Literature/202311280955 socialize risks and privatize rewards
- Source: [[@mazzucato2018The entrepreneurial state: debunking public vs. private sector myths]]
- Tags: #risk #entrepreneurial-state
States finance high-risk research, in the sense that they do it without knowing a priori whether there'll be any kind of societal impact. States also finance infrastructure on which ventures are built (like roads and highways).
The point of the book is that states are socializing risks. It is society the one that absorbs the costs of research and its "failures".
But the open question is whether states are privatizing rewards. Once they've built the infrastructure, a private company reaps its benefits. Once the technology is mature enough, a private company builds a product around it.
A superficial reading would assume that by paying taxes these companies are giving back and incentivizing the continuation of the basic science projects.
However, the book argues that in many cases the privatization of rewards is too extreme. Between companies that are master tax evaders, and biotechs that use subsidies to repurchase stock and pay hefty bonuses to management, it can become unclear how the current approach is benefiting society as a whole.
Particularly when jobs are shipped abroad, as has been happening in the US for few decades.
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