Peddling Prosperity
Encyclopedia
Peddling prosperity: economic sense and nonsense in the age of diminished expectation is a book by Nobel laureate and New York Times columnist Paul Krugman
, first published in 1994 by W. W. Norton & Company. Shortly after its publication Newsweek
called it "the best primer around on recent U.S. economic history." In the book Krugman covers the US productivity slowdown that has occurred since the 1970s, changes in the ideology among economists, and offers critiques of both conservative supply side economics and liberal support for government intervention in the form of "strategic policy". Krugman argues the rise of the Austrian School
and its sister school of supply-side economics
is produced by the inability of opposing economists to convincingly explain certain economic phenomenon, such as the US productivity slowdown. He criticizes monetarism
, rational expectations theory, and conservative economists' views on taxes and regulation, arguing for greater government intervention into the market-economy via increased deficit-spending and higher taxes.
One of the major themes of the book is that the difference between real economic
theory and "policy entrepreneurs", who peddle politically popular but academically wrong ideas, is as important as the polarization between the political left and right in America. Krugman describes these "policy entrepreneurs" as non-academics who promote particular intellectual positions and ideological policy prescriptions in areas where a problem is perceived to exist. The success of these so-called "policy entrepreneurs", according to Krugman's is at least partly due to the unwillingness and inability of competing economists to effectively communicate their opposing ideas in a rationally received manner; a shortcoming which Krugman's book is meant to address.
A portion of the subtitle of the book refers to an earlier book by Krugman, Age of Diminished Expectations (1990).
Paul Krugman
Paul Robin Krugman is an American economist, professor of Economics and International Affairs at the Woodrow Wilson School of Public and International Affairs at Princeton University, Centenary Professor at the London School of Economics, and an op-ed columnist for The New York Times...
, first published in 1994 by W. W. Norton & Company. Shortly after its publication Newsweek
Newsweek
Newsweek is an American weekly news magazine published in New York City. It is distributed throughout the United States and internationally. It is the second-largest news weekly magazine in the U.S., having trailed Time in circulation and advertising revenue for most of its existence...
called it "the best primer around on recent U.S. economic history." In the book Krugman covers the US productivity slowdown that has occurred since the 1970s, changes in the ideology among economists, and offers critiques of both conservative supply side economics and liberal support for government intervention in the form of "strategic policy". Krugman argues the rise of the Austrian School
Austrian School
The Austrian School of economics is a heterodox school of economic thought. It advocates methodological individualism in interpreting economic developments , the theory that money is non-neutral, the theory that the capital structure of economies consists of heterogeneous goods that have...
and its sister school of supply-side economics
Supply-side economics
Supply-side economics is a school of macroeconomic thought that argues that economic growth can be most effectively created by lowering barriers for people to produce goods and services, such as lowering income tax and capital gains tax rates, and by allowing greater flexibility by reducing...
is produced by the inability of opposing economists to convincingly explain certain economic phenomenon, such as the US productivity slowdown. He criticizes monetarism
Monetarism
Monetarism is a tendency in economic thought that emphasizes the role of governments in controlling the amount of money in circulation. It is the view within monetary economics that variation in the money supply has major influences on national output in the short run and the price level over...
, rational expectations theory, and conservative economists' views on taxes and regulation, arguing for greater government intervention into the market-economy via increased deficit-spending and higher taxes.
One of the major themes of the book is that the difference between real economic
Economics
Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...
theory and "policy entrepreneurs", who peddle politically popular but academically wrong ideas, is as important as the polarization between the political left and right in America. Krugman describes these "policy entrepreneurs" as non-academics who promote particular intellectual positions and ideological policy prescriptions in areas where a problem is perceived to exist. The success of these so-called "policy entrepreneurs", according to Krugman's is at least partly due to the unwillingness and inability of competing economists to effectively communicate their opposing ideas in a rationally received manner; a shortcoming which Krugman's book is meant to address.
A portion of the subtitle of the book refers to an earlier book by Krugman, Age of Diminished Expectations (1990).