» Good Capitalism, Bad Capitalism, and the Economics of Growth and Prosperity

Good Capitalism, Bad Capitalism, and the Economics of Growth and Prosperity Reviews

Customer Rating:
Summary: James Young's Review of Baumol et al's Good Capitalism, Bad Capitalism
Comment: Watch Video Here: http://www.amazon.com/review/R1WSOR2ZBB5133 James Young's review was made as part of a critical review assignment for the Fall 2008 Economics of Entrepreneurship seminar at the University of Nebraska at Omaha, taught by Art Diamond. (The course syllabus stated that part of the critical review assignment consisted of the making of a video recording of the review, and the posting of the review to Amazon.)

---

Customer Rating:
Summary: Baumol on Capitalism
Comment: This book is a description of the different ways in which advanced and emerging economies include the concepts of capitalism in their policies. There is really nothing new in it, but it is a convenient guide to economic policies in the selected countries. Lacking is a description of Classical capitalism, which would permit the reader to assess the aberrations adopted by each country.

---

Customer Rating:
Summary: Better View of Capitalism
Comment: Good Capitalism Bad Capitalism is an excellent book which provided the beginner economic student with an open and informative view of capitalism.
The body of the book presented the reader with a view of capitalism, which enabled one to better understand what is needed to succeed in the American economy today.
I would highly recommned this book to anyone interested in learning more about capitalism and economics.

---

Customer Rating:
Summary: Good, Not Bad
Comment: This book makes a persuasive argument why "entrepreneurial" capitalism yields faster growth than "big-company" capitalism. For the true believers, it doesn't contribute much to the debate, but if you haven't read a textbook on the economics of growth, it provides a concise summary of the many factors affecting growth.

The core of the book argues that Europe and Japan focused on big-company capitalism after WWII as a logical way to rebuild their war-torn economies and as a result, this form of capital still dominates these economies. It also postulates that cultures can likely be changed over the medium term (ten-ish years, perhaps). This leaves unaddressed the question why then haven't European and Japanese cultures evolved into faster growing "entrepreneurial" capitalism as the US appears to have over the last 15 years. (Prior to that, all three economies were growing at similar growth rates; if anything the US was growing slightly slower as the other economies caught up.)

I suspect the reasons are threefold. First, IT opened up a target rich investment environment. Second, both Europe and Japan face high costs to redeploy workers from old sectors of the economy to new growing sectors. The opportunity cost of leaving resources employed suboptimally (and the productive thinkers who guide them) significantly holds back these economies. Third, more equal income distribution substantially reduces risk taking as the propensity to save and invest grows significantly with income. The first dollars of savings are used primarily for housing (really a consumer good), then safe (big-company) financial investments (to stockpile for retirement) and lastly to underwrite entrepreneurial risk. As a result, the real cost of redistribution is its toll on risk-taking. By and large, only the very rich can afford to underwrite/finance the latter. These factors are given short shift by the book.

In fact, the book argues for more equal distribution while ignoring the very different but critically important causes of unequal distribution - economically misguided oligarchs who misappropriate it vs. successful entrepreneurs who rightly earn it. The book devotes all of 2 pages to taxation.

(My guess is that there are also positive feedback loops at work culturally where success causes others to desire success which in turn leads to a culture that embraces (business) success rather than shunning/criticizing it. And where critical masses of creative cutting-edge thinkers yield real synergies.)

In my opinion then, the book comes up short. It identifies the fact that entrepreneurial capitalism is desirable; but its prescriptions for how to achieve and sustain it are not very profound. Only a comparison to Europe and Japan that reveals why these cultures haven't evolved toward higher growth, like the US, can reveal the truth. Most of the prescriptions, such as protecting intellectual property, enforcing anti-trust laws, reigning in unmeritorious litigation, etc. are largely identical between the 3 societies and hardly "ground breaking."

---

Customer Rating:
Summary: The Beginners Economic Guide
Comment: Good Capitalism, Bad Capitalism offers a very informative and easy to read approach to economics. I have a much broader understanding of economics after reading this book. It was interesting and the authors' are incredibly thorough at describing the various aspects of economics. As a person who had a very minimal understanding of the economic world this book provided the basics. I can now appreciate the issues that are faced in the economic arena. I am able to state my opinion relating to economic issues with confidence now. This book offers a nice transition into the world of economics. It is painless and interesting. I highly recommend it to anyone who needs to learn the basics.

---

More Reviews for Good Capitalism, Bad Capitalism, and the Economics of Growth and Prosperity