The sudden drop in America's productivity rate beginning in the early 1970s and the simultaneous increase in income inequality made a generation of American economists pessimistic about the nation's ability to grow faster or to deal with the growing gap between the rich and everyone else. Barry Bluestone and Bennett Harrison review the historical record and offer an elegant explanation of why the productivity drought occurred and why it is finally over. The potential for a sustained era of economic expansion more equitably shared is on the horizon, thanks to the revolution in computer and information technology that has now come of age.But potential, the authors argue, is one thing; realization is another. Though optimistic about the productivity boom, Bluestone and Harrison do not believe that the payoff to the technology revolution can be fully realized without a sea change in economic policy. Their discerning analysis reveals that the current obsession with federal debt reduction and inflation control -- the very essence of what they call the "Wall Street model" -- will in fact sabotage growth. Only by embracing a "Main Street model" that revitalizes government-sponsored R&D, public infrastructure, education, and training -- all of which have helped underwrite spectacular economic growth spurts in the past -- can America reach its potential for equitable expansion in the coming century. Flying in the face of the ruling economic orthodoxy, GROWING PROSPERITY is a beautifully argued work that goes beyond critique to envision a way to add $3.2 trillion to the economy over the coming decade. With its provocative thesis and its clear prescriptive message, it will be of great interest to everyone with a stake in our economic future.
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Book Description
Editorial Reviews
From Publishers Weekly
To many observers, the strong performance of the U.S. economy in recent years may seem mysterious. Most mainstream economists credit the Wall Street-Pennsylvania Avenue Accord, "based on balanced federal budgets, free trade, flexible labor markets, and a firm monetary policy," for our economic success. While acknowledging the benefits of these factors, Bluestone, a professor of political economy at Northeastern University, and Harrison, who until his death last January was a professor at Harvard's Kennedy School of Government (coauthors of The Deindustrialization of America, etc.), find the source of our growth elsewhere, in increased productivity. They begin by examining a perplexing period in American economic life, between 1973 and 1995, in which productivity growth was a mere 1.2%. The conundrum is how to explain the rise in productivity growth to 2.0% since 1996. Bluestone and Harrison claim that the increase and resulting gains in GDP have occurred as a result of improvements in information technology. As in their previous writings, the authors challenge conventional thinking. Unrepentant Keynesians, Bluestone and Harrison argue persuasively for replacing the Wall Street model with pro-Main Street policies, contending that renewed government investment in research and development and infrastructure, the promotion of liberalized trade with environmental and worker protections, rising wages and greater employment security can advance social justice and economic growth simultaneously.
Copyright 1999 Reed Business Information, Inc.
Copyright 1999 Reed Business Information, Inc.
From Library Journal
Bluestone (political economy, Northeastern Univ.) and the late Harrison (Kennedy Sch. of Government, Harvard) have produced a scholarly, well-written, and very readable book on current economic policy and issues. After tracing the history of the U.S. economy since the end of World War II, the authors examine the current state of the economy. They note the role of technology and its effect on productivity and current economic policy and agree that low inflation and a budget surplus contribute to our present prosperity. But they emphasize that to help ensure continued growth, government spending in areas such as infrastructure, research and development, and education must take priority. Government policies regarding labor and wages must also be changed to gurarantee that the population can afford to take advantage of all that technology has to offer. The authors' perspective offers students, professionals, and others interested in political science, economics, and business a much-needed reassessment of our current and future prospects. A good choice for large public and academic libraries.
-Steven J. Mayover, Free Lib. of Philadelphia
Copyright 2000 Reed Business Information, Inc.
-Steven J. Mayover, Free Lib. of Philadelphia
Copyright 2000 Reed Business Information, Inc.
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Most Helpful Customer Reviews
8 of 8 people found the following review helpful:
4.0 out of 5 stars
Throwing light on technological long waves.,
By larens imanyuel (Berkeley, California) - See all my reviews
This review is from: Growing Prosperity (Hardcover)
Using historical data on the rate of increase of productivity, these authors build a convincing case that the United States is near the beginning of an economic boom based on information technlogy. They go well beyond most economists in explaining the nature of economic long waves (also called Kondratieff waves). They then explain in depth how current government economic policies are misdirected in terms of maximizing this pattern of economic growth.
3 of 3 people found the following review helpful:
3.0 out of 5 stars
A New Model for Economic Growth,
This review is from: Growing Prosperity: The Battle for Growth with Equity in the Twenty-first Century (Paperback)
We've all heard about the great economic miracle of the past twenty years. What we haven't heard, though, is that the rate of growth has significantly slowed from pre-1973 levels. This book explains why, and shows that we may be able to achieve high growth rates again. The authors criticize the "Wall Street Model" of growth, which stresses low inflation and enhanced savings. This model, they say, leads to increased inequality and slower growth. The authors present an alternative "Main Street Model" which instead stresses technological innovation as the main driver of growth. The keys to increasing technological innovation are public investments in R&D and infrastructure, as well as increasing demand through higher minimum wages and a stronger role for unions. This book coherently presents this new model of growth and explains why the Wall Street model is flawed. This book has an unashamedly left-wing bias and some people may be put off by the more opinionated parts of this book. I found myself wishing the authors would stick to facts instead of shoving ideas in your face that can't be backed up. In one part of the book the authors discuss the "neoclassical growth syllogism" and try to show how flawed it is. To do this, they examine each premise of the syllogism and assign a seemingly arbitrary percentage describing how true the premise is. You just can't do that. If you give me a number, you better be able to support it with facts or else you're wasting my time. These authors are probably well educated and they should know better than to whimsically pull numbers out of their [fundaments.]
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