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ClintonomicsThe
work of Nations. By Robert Reich Endogenous
development, immaterial
labour R.
Reich (Secretary of Labour in Clinton’s administration), Ronald Coase (Noble
Prize), Paul Romer (professor of economics at Berkeley University) |
Clintonomics is the name ascribed
to a set of policies implemented during Clinton’s presidency in the US. It
is important for us because its main theory (expounded in The work of Nations)
recognises the need to reconstruct the economy following a 12 year period
of neoliberal policies. Robert Reich recognises the centrality of immaterial
labour for the reconstruction of a political and social class that seemed
to have fallen out of control in voting Perrot. Immaterial labour is defined
by Reich as the activity of the ‘manipulation of symbols’. This he recognises
as central for a state intervention that with Clinton takes the form of an
economic and political engineering aimed at circumscribing the conflictual
situation the US found itself in.
Clintonomics poses industrial politics back on the agenda and recognises the inefficacy of deregulation for economic growth. Reich’s theory puts forward the idea of ‘externailities’. It starts from the assumption that interactions amongst economic agents do not necessarily have to go through the market. Externalities (elements external to the market) can be of a positive or a negative kind. Positive externalities are things such as professional training and ‘education’. Negative ones are for instance the effects on the environment. These externalities represent added costs or benefits that are not included in market transactions and are ‘regulated’ by the collectivity. It is here, in the regulation of externalities, that the State can find legitimation for its active intervention. Once the inefficacy of deregulation is recognised in economic terms, state intervention can be justified on the basis that the spontaneous equilibrium of the sum of individual initiatives is insufficient for an optimal collective equilibrium.
Paul Romer focuses on the gap
between rich and poor and its consequence for economic growth. At the beginning
of the 90’s the US experienced a major slow down of economic growth. Romer
identifies ‘inequality’ of distribution of wages and education as its cause
rather than effect. The State needs to intervene in order to regulate the level
of productivity of its population.
The idea of endogenous
development hence summarises the clintonomics effort at a synergy of individual
investment and a collective productivity managed by the State.
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Rating |
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Read essay |
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Anatomy of
Clintonomics. By Robert Pollin published on the New Left Review |
interesting |
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Resources |
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Investing in People
"Good for Us as a Nation", by Robert Reich |
If
you can stomach the jargon, this is an interview on businness and education |
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Bibliography |
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