The value of everything by Mariana Mazzucato is about value creation and value extraction, making versus taking, which is a subtitle of the book. We currently have corporate governance structures which are very much not just aimed at short-termism but actually very much centred around extracting value. The book talks about particular practices of value extraction, for example, the increasing practice of just buying back your own shares to boost your share price or options and, unsurprisingly, executive pay.
The book also opens polemics with narratives and lazy assumptions that are used all the time that wealth is created in business and then, at best, what government can do is facilitate it and redistribute that value through taxation. Mariana, on the other hand, argues that the value creation process is a collective creation and of course labour creates value, different types of state entities create value, businesses create value, and of course, civil society creates value. We would not have weekends and we would not have an eight-hour workday without trade unions. In this concept of different actors comes together to co-create value and, undoubtedly, have conflict in the process. This should be at the heart of any progressive agenda. She also argues that the financial sector and the Silicon Valley seen as great wealth creators are often just shuffling around existing value, or even worse, destroying it.
Anyway, the book provides a good storyline of where does value come from in different ages and gives a great analysis of how these concepts interlink. Mariana explains a change in the understanding of the value and how it affects the way we see things. In the 1600s we had Mercantilists who created value by trade, focusing on the terms of trade, on exchange rates and taxation. They thought it was trade itself that created value and that’s why they put so much emphasis on that. Then in 1700s Physiocrats opted for farming. It was still before the industrial revolution in an agricultural society so at the heart of their theory of value was, in fact, farm labour. In the next century Classicals like Adam Smith and Karl Marks were starting to put emphasis on value as embodied in the industrial environment in the working process. They tried to understand... (if you like to read my full review please visit my blog https://leadersarereaders.blog/the-value-of-everything-making-and-taking-in-the-global-economy/)...Continua