The Gray Area with Sean Illing "The world’s scariest economist” on coronavirus, innovation, and purpose
May 18, 2020
Mariana Mazzucato, an economist at University College London and author known for her critiques of economic fundamentals, shares her insights on the coronavirus and its impact on essential workers. She argues for reevaluating how society values these roles, highlighting the disparities in compensation. Mazzucato also explores the need for a more innovative public sector inspired by successful models like Singapore, and discusses the government's critical role in funding innovation to address societal needs. Her thought-provoking ideas challenge traditional economic assumptions.
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Shifting Value Theory
- Modern economics assigns value based on price, leading to a tautology where high prices equal high value.
- This contrasts with earlier economic theories that tied value to objective production and labor.
Goldman Sachs' Productivity
- After the 2008 financial crisis, Goldman Sachs CEO Lloyd Blankfein claimed his workers were the most productive.
- This statement, while shocking, is consistent with a price-based value system where high earners are deemed most productive.
The Illusion of Objective Pricing
- Market-set prices are perceived as objective, but they don't reflect true value.
- Prices often reflect availability, not the actual value individuals place on goods and services.
