The Entrepreneurial State: Debunking Public vs Private Sector Myths By Mariana Mazzucato Anthem Press (2013) Book Review This book totally shatters the lie that the free market makes the US the world’s greatest economic power. Mazzucato leaves the reader with absolutely no doubt the exact opposite is true
As Mazzucato’s research ably demonstrates, capitalism doesn’t work without massive state investment in research and development because no private investor (ie neither banks nor venture capitalists) will risk investing in new technologies that require 15-20 years to produce returns.
Without massive state intervention, there is no economic growth – anywhere. This is why austerity budgets adopted by most of the industrialized world have been so damaging. According to Mazzucato, austerity itself is directly responsible for current global stagnation (with a decade of near zero growth). Moreover industrialized countries with the lowest level of state-subsidized research and development (Greece, Italy, Spain, Portugal) are the ones struggling the most economically.