From 1945 to 1948, the United States represented an unparalleled productivity machine. It had an educated workforce, advanced production techniques, well-organized institutions, and relative stability. A period of huge growth ensued—one that greatly benefited workers. "It was a virtuous circle that worked well for a long time," said Luigi Zingales, Robert C. McCormack Professor of Entrepreneurship and Finance.
But other countries soon learned from its efficiency, and in recent years, the unfettered influence of business lobbyists has further eroded confidence in the US system. The last quarter-century has brought the largest creation of wealth in history, Zingales noted, but it has occurred mostly in developing nations.
The once-robust underpinnings of American success are getting weaker, Zingales told a group of Booth students at Gleacher Center during a Myron Scholes Global Markets Forum event organized by the Initiative on Global Markets. But the trend is not irreversible. In a plea to bolster free markets and not big business, he shared insights from his new book, A Capitalism for the People: Recapturing the Lost Genius of American Prosperity.
Luigi Zingales is the Robert C. McCormack Professor of Entrepreneurship and Finance at the University of Chicago's Booth School of Business. He is a faculty research fellow for the National Bureau of Economic Research, a research fellow for the Center for Economic Policy Research and a fellow for the European Governance Institute. He is the Lead Independent Director of Telecom Italia and the Vice President of the American Finance Association. He is the co-author of Saving Capitalism from the Capitalists and a contributing editor of City Journal. He lives in Chicago with his wife and children. (on Project Syndicate)
J. Bradford DeLong, University of California, Berkeley
“More than 30 years ago, Milton and Rose Director Friedman raised high the banner of small-government free-market libertarianism with their Free to Choose. Now, a generation later, income inequality is substantially higher, the globe is even more interconnected, and our partial financial deregulation has backfired badly. Luigi Zingales thus has a harder task as he tries to update the small-government free-market libertarian position for the 21st century. But he has done a very good job at it.”
Robert J. Shiller (Yale SOM), author of Finance and the Good Society
“This remarkably creative book, driven by a strong moral conviction, offers a bold array of ideas for us to ponder, so we can really make the American capitalist model work better for everyone.”
Edmund S. Phelps, Director, Center on Capitalism and Society, Columbia University
“In A Capitalism for the People, Luigi Zingales joins the small but influential group of economists who see that America’s economy is now more and more corporatist, less and less capitalist. His impressive account of our downhill slide is enriched by his deep knowledge of the harm wrought by the worst excesses of Italian crony capitalism. A must-read.”
N. Gregory Mankiw, Robert M. Beren Professor of Economics, Harvard University, and author of Principles of Economics
“A Capitalism for the People is a wise, deep, and timely book. With lively prose, Zingales diagnoses what is right and wrong with the U.S. economy. Whether your political sympathies lie with the Tea Party, Occupy Wall Street, or someplace in between, you will learn much about how we can best promote an economic future that works for all of us.”