Paul Collier, The Future of Capitalism: Facing the New Anxieties

Excerpt

George Akerlof, winner of the 2001 Nobel memorial prize in Economics and a pioneer of what he terms ‘identity economics’ (see Akerlof and Kranton 2010), describes the book under review as ‘the most revolutionary work of social science since Keynes.’ The importance of Keynes’s magnum opus, published in 1936, was that it provided a diagnosis of why the Great Depression—the overriding problem facing the world in the early 1930s. Keynes drew on arguments about the social psychology of markets, but his General Theory of Employment, Interest and Money (1936) was fundamentally a work of economic theory. Though aimed at his fellow economists, it provided one of the pillars of the social philosophy that dominated the first three decades after the Second World War, often called ‘the age of Keynes.’ …