economies tends to swing from side to side in the hearts and minds of public opinion: periods when the state is defended for its role in economic development are always superseded by an attack on its intervention into ‘well functioning’ markets. It has been like this throughout the twentieth century. And it is what has happened since the most recent global financial crisis and economic recession: a brief period right after its outbreak, when there was consensus that the state had a key role to play in both saving the banks and using fiscal policy to promote growth, was quickly apprehended by those who feared rising levels of public debt. Indeed, this debt was mistakenly seen as the cause rather than the result of the crisis—due to lower tax receipts, rising bailouts, etc. So austerity became again the flavour of the day, while any sort of serious economic and industrial policy became anathema.

What is missing from the public perception is how through the history of modern capitalism, the state has done, and continues to do, what markets simply won’t. This is not about its role in simply fixing ‘market failures’, but its role in directly shaping and creating markets.…

MARIANA MAZZUCATO — Economics - Innovation - Inclusive Growth
STATE VS. MARKETS: A MISLEADING DICHOTOMY

Mariana Mazzucato | RM Phillips chair in the Economics of Innovation at SPRU in the University of Sussex

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David F. Ruccio — “What free enterprise is all about”

Dwight B. Billings, Distinguished Professor of Arts and Sciences at the University of Kentucky and former President of the Appalachian Studies Association, published the following letter to the editor in the Lexington Herald-Leader in the response to the university’s recent decision to accept Koch brothers’ money to establish the John H. Schnatter Institute for the Study of Free Enterprise:

Occasional Links & Commentary
“What free enterprise is all about”
David F. Ruccio | Professor of Economics, University of Notre Dame

Glenn Greenwald — Two lessons from the Megaupload seizure

Read it at Salon
Two lessons from the Megaupload seizure
by Glenn Greenwald
(h/t Kevin Fathi via email)

(1) It’s wildly under-appreciated how unrestrained is the Government’s power to do what it wants, and how little effect these debates over various proposed laws have on that power.

(2) The U.S. really is a society that simply no longer believes in due process: once the defining feature of American freedom that is now scorned as some sort of fringe, radical, academic doctrine. That is not hyperbole.

Here's the crux of it:

...what distinguishes a tyrannical society from a free one is whether the government is first required to prove guilt in a fair, adversarial proceeding. This is a precept Americans were once taught about why their country was superior, was reflexively understood, and was enshrined as the core political principle: “no person shall be deprived of life, liberty, or property, without due process of law.” It’s simply not a principle that is believed in any longer, and therefore is not remotely observed.

It is simply not possible to have free enterprise in a tyrannical society. The US is kneecapping itself. Eventually this leads to powerful interests taking down competition politically, thereby stifling innovation.

Joseph Schumpeter saw the risk to capitalism as late-stage capitalism stifling innovation.

Free enterprise goes viral globally

The entrepreneurial bug appears to be spreading globally. According to the latest Global Entrepreneurship Monitor from Babson College, there are nearly 400 million active entrepreneurs around the world.

The annual survey polled 140,000 adults ages 18 to 64 from 54 different economies. GEM estimates that 163 million are women early-stage entrepreneurs, 165 million are young early-stage entrepreneurs (18 to 35 years old), 65 million entrepreneurs plan on creating 20 or more jobs in the next five years, and 69 million offer innovative products or services that are new to the market.The study reviews entrepreneurship based on three standards: inclusiveness, industry and impact. The amount of opportunity entrepreneurs have, their gender, the industry they choose and how they affect their societies also help determine how successful entrepreneurial ventures might be.

"In an economy, you want to have some elements of stability, where firms maintain their businesses, despite facing ups and downs in their industry, their businesses or in the economy over time," Donna Kelley, Babson College professor and the study's author, explained. "At the same time, there needs to be some dynamism, where new ideas and new firms sprout up and replace in part those that have run their course."

Read the rest at The Huffington Post

Global Entrepreneurship Is On The Rise