This article has been reviewed according to Science X's editorial process and policies. Editors have highlighted the following attributes while ensuring the content's credibility: Governments need to work hand in hand with the private sector, rather than leaving business to its own devices. They should be "moving away from fixing market failures and government failures toward actively shaping how markets are governed." International economist and government adviser Mariana Mazzucato argues this in her new book, "The Common Good Economy." Mazzucato is known for arguing that, all too often, the public sector socializes risks while privatizing rewards.
Innovative products from private companies such as Apple are often co-created with the state. State institutions may do the basic research, train the skilled workers, provide the infrastructure and clean up the pollution generated. But when this pays off, the resulting profits go to the company's shareholders.
She believes more of the profits generated should be shared with the public. This can be done through a combination of taxes on corporate profits, income, capital gains and wealth. Or it can involve equity stakes, where the government takes a partial ownership stake in the enterprise.
Examples in this book range from Norway's sovereign wealth fund to the London borough of Camden's Community Wealth Fund, which invests in businesses to create jobs. She also reiterates her idea of governments setting out clear "missions." These involve collaboration between private and public organizations to address major challenges. And she remains critical of outsourcing policy development to consulting firms.
This has eroded the capacity of the public service. "The Common Good" consolidates her earlier books and articles. (Over 50 are listed in the comprehensive bibliography.) Outside academia, the "common good" and "public good" are not terms we often hear these days. Partly this is a reflection of the more individualistic and less collective political discourse.
But there is also a problem: The terms are a little ambiguous. The "common good" or "public good" can be taken to mean the interests of the broader community. But the terms are also used by economists to refer to goods (and services) usually provided by governments.
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