Eighteenth-century philosopher Adam Smith, the father of market economics, wrote about how different economic and business activities contribute to countries’ overall well-being. But modern-day neoclassical economics has largely sidelined this scrutiny to focus on market price as the only measure of value, according to professor Mariana Mazzucato. In this perceptive work, she details how the dichotomy between price and value leaves society at the mercy of “value extractors” and places the social good on a back burner. Mazzucato puts forward important ideas that challenge the accepted economic wisdom and that offer a broader, more inclusive conception of value. Although the book meanders at times, it has a strong central message: If they want to change an economic system, people should first understand its objectives and how different actors or sectors add value to it. Her thought-provoking writing will engage readers concerned about the path of economies in contemporary times.
In this summary, you will learn
- How the field of economics changed society’s conception of value,
- Why economics needs to readjust its theories about price and value, and
- How understanding value can help people change the economic system.
About the Author
Mariana Mazzucato is an economics professor at University College London. The author of The Entrepreneurial State, she was named one of the “three most important thinkers about innovation” by The New Republic.