Author(s): Edmund S. Phelps
In this book, Nobel Prize-winning economist Edmund Phelps draws on a lifetime of thinking to make a sweeping new argument about what makes nations prosper--and why the sources of that prosperity are under threat today. Why did prosperity explode in some nations between the 1820s and 1960s, creating not just unprecedented material wealth but "flourishing"--meaningful work, self-expression, and personal growth for more people than ever before? Phelps makes the case that the wellspring of this flourishing was modern values such as the desire to create, explore, and meet challenges. These values fueled the grassroots dynamism that was necessary for widespread, indigenous innovation. Most innovation wasn't driven by a few isolated visionaries like Henry Ford and Steve Jobs; rather, it was driven by millions of people empowered to think of, develop, and market innumerable new products and processes, and improvements to existing ones. Mass flourishing--a combination of material well-being and the "good life" in a broader sense--was created by this mass innovation.
Yet indigenous innovation and flourishing weakened decades ago. In America, evidence indicates that innovation and job satisfaction have decreased since the late 1960s, while postwar Europe has never recaptured its former dynamism. The reason, Phelps argues, is that the modern values underlying the modern economy are under threat by a resurgence of traditional, corporatist values that put the community and state over the individual. The ultimate fate of modern values is now the most pressing question for the West: will Western nations recommit themselves to modernity, grassroots dynamism, indigenous innovation, and widespread personal fulfillment, or will we go on with a narrowed innovation that limits flourishing to a few?
A book of immense practical and intellectual importance, Mass Flourishing is essential reading for anyone who cares about the sources of prosperity and the future of the West.
Winner of Axiom Business Book Awards: Entrepreneurship 2014.
Winner of the 2014 Gold Medal in Economics, Axiom Business Book Awards One of Choice's Outstanding Academic Titles for 2014 One of Financial Times (FT.com) Best Economics Books of 2013 A "Best Business Book of the Year for 2013" selected on LinkedIn by Matthew Bishop, Economics Editor of The Economist "The book eloquently discusses the culture of innovation, which can refer to both an entrepreneurial mind-set and the cultural achievements during an age of change... The dismal science becomes a little brighter when Mr. Phelps draws the connections between the economic ferment of the industrial age and the art of Beethoven, Verdi and Rodin."--Edward Glaeser, Wall Street Journal "[I]nquiring readers, not just academics and social scientists, will enjoy the vast learning in Phelps's sophisticated, sometimes sardonic, look at homo economicus."--Publishers Weekly "Phelps, a Nobel laureate in economics, defies categorisation. In this extraordinary book--part history, part economics and part philosophy--he proclaims individual enterprise as the defining characteristic of modernity. But he fears this dynamism is lost. One does not have to agree to recognise that Phelps has addressed some of the big questions about our future."--Martin Wolf, Financial Times "Phelps has written a book that transcends the materialist walls of standard economics... It is a book J.M. Keynes would have admired ..."--Paul DeRosa, American Interest "[F]ascinating, versatile and profound ..."--Felix Martin, New Statesman "A great book that will annoy big business and absolutely infuriate the left. I loved it."--Diana Hunter, Financial World "Nobel laureate Edmund Phelps' latest book should be read by those seeking a broader context to the challenges currently facing the global economies. In his wide-ranging and insightful book, Professor Phelps draws on historical trends and cultural shifts to present his hypothesis that a lack of dynamism in modern economies lies at the root of the current malaise... Indeed, this remarkable book addresses the central economic question of why some economies thrive while others languish."--Declan Jordan, London School of Economics Review of Books "Few leading economists ... have tried to develop Marx's contention that there is an ineluctable relationship between human psychology and market participation. This relationship is what Phelps describes as human 'flourishing.'"--Andrew Godley, International Journal of the Economics of Business "Phelps has produced an insightful work that bridges gaps among economics, sociology, and philosophy to identify countries that have the capabilities to prosper and flourish. This book is an essential read for individuals interested in better assessing countries' economies and competitive advantages."--Library Journal "The author ranges extremely widely and any student of any age will gain something from it, irrespective of political views."--Samuel Brittan, Financial Times "Phelps's book deserves credit for showing that the strength of an economy doesn't depend on small differences in the tax rate, or the tactics of a country's central bank. Phelps rightly points out that economic dynamism depends on much deeper issues like a culture's affinity for risk taking and respect for individual achievement. And he wields convincing statistics that suggest actors in our political economy, from our government, to corporations, to workers, have to some extent lost their reverence for these values."--Chris Matthews, Time.com Money & Business "I ... find his values-driven view of national prosperity fascinating--and applicable to corporate and personal prosperity. If innovation and the prosperity it yields stem from the values to which we subscribe as individuals, organizations, and nations, it stands to reason that we should be paying a great deal of attention to the particular values we adopt and espouse."--Theodore Kinni, Strategy-Business.com "[E]xciting ..."--William Watson, National Post "[W]ide-ranging... Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge and Change, a distillation of years of research and thought about the changes in values and attitudes that once unleashed wide-scale creativity and risk-taking and which are under severe threat today."--Brian Milner, Globe & Mail "The book is wide-ranging and highly eclectic: in just two pages (pp. 280-281) you'll find references to Cervantes, Shakespeare, Hume, Voltaire, Jefferson, Keats, William Earnest Henley, William James, Walt Whitman, Abraham Maslow, Rawls, Nietzsche, and Lady Gaga! ... Anyone interested in the synthesis of free markets and social justice will find this eminent thinker's distinctive version of that synthesis both illuminating and thought-provoking."--Brink Lindsey, Bleeding Heart Libertarians blog "Phelps has given us a clear warning of the dangers of corporatism. I hope that more people hear and heed the warning."--Arnold Kling, Econlog "[I]t wasn't until today that I started looking at Mass Flourishing by Edmund Phelps, about the central role of innovation in modern growth and, more, in the enabling of the good life. Obviously I should have read it last week. It looks right on theme, and it is pleasing to pick up an economics book that has a chapter on Aristotle."--Enlightened Economist "One does not have to agree to recognise that Phelps has addressed some of the big questions about our future."--Financial Times "Mass Flourishing offers a brilliant dissection of the origins, causes, and eventual decline of modern capitalism--an inclusive economy characterized by the complex unfettered interactions among diverse indigenous innovators, entrepreneurs, financiers, and consumers... This book should be accessible to general readers and is especially stimulating for graduate students and those interested in economics, sociology, history, political science, and psychology."--Choice "It applies many important aspects of Virginia political economy, making a contribution to understanding not only the positive, but also the normative implications of the rules of the game."--Rosolino Candela, Public Choice "It challenges many of our prized assumptions about what makes economies succeed."--David P Goldman, Standpoint "This is a recommended read, not only because it was written by Edmund Phelps, the 2006 Nobel Laureate in economics, but for encouraging reflection on fundamental issues related to modern life and the contemporary interpretation of Aristotle's 'the good life'. The author is such an experienced and iconic guide that it makes the journey through the subjects covered in the book an excellent read for anyone."--Jacek Klich, Central Banking Journal "It is a marvelous book that deserves to be read by everyone, but particularly those entrusted with the design of the European future."--Bjorn Wahlroos, Bloomberg Businessweek
Edmund Phelps was the 2006 Nobel Laureate in economics. He is director of the Center on Capitalism and Society at Columbia University. His many books include Designing Inclusion, Rewarding Work, and Seven Schools of Macroeconomic Thought.
Preface vii Introduction: Advent of the Modern Economies 1 PART ONE The Experience of the Modern Economy 1 How Modern Economies Got Their Dynamism 19 2 Material Eff ects of the Modern Economies 41 3 The Experience of Modern Life 55 4 How Modern Economies Formed 77 PART TWO Against the Modern Economy 5 The Lure of Socialism 113 6 The Third Way: Corporatism Right and Left 135 7 Weighing the Rivals on Their Terms 170 8 The Satisfaction of Nations 193 PART THREE Decay and Refounding 9 Markers of Post-1960s Decline 219 10 Understanding the Post-1960s Decline 237 11 The Good Life: Aristotle and the Moderns 268 12 The Good and the Just 289 Epilogue: Regaining the Modern 310 Timeline: Modernism and Modernity 325 Bibliography 337 Acknowledgments 351 Index 353