Imatge de l'autor
12 obres 979 Membres 8 Ressenyes

Sobre l'autor

Obres de Mancur Olson

Etiquetat

Coneixement comú

Membres

Ressenyes

TL;DR: parasitic coalitions - unions, subsidized industries, licensed professions, etc - multiply, causing distributive conflicts and allocative inefficiency, and those coalitions can’t be destroyed unless there is radical institutional change, like foreign occupation or totalitarianism.

There are lots of political, social, and cultural implications. But we can't do much about any of that, so instead I wrote about the financial implications - what does Olson's argument mean for our savings and investiments? It's here: http://thiagomarzagao.com/2021/02/11/olson/… (més)
 
Marcat
marzagao | Hi ha 2 ressenyes més | Jun 1, 2021 |
It's pretty rare that you find a book, particularly in a well-trodden field like economics, that manages to feel both original and important. Its main thesis is simplicity itself - that societies over time accumulate interest groups like ships' hulls accumulate barnacles, and over time these groups become more interested in rerouting the benefits of progress to themselves than investing in the future. Think labor unions, manufacturer's groups, advocacy organizations, even charities. He builds on his earlier work, The Logic of Collective Action, in identifying why special interests form, some barriers to their formation and success, and how they persist and operate once formed.

It seems both inarguable and almost obvious, in the way of the best economic logic, but in much the same way that an idea as seemingly non-controversial today as division of labor had to be explained over hundreds of pages way back in the day by Adam Smith, so Olson has to spend his time laying out all the background detail on how groups decide to grab their slice of the economic pie rather than investing in bakeries and making more pies, instead of just condensing his arguments to bullet points and getting on with it. One of the things that endeared this book to me is that it neatly complements the existing schools of economic thought - you can still be a die-hard Friedmanite or Keynesian while still accepting his regressions on the effects of interest groups on growth rates. Additionally, he doesn't take an ideological stance on whether these groups are good or bad; special interests are simply advocating for whatever is special to them, and rare is the reader who won't agree that at least some special interest groups are doing some good overall.

The ultimate implications of his book as I understand them are not so good for the US: once a society becomes encrusted to a point with groups dedicated to redirecting output towards their members (e.g. Social Security and Medicare for the AARP, farm and energy subsidies for the folks in flyover states, the military-industrial complex in its entirety), it becomes almost impossible to dislodge them without some kind of shock to the political system equivalent to a revolution or a defeat in a war (the temporary lack of interest groups is his major explanation for the rapid growth of the seemingly ruined Axis nations after World War 2). So after political shocks, countries can experience years or decades of "catch-up" growth until coalitions start forming to argue for special treatment, and ironically fast-growing societies can sow the seeds of their own stagnation by betting that it's cheaper to buy off these coalitions rather than fight them, until lo and behold they grind to a halt. The United States has been blessed with an unusually stable political system relative to most other advanced nations, and stability is the perfect breeding ground for parasites, so even the recent recession, as traumatic as it is for average people, has made little impact on Capitol Hill where the real action and lobbying and horse-trading have continued practically uninterrupted.

This all has real consequences: if you look at a graph of American GDP growth by decade, each one is inevitably less than the one before, with the sole exception of the 90s as the Baby Boomers entered their working prime. Lacking that irreproducible demographic bonus, and barring future technological miracles (the "New Economy" of internet companies doesn't look like it's going too well), America can look forward to ever-slower growth in spite of all its other advantages like plentiful immigration and its world-class universities, simply because there are so many interest groups trying to grab goodies for themselves. This is of course on top of other challenges like climate change, the steady evaporation of the middle class, and transnationalized businesses that don't really care about the average chump who can't afford their stuff anyway, and so it's kind of tough to see where we can go from here.

However, I'm not really sure his ending arguments about the way that flexible prices operate in an era of stagflation - supposedly the climax of the book and the strongest formulation of his alternative to Keynes - is very accurate, at least with respect to the Great Recession: unemployment has doubled across the board in every industry, in every state, for every educational level, which is something that's tough to explain as the result of distributional coalitions and constrained movement between the "flexprice" versus "fixprice" sectors. Also, a lot of his regression tests seem to have broken down completely in the intervening years (this book was published in 1982), like the relationship between state-level unionization and unemployment, which obviously considerably weakens his theory.

I still think Keynes has the best foundational framework for thinking through the mechanics of recessions. Still, it's an interesting book, even inarguably "true" in parts, and so I think it's a valuable addition to everyone's mental economics toolbox, especially the parts emphasizing how historically dependent a lot of economic theories are. Unfortunately his is too, but that's pretty much unavoidable. Economics is often nothing more than philosophy with a veneer of psychology, rather than the physics with a veneer of politics it pretends to be.
… (més)
 
Marcat
aaronarnold | Hi ha 2 ressenyes més | May 11, 2021 |
If there is a leading economic text to act as a guide to the new milenium it is probably this one.

Olson firmly rejects the idea that economics can be understood without the political context of power relationships that surround commercial activity.

He makes the interesting observation that lively markets exist throughout the Third World and he refers to these as "self-regulating" markets with a notable characteristic being their short time horizon. Essentially there is the simultaneous payment for and delivery of goods.

He contrasts this with advanced democracies that have "NON self-regulating" markets i.e. what he calls "socially contrived markets" that allow much greater predictability and longer time horizons based on contract law and state protected property rights, allowing such things as long-term capital investment, stock markets, complex manufacturing and banking.

An established democracy with widely spread power and solid property rights is clearly desirable but he makes the point that democracy is a historically recent invention that has only partly displaced traditional autocracies. Autocracies (dictatorships) concentrate power in one person or a small group at the expense of the majority and are maintained by the threat of force and often use an "ideology", for example Communism of Fascism, to justify their exclusive and permanent right to power.

The book shows that democratic free markets with an impartial rule of law will in the long rule out distance unstable dictatorships, but he proceeds to suggest that long-established democracies are prone to a few problems of their own, that in some cases can prove fatal. Most notably special interest groups can gain (undemocratic) special access to political power for their own gain at the expense of the national majority. A fine example would be the enormously costly bailout of the speculative bad debts of Wall Street banks passed onto American taxpayers, or alternatively (again in the U.S.), the medical/ insurance lobby that manages to deliver a less health population at twice the cost of similar European systems.

An interesting observation is that the remarkable success of German and Japan after WW2 was in large part the result of the complete destruction intricate systems of special relationships allowing a fresh start along clean free market lines, but of course, at the great social cost of war.
… (més)
 
Marcat
Miro | Feb 12, 2012 |
There are some theories in this book, like that to avoid the free rider problem large pressure groups either needs coercion, or an added incentive, like insurance, for members to join and pay their dues. But filling up most of the pages are adulatory references to almost every member of the University Professors' Union who ever wrote anything about groups - which indicates membership cohesion implemented without either? A summary of the content useful outside academia would be short.
 
Marcat
jahn | Hi ha 3 ressenyes més | Jun 23, 2009 |

Llistes

Premis

Potser també t'agrada

Estadístiques

Obres
12
Membres
979
Popularitat
#26,316
Valoració
4.1
Ressenyes
8
ISBN
46
Llengües
7

Gràfics i taules