Cliodynamics

Does Capitalism Have a Future? is the work of five distinguished senior authors addressing the future of capitalism and its recent past. Their book warns that “something big looms on the horizon: a structural crisis much bigger than the recent great recession. Over the next three or four decades, capitalists of the world may simply find it impossible to make their usual investment decisions due to overcrowding of world markets and inadequate accounting for rising social costs. In this situation, capitalism would end in the frustration of the capitalists themselves.”

The authors have chosen a very broad and important topic that suggests the need for skillful conceptualization, patient historical research, and well-informed, multidisciplinary analysis, all of which inevitably makes for a difficult read. At the same time, I fear that the book’s “bad news” for society might incline some readers to want to “shoot the messengers.” Nevertheless, in my view, these authors deserve credit for having the courage to report the “bad news” they foresee for the future of capitalism and for making some very far-sighted observations about their topic—most significantly, that capitalism is a system of political economy and not just the economics of markets. I agree wholeheartedly. In addition, I applaud their assertion that capitalist systems frequently have significant unrecognized costs (externalities) and that the employment prospects for its middle classes are being challenged as never before.