348. Is the Government More Entrepreneurial Than You Think?

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🗓️ 6 September 2018

⏱️ 35 minutes

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Summary

We all know the standard story: our economy would be more dynamic if only the government would get out of the way. The economist Mariana Mazzucato says we’ve got that story backward. She argues that the government, by funding so much early-stage research, is hugely responsible for big successes in tech, pharma, energy, and more. But the government also does a terrible job in claiming credit — and, more important, getting a return on its investment.

Transcript

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0:00.0	So I wouldn't say that my path to economics was through Marxism, but it was through reading
0:06.0	some very inspirational economists of which one was definitely Karl Marx.
0:11.0	That's Maryana Matsukado.
0:14.0	I'm a professor in the Economics of Innovation and Public Value at University College London.
0:19.0	You also advise as far as I can tell a number of governments and governmental institutions?
0:25.0	Sure, so I'm currently on the Council of Economic Advisors for the First Minister of Scotland.
0:30.0	I'm also the Special Advisor for Carlos Modash, who is the Research Commissioner in the European Union.
0:36.0	And I used to be on the Advisory Board for Jeremy Corbyn, and then I resigned because of Brexit.
0:45.0	It says here a Special Advisor to the Secretary General of the OECD, is that right?
0:49.0	Yes, so the OECD is currently rethinking its economic narrative, and so they have a group that's literally called that, the new economic narrative.
0:57.0	And I'm one of the people on that group.
1:00.0	Gotcha. And also Citrus Advisory Panel in Finland? Is that true?
1:05.0	Oh, yeah, sorry. I didn't realize you wanted the whole list. Yes.
1:08.0	There's actually even like 30 more.
1:12.0	How can it be that one university economist has the ear of so many governments and institutions?
1:17.0	For a clue, let's get back to why Matsukato found such inspiration in Karl Marx.
1:24.0	One thing that's fascinating about Marx is that he's known as a critic of capitalism.
1:29.0	But actually when you read Capital, volume 1, 2, and 3, you end up really admiring and appreciating the dynamic aspect of capitalism, which is technological change.
1:39.0	We shouldn't forget that feudalism was 500 years of inertia. One of the defining features of capitalism is in fact the way that innovation has really broken down all sorts of walls.
1:49.0	That is constantly changing how industries operate, how production, distribution, and consumption work. And Marx really talks about that.
1:58.0	So it's quite curious that one of the most famous critics of capitalism actually described it in the most dynamic of all ways.
2:05.0	And that's what got me interested in the economics of technological change.
	...

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