No. of Recommendations: 14
Starting in college I have pushed back against modern economic theories as wildly simplistic and insufficiently grounded in social and political realities.

Here is a link to an excellent summary of much of post-Keynes-Hayek Political Economic theorizing and application, given as a well written review of two books on the subject.

A key point --> the rise of economists from being dull gloomy ivory tower types to becoming titans of politics and governance.

Another --> the various shifts in corporate governance and political power echoing the different schools of empowered economists and the laws regulations and social expectations they fostered.

Here is a key passage:

Jensen agreed with Berle’s starting point: Corporate managers were unaccountable because shareholders could not restrain them. But rather than seeing a remedy in checks exerted by regulators and organized labor, Jensen proposed to overhaul the firm so that ownership and control were reunited. Executives should be rewarded more with stock and less with salary, so that they would think like shareholders and focus on the profits that shareholders wanted. Managers who failed to generate a good return would see their stock prices languish, which would create tempting takeover targets. A market for corporate control would redouble the pressure on bosses to behave like owners. Successful takeovers, in turn, would shift corporations into the hands of single, all-powerful proprietors, capable of overseeing management more effectively than scattered stockholders could. In sum, Jensen’s prescriptions inverted Berle’s. The market could be made to solve the problem of the firm. Government could pull back from regulation. Shortly after the publication of his research, the invention of junk bonds made hostile takeovers the rage. During the ’80s, more than a quarter of the companies on the Fortune 500 list were targeted. Jensen became the scholar who explained why this unprecedented boardroom bloodbath was good news for America....[then came] the collapse of Enron....Even before the 2008 crash, Jensen disavowed the transactional culture he had helped to legitimize. Holy sh!t, Jensen remembers saying to himself. Anything can be corrupted.

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