[EconTalk] Mariana Mazzucato on the Value of Everything

Mariana Mazzucato on the Value of Everything

24/12/2018 by EconTalk: Russ Roberts

Web player: http://podplayer.net/?id=60810059
Episode: http://files.libertyfund.org/econtalk/y2018/Mazzucatovalue.mp3

Economist and author Mariana Mazzucato talks about her book The Value of Everything with EconTalk host Russ Roberts. Mazzucato argues that economists have mismeasured value and have failed to appreciate the role of government as innovator. She argues for a more active role for government in the innovation process and for government to share in revenue proportional to its role in the creation of new technology.

Listen Date: 2019-02-15

The two major points of interest in this episode were Prof Mazzucato’s claim that a step beyond basic or pure research; there is a large space of applied research projects which the private sector refuses to invest in, or take up as a venture; and so this is a space for government to be active; and the second was that as a counterweight to patent monopolies; government investing into private sector should come with more terms and conditions; such as reinvestment, price controls, or shares to government.

On the first point, there was really no evidence provided; though that might have been the fault of Prof Roberts for chasing distractions, and Prof Mazzucato’s own work might make a more explicit case.

On the second point, speaking not as an economics professor, but as a slightly cynical individual, these were my thoughts:

  1. Forced reinvestment could very well lead to gold plating projects
  2. Price controls or any other marketing covenants are also distortionary, but I don’t know how much more than the gold plating that would come out of forced reinvestment
  3. Taking up an equity stake might just work, if it was done through a sovereign wealth fund, where best practices already seem to be emerging.

 

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