Volume 56, Number 5 March 26, 2009 Capitalism Beyond the Crisis By Amartya en !

!" 2008 was a year of crises. First, we had a food crisis, particularly threatening to poor consumers, especially in Africa. Along with that came a record increase in oil prices, threatening all oil-importing countries. Finally, rather suddenly in the fall, came the global economic downturn, and it is now gathering speed at a frightening rate. The year 2009 seems li ely to offer a sharp intensification of the downturn, and many economists are anticipating a full-scale depression, perhaps e!en one as large as in the "9#0s. $hile substantial fortunes ha!e suffered steep declines, the people most affected are those who were already worst off. The %uestion that arises most forcefully now concerns the nature of capitalism and whether it needs to be changed. &ome defenders of unfettered capitalism who resist change are con!inced that capitalism is being blamed too much for short-term economic problems'problems they !ariously attribute to bad go!ernance (for e)ample by the *ush administration+ and the bad beha!ior of some indi!iduals (or what ,ohn -c.ain described during the presidential campaign as /the greed of $all &treet/+. 0thers do, howe!er, see truly serious defects in the e)isting economic arrangements and want to reform them, loo ing for an alternati!e approach that is increasingly being called /new capitalism./ The idea of old and new capitalism played an energi1ing part at a symposium called /2ew $orld, 2ew .apitalism/ held in 3aris in ,anuary and hosted by the French president 2icolas &ar o1y and the former *ritish prime minister Tony *lair, both of whom made elo%uent presentations on the need for change. &o did 4erman .hancellor Angela -er el, who tal ed about the old 4erman idea of a /social mar et/'one restrained by a mi)ture of consensus-building policies'as a possible blueprint for new capitalism (though 4ermany has not done much better in the recent crisis than other mar et economies+.

#deas about chan$in$ the or$ani%ation o& society in the lon$ run are clearly needed, 'uite apart &rom strate$ies &or dealin$ (ith an immediate crisis" 5 would separate out three %uestions from the many that can be raised. )irst, do (e really need some *ind o& +ne( capitalism+ rather than an economic system that is not monolithic, dra(s on a ,ariety o& institutions chosen pra$matically, and is based on social ,alues that (e can de&end ethically- &hould we search for a new capitalism or for a /new world/'to use the other term mentioned at the 3aris meeting'that would ta e a different form6 The second %uestion concerns the ind of economics that is needed today, especially in light of the present economic crisis. 7ow do we assess what is taught and championed among academic economists as a guide to economic policy'includin$ the re,i,al o& .eynesian thou$ht in recent months as the crisis has $ro(n &ierce- -ore particularly, what does the present economic crisis tell us about the institutions and priorities to loo for6 Third, in addition to wor ing our way toward a better assessment of (hat lon$/ term chan$es are needed, (e ha,e to thin*0and thin* &ast0about ho( to $et out o& the present crisis (ith as little dama$e as possible" 2" 1hat are the special characteristics that ma*e a system indubitably capitalist0old or ne(5f the present capitalist economic system is to be reformed, what would ma e the end result a new capitalism, rather than something else6 5t seems to be generally assumed that relying on mar ets for economic transactions is a necessary condition for an economy to be identified as capitalist. #n a similar (ay, dependence on the pro&it moti,e and on indi,idual re(ards based on pri,ate o(nership are seen as archetypal &eatures o& capitalism. 7owe!er, if these are necessary re%uirements, are the economic systems (e currently ha,e, &or e2ample, in 3urope and America, $enuinely capitalistAll affluent countries in the world'those in 8urope, as well as the 9&, .anada, ,apan, &ingapore, &outh :orea, Australia, and others'ha!e, for %uite some time now, depended partly on transactions and other payments that occur largely outside mar ets. 4hese include unemployment bene&its, public pensions, other &eatures o& social security, and the pro,ision o&

education, health care, and a ,ariety o& other ser,ices distributed throu$h nonmar*et arran$ements" 4he economic entitlements connected (ith such ser,ices are not based on pri,ate o(nership and property ri$hts" Also, the mar*et economy has depended &or its o(n (or*in$ not only on ma2imi%in$ pro&its but also on many other acti,ities, such as maintainin$ public security and supplyin$ public ser,ices0some o& (hich ha,e ta*en people (ell beyond an economy dri,en only by pro&it. 4he creditable per&ormance o& the so/called capitalist system, (hen thin$s mo,ed &or(ard, dre( on a combination o& institutions0publicly &unded education, medical care, and mass transportation are 5ust a &e( o& many0that (ent much beyond relyin$ only on a pro&it/ma2imi%in$ mar*et economy and on personal entitlements con&ined to pri,ate o(nership" 9nderlying this issue is a more basic %uestion; whether capitalism is a term that is of particular use today. The idea of capitalism did in fact ha!e an important role historically, but by now that usefulness may well be fairly e)hausted. For e)ample, the pioneering wor s of Adam mith in the eighteenth century showed the usefulness and dynamism of the mar et economy, and why'and particularly how'that dynamism wor ed. &mith<s in!estigation pro!ided an illuminating diagnosis of the wor ings of the mar et =ust when that dynamism was powerfully emerging. The contribution that The Wealth of Nations, published in !666, made to the understanding of what came to be called capitalism was monumental. mith sho(ed ho( the &reein$ o& trade can ,ery o&ten be e2tremely help&ul in $eneratin$ economic prosperity throu$h speciali%ation in production and di,ision o& labor and in ma*in$ $ood use o& economies o& lar$e scale" Those lessons remain deeply rele!ant e!en today (it is interesting that the impressi!e and highly sophisticated analytical wor on international trade for which 3aul :rugman recei!ed the latest 2obel award in economics was closely lin ed to &mith<s far-reaching insights of more than 2#0 years ago+. The economic analyses that followed those early e)positions of mar ets and the use of capital in the eighteenth century ha!e succeeded in solidly establishing the mar et system in the corpus of mainstream economics.

7owe!er, e!en as the positi!e contributions of capitalism through mar*et processes were being clarified and e)plicated, its ne$ati,e sides (ere also becomin$ clear0o&ten to the ,ery same analysts" $hile a number of socialist critics, most notably .arl Mar2, influentially made a case for censuring and ultimately supplanting capitalism, the huge limitations of relying entirely on the mar et economy and the profit moti!e were also clear enough e!en to Adam &mith. #ndeed, early ad,ocates o& the use o& mar*ets, includin$ mith, did not ta*e the pure mar*et mechanism to be a &reestandin$ per&ormer o& e2cellence, nor did they ta*e the pro&it moti,e to be all that is needed" 8!en though people see trade because of sel&/interest (nothing more than self-interest is needed, as &mith famously put it, in e2plainin$ (hy ba*ers, bre(ers, butchers, and consumers see* trade7, ne!ertheless an economy can operate e&&ecti,ely only on the basis o& trust amon$ di&&erent parties. $hen business acti!ities, including those of ban s and other financial institutions, $enerate the con&idence that they can and will do the things they pledge, then relations among lenders and borrowers can go smoothly in a mutually supporti!e way. As Adam mith wrote; 1hen the people o& any particular country ha,e such con&idence in the &ortune, probity, and prudence o& a particular ban*er, as to belie,e that he is al(ays ready to pay upon demand such o& his promissory notes as are li*ely to be at any time presented to him8 those notes come to ha,e the same currency as $old and sil,er money, &rom the con&idence that such money can at any time be had &or them.>"? &mith e)plained why sometimes this did not happen, and he would not ha!e found anything particularly pu11ling, 5 would suggest, in the di&&iculties &aced today by businesses and ban*s than*s to the (idespread &ear and mistrust that is *eepin$ credit mar*ets &ro%en and pre,entin$ a coordinated e2pansion o& credit" 5t is also worth mentioning in this conte)t, especially since the /welfare state/ emerged long after &mith<s own time, that in his !arious writings, his o,er(helmin$ concern0and (orry0about the &ate o& the poor and the disad,anta$ed are stri*in$ly prominent" The most immediate failure of the mar et mechanism lies in the things that the mar et lea!es undone. mith9s economic analysis (ent (ell beyond lea,in$ e,erythin$ to the in,isible hand o& the mar*et mechanism. :e (as not only a de&ender o&

the role o& the state in pro,idin$ public ser,ices, such as education, and in po,erty relie& ;alon$ (ith demandin$ $reater &reedom &or the indi$ents (ho recei,ed support than the <oor =a(s o& his day pro,ided7, he (as also deeply concerned about the ine'uality and po,erty that mi$ht sur,i,e in an other(ise success&ul mar*et economy" =ac* o& clarity about the distinction bet(een the necessity and su&&iciency o& the mar*et has been responsible &or some misunderstandin$s o& mith9s assessment o& the mar*et mechanism by many (ho (ould claim to be his &ollo(ers" For e)ample, mith9s de&ense o& the &ood mar*et and his criticism o& restrictions by the state on the pri,ate trade in &ood $rains ha,e o&ten been interpreted as ar$uin$ that any state inter&erence (ould necessarily ma*e hun$er and star,ation (orse" *ut &mith<s defense of pri!ate trade only too the form of disputing the belief that stopping trade in food would reduce the burden of hunger. 4hat does not deny in any (ay the need &or state action to supplement the operations o& the mar*et by creatin$ 5obs and incomes ;e"$", throu$h (or* pro$rams7" 5f unemployment were to increase sharply than s to bad economic circumstances or bad public policy, the mar et would not, on its own, recreate the incomes of those who ha!e lost their =obs. The new unemployed, &mith wrote, /would either star!e, or be dri!en to see a subsistence either by begging, or by the perpetration perhaps of the greatest enormities,/ and +(ant, &amine, and mortality (ould immediately pre,ail..../>2? &mith re=ects inter!entions that exclude the mar et'but not inter!entions that include the mar et while aiming to do those important things that the mar et may lea!e undone. &mith ne!er used the term /capitalism/ (at least so far as 5 ha!e been able to trace+, but it would also be hard to car!e out from his wor s any theory arguing for the sufficiency of mar et forces, or of the need to accept the dominance of capital. :e tal*ed about the importance o& these broader ,alues that $o beyond pro&its in The Wealth of Nations, but it is in his &irst boo*, The Theory of Moral Sentiments, (hich (as published e2actly a 'uarter o& a millennium a$o in !659, that he e2tensi,ely in,esti$ated the stron$ need &or actions based on ,alues that $o (ell beyond pro&it see*in$" $hile he wrote that +prudence+ (as +o& all the ,irtues that (hich is most use&ul to the indi,idual,/ Adam &mith went on to argue that

+humanity, 5ustice, $enerosity, and public spirit, are the 'ualities most use&ul to others./>#? mith ,ie(ed mar*ets and capital as doin$ $ood (or* (ithin their o(n sphere, but &irst, they re'uired support &rom other institutions0 includin$ public ser,ices such as schools0and ,alues other than pure pro&it see*in$, and second, they needed restraint and correction by still other institutions0e"$", (ell/de,ised &inancial re$ulations and state assistance to the poor0&or pre,entin$ instability, ine'uity, and in5ustice" 5f we were to loo for a new approach to the organi1ation of economic acti!ity that included a pragmatic choice of a !ariety of public ser!ices and well-considered regulations, we would be following rather than departing from the agenda of reform that &mith outlined as he both defended and critici1ed capitalism. >" :istorically, capitalism did not emer$e until ne( systems o& la( and economic practice protected property ri$hts and made an economy based on o(nership (or*able" Commercial e2chan$e could not e&&ecti,ely ta*e place until business morality made contractual beha,ior sustainable and ine2pensi,e0not re%uiring constant suing of defaulting contractors, for e)ample. #n,estment in producti,e businesses could not &lourish until the hi$her re(ards &rom corruption had been moderated" <ro&it/oriented capitalism has al(ays dra(n on support &rom other institutional ,alues" The moral and legal obligations and responsibilities associated with transactions ha!e in recent years become much harder to trace, than s to the rapid de!elopment of secondary mar ets in!ol!ing deri!ati!es and other financial instruments. A subprime lender (ho misleads a borro(er into ta*in$ un(ise ris*s can no( pass o&& the &inancial assets to third parties 0(ho are remote &rom the ori$inal transaction" Accountability has been badly undermined, and the need &or super,ision and re$ulation has become much stron$er" And yet the super!isory role of go!ernment in the 9nited &tates in particular has been, o!er the same period, sharply curtailed, &ed by an increasin$ belie& in the sel&/re$ulatory nature o& the mar*et economy . 3recisely as the need for state sur!eillance grew, the needed super!ision shran . There

was, as a result, a disaster waiting to happen, which did e!entually happen last year, and this has certainly contributed a great deal to the financial crisis that is plaguing the world today. 4he insu&&icient re$ulation o& &inancial acti,ities has implications not only &or ille$itimate practices, but also &or a tendency to(ard o,erspeculation that, as Adam mith ar$ued, tends to $rip many human bein$s in their breathless search &or pro&its" mith called the promoters o& e2cessi,e ris* in search o& pro&its +prodi$als and pro5ectors+0which is %uite a $ood description o& issuers o& subprime mort$a$es o!er the past few years. @iscussing laws against usury, for e)ample, &mith wanted state regulation to protect citi1ens from the +prodi$als and pro5ectors+ (ho promoted unsound loans? A $reat part o& the capital o& the country (ould thus be *ept out o& the hands (hich (ere most li*ely to ma*e a pro&itable and ad,anta$eous use o& it, and thro(n into those (hich (ere most li*ely to (aste and destroy it.>A? The implicit faith in the ability of the mar et economy to correct itself, which is largely responsible for the remo!al of established regulations in the 9nited &tates, tended to ignore the acti!ities of prodigals and pro=ectors in a way that would ha!e shoc ed Adam &mith. 4he present economic crisis is partly $enerated by a hu$e o,erestimation o& the (isdom o& mar*et processes, and the crisis is now being e)acerbated by an)iety and lac of trust in the financial mar et and in businesses in general'responses that ha!e been e!ident in the mar et reactions to the se%uence of stimulus plans, including the @6A6 billion plan si$ned into la( in )ebruary by the ne( Bbama administration . As it happens, these problems were already identified in the eighteenth century by &mith, e!en though they ha!e been neglected by those who ha!e been in authority in recent years, especially in the 9nited &tates, and who ha!e been busy citing Adam &mith in support of the unfettered mar et. C" $hile Adam &mith has recently been much %uoted, e!en if not much read, there has been a huge re!i!al, e!en more recently, of Dohn Maynard .eynes" .ertainly, the cumulati!e downturn that we are obser!ing right now, which is edging us closer to a depression, has clear .eynesian &eatures8 the reduced incomes o& one $roup o& persons has led to

reduced purchases by them, in turn causin$ a &urther reduction in the income o& others" 7owe!er, :eynes can be our sa!ior only to a !ery partial e)tent, and there is a need to loo beyond him in understanding the present crisis. 0ne economist whose current rele!ance has been far less recogni1ed is :eynes<s ri!al Arthur Cecil <i$ou, who, li e :eynes, was also in .ambridge, indeed also in :ings .ollege, in :eynes<s time. <i$ou (as much more concerned than .eynes (ith economic psycholo$y and the (ays it could in&luence business cycles and sharpen and harden an economic recession that could ta*e us to(ard a depression ;as indeed (e are seein$ no(7" <i$ou attributed economic &luctuations partly to +psycholo$ical causes+ consistin$ o& ,ariations in the tone o& mind o& persons (hose action controls industry, emer$in$ in errors o& undue optimism or undue pessimism in their business &orecasts.>B? 5t is hard to ignore the fact that today, in addition to the :eynesian effects of mutually reinforced decline, we are strongly in the presence of +errors o&"""undue pessimism"+ <i$ou &ocused particularly on the need to un&ree%e the credit mar*et (hen the economy is in the $rip o& e2cessi,e pessimism? 7ence, other things being e%ual, the actual occurrence of business failures will be more or less widespread, according >to whether? ban ers< loans, in the face of crisis of demands, are less or more readily obtainable.>C? @espite huge in=ections of fresh li%uidity into the American and 8uropean economies, largely from the go!ernment, the ban*s and &inancial institutions ha,e until no( remained un(illin$ to un&ree%e the credit mar*et. 0ther businesses also continue to fail, partly in response to already diminished demand (the :eynesian /multiplier/ process+, but also in response to &ear o& e,en less demand in the &uture, in a climate o& $eneral $loom ;the <i$o,ian process o& in&ectious pessimism7" 0ne of the problems that the 0bama administration has to deal with is that the real crisis, arising from financial mismanagement and other transgressions, has become many times magnified by a psycholo$ical collapse" The measures that are being discussed right now in $ashington and elsewhere to re$enerate the credit mar*et include bailouts0(ith &irm re'uirements that subsidi%ed &inancial institutions actually lend0

$o,ernment purchase o& to2ic assets, insurance a$ainst &ailure to repay loans, and ban* nationali%ation" ;4he last proposal scares many conser,ati,es 5ust as pri,ate control o& the public money $i,en to the ban*s (orries people concerned about accountability"7 As the wea response of the mar et to the administration<s measures so far suggests, each o& these policies (ould ha,e to be assessed partly &or their impact on the psycholo$y o& businesses and consumers, particularly in America" 5" 4he contrast bet(een <i$ou and .eynes is rele,ant &or another reason as (ell. 1hile .eynes (as ,ery in,ol,ed (ith the 'uestion o& ho( to increase a$$re$ate income, he (as relati,ely less en$a$ed in analy%in$ problems o& une'ual distribution o& (ealth and o& social (el&are. 5n contrast, <i$ou not only (rote the classic study o& (el&are economics, but he also pioneered the measurement o& economic ine'uality as a ma5or indicator &or economic assessment and policy.>D? &ince the suffering of the most depri!ed people in each economy'and in the world'demands the most urgent attention, the role of supporti!e cooperation between business and go!ernment cannot stop only with mutually coordinated e)pansion of an economy. There is a critical need for paying special attention to the underdogs of society in planning a response to the current crisis, and in going beyond measures to produce general economic e)pansion. )amilies threatened (ith unemployment, (ith lac* o& medical care, and (ith social as (ell as economic depri,ation ha,e been hit particularly hard" 4he limitations o& .eynesian economics to address their problems demand much $reater reco$nition" A third (ay in (hich .eynes needs to be supplemented concerns his relati,e ne$lect o& social ser,ices'indeed e!en Btto ,on Bismarc* had more to say on this sub5ect than .eynes" That the mar et economy can be particularly bad in deli!ering public goods (such as education and health care+ has been discussed by some of the leading economists of our time, including <aul amuelson and .enneth Arro(. (3igou too contributed to this sub=ect with his emphasis on the /e)ternal effects/ of mar et transactions, where the gains and losses are not confined only to the direct buyers or sellers.+ This is, of course, a long-term issue, but it is worth noting in addition that the bite of a downturn can be much fiercer when health care in particular is not guaranteed for all.

)or e2ample, in the absence o& a national health ser,ice, e,ery lost 5ob can produce a lar$er e2clusion &rom essential health care, because o& loss o& income or loss o& employment/related pri,ate health insurance . The 9& has a D.C percent rate of unemployment now, which is beginning to cause huge depri!ation. 5t is worth as ing how the 8uropean countries, including )rance, #taly, and pain, that li,ed (ith much hi$her le,els o& unemployment &or decades, mana$ed to a,oid a total collapse o& their 'uality o& li&e" The answer is partly the way the 8uropean welfare state operates, with much stronger unemployment insurance than in America and, e!en more importantly, with basic medical ser!ices pro!ided to all by the state. The failure of the mar et mechanism to pro!ide health care for all has been flagrant, most noticeably in the 9nited &tates, but also in the sharp halt in the progress of health and longe!ity in China &ollo(in$ its abolition o& uni,ersal health co,era$e in !969" *efore the economic reforms of that year, e!ery .hinese citi1en had guaranteed health care pro!ided by the state or the cooperati!es, e!en if at a rather basic le!el. $hen .hina remo!ed its counterproducti!e system of agricultural collecti!es and communes and industrial units managed by bureaucracies, it thereby made the rate of growth of gross domestic product go up faster than anywhere else in the world. But at the same time, led by its ne( &aith in the mar*et economy, China also abolished the system o& uni,ersal health care8 and, after the reforms of "9D9, health insurance had to be bought by indi!iduals (e)cept in some relati!ely rare cases in which the state or some big firms pro!ide them to their employees and dependents+. 1ith this chan$e, China9s rapid pro$ress in lon$e,ity sharply slo(ed do(n" This was problem enough when .hina<s aggregate income was growing e)tremely fast, but it is bound to become a much bigger problem when the .hinese economy decelerates sharply, as it is currently doing. 4he Chinese $o,ernment is no( tryin$ hard to $radually reintroduce health insurance &or all, and the E $o,ernment under Bbama is also committed to ma*in$ health co,era$e uni,ersal" 5n both .hina and the 9&, the rectifications ha!e far to go, but they should be central elements in tac ling the economic crisis, as well as in achie!ing long-term transformation of the two societies. 6"

The re!i!al of :eynes has much to contribute both to economic analysis and to policy, but the net has to be cast much wider. 3,en thou$h .eynes is o&ten seen as a *ind o& a +rebel+ &i$ure in contemporary economics, the &act is that he came close to bein$ the $uru o& a ne( capitalism, (ho &ocused on tryin$ to stabili%e the &luctuations o& the mar*et economy ;and then a$ain (ith relati,ely little attention to the psycholo$ical causes o& business &luctuations7" 8!en though &mith and 3igou ha!e the reputation of being rather conser!ati!e economists, many of the deep insights about the importance of nonmar et institutions and nonprofit !alues came from them, rather than from :eynes and his followers. A crisis not only presents an immediate challenge that has to be faced. 5t also pro!ides an opportunity to address long-term problems when people are willing to reconsider established con!entions. 4his is (hy the present crisis also ma*es it important to &ace the ne$lected lon$/term issues li*e conser,ation o& the en,ironment and national health care, as (ell as the need &or public transport, (hich has been ,ery badly ne$lected in the last &e( decades and is also so &ar sidelined'as 5 write this article'e!en in the initial policies announced by the 0bama administration. 8conomic affordability is, of course, an issue, but as the e)ample of the 5ndian state of :erala shows, it is possible to ha!e state-guaranteed health care for all at relati!ely little cost. &ince the .hinese dropped uni!ersal health insurance in "9D9, :erala'which continues to ha!e it'has !ery substantially o!erta en .hina in a!erage life e)pectancy and in indicators such as infant mortality, despite ha!ing a much lower le!el of per capita income. &o there are opportunities for poor countries as well. *ut the largest challenges face the Enited tates, (hich already has the hi$hest le,el o& per capita e2penditure on health amon$ all countries in the (orld, but still has a relati,ely lo( achie,ement in health and has more than &orty million people (ith no $uarantee o& health care. 3art of the problem here is one of public attitude and understanding. 7ugely distorted perceptions of how a national health ser!ice wor s need to be corrected through public discussion. For e)ample, it is common to assume that no one has a choice of doctors in a 8uropean national health ser!ice, which is not at all the case. There is, howe!er, also a need for better understanding of the options that e)ist. 5n 9& discussions of health reform, there has been an o!erconcentration on the .anadian system'a system of public health care

that ma es it !ery hard to ha!e pri!ate medical care'whereas in $estern 8urope the national health ser!ices pro!ide care for all but also allow, in addition to state co!erage, pri!ate practice and pri!ate health insurance, for those who ha!e the money and want to spend it this way. 5t is not clear =ust why the rich who can freely spend money on yachts and other lu)ury goods should not be allowed to spend it on -E5s or .T scans instead. 5f we ta e our cue from Adam &mith<s arguments for a di!ersity of institutions, and for accommodating a !ariety of moti!ations, there are practical measures we can ta e that would ma e a huge difference to the world in which we li!e. The present economic crises do not, 5 would argue, call for a /new capitalism,/ but they do demand a new understanding of older ideas, such as those of &mith and, nearer our time, of 3igou, many of which ha!e been sadly neglected. $hat is also needed is a clearheaded perception of how different institutions actually wor , and of how a !ariety of organi1ations' from the mar et to the institutions of the state'can go beyond short-term solutions and contribute to producing a more decent economic world. February 25, 2008 Notes
>"?

Adam &mith, An Inquiry into the Nature and Causes of the Wealth of Nations, edited by E.7. .ampbell and A.&. & inner (.larendon 3ress, "9DC+, 5, 55.ii.28, p. 292.
>2?

&mith, he Wealth of Nations, 5, 5.!iii.2C, p. 9".

>#?

Adam &mith, he heory of !oral "enti#ents, edited by @.@. Eaphael and A.F. -acfie (.larendon 3ress, "9DC+, pp. "89G"90.
>A?

&mith, he Wealth of Nations, 5, 55.i!."B, p. #BD. A... 3igou, Industrial Fluctuations (Fondon; -acmillan, "929+, p. D#. 3igou, Industrial Fluctuations, p. 9C.

>B?

>C?

>D?

A... 3igou, he $cono#ics of Welfare (Fondon; -acmillan, "920+. .urrent wor s on economic ine%uality, including the ma=or contributions of A.*. At inson, ha!e been to a considerable e)tent inspired by 3igou<s

pioneering initiati!e; see At inson, "ocial %ustice and &ublic &olicy (-5T 3ress, "98#+.