Competition and conflict are intrinsic features of modern societies, inequality is persistent, and booms and busts are recurrent outcomes throughout capitalist history. State intervention modifies these patterns but does not abolish them. Professor Anwar Shaikh, an economics professor at the Graduate Faculty of the New School for Social Research, develops these ideas in his latest book.
Professor Shaikh’s book takes a unique approach in developing an economic analysis of modern capitalism without any reliance on conventional assumptions of either perfect or imperfect competition. The book is a brave attempt to show that one can explain these and many other observed patterns as results of intrinsic forces that shape and channel outcomes. Social and institutional factors play an important role, but at the same time, the factors are themselves limited by the dominant forces arising from “gain-seeking” behavior, of which the profit motive is the most important. These dominant elements create an invisible force field that shapes and channels capitalist outcomes. The book’s approach is very different from that of both orthodox economics and the dominant elements in the heterodox tradition. There is no reference whatsoever to an idealized framework rooted in perfect firms, perfect individuals, perfect knowledge, perfectly selfish behavior, rational expectations, and so-called optimal outcomes. Nor is there any need to explain particular observed patterns as departures from this Edenic state arising from “imperfections” of various sorts. The book develops microeconomic and macroeconomic theory from real behavior and real competition, and uses it to explain empirical patterns in microeconomic demand and supply, wage and profits, technological change, relative prices of goods and services, interest rates, bond and equity prices, exchange rates, patterns of international trade, growth, unemployment, inflation, national and personal inequality, and the recurrence of general crises such as the current one which began in 2007-2008.
Anwar Shaikh is Professor of Economics at the Graduate Faculty of Political and Social Science of the New School for Social Research. He received his BSc. from Princeton University and his PhD from Columbia University. He is an Associate Editor of the Cambridge Journal of Economics, and was a Senior Scholar and member of the Macro Modeling Team at the Levy Economics Institute of Bard College from 2000-2005. He received a Distinguished University Teaching Award from the New School in 2003, and in 2009 he was awarded an Honorary Doctorate, Honoris Causa, from Universidad Nacional Mayor de San Marcos, in Lima, Peru. He has served on many major committees at the New School, and has served three times as Chair of the Department of Economics of the Graduate Faculty.
Dr. Shaikh is the author of four books, the most recent being Capitalism: Competition, Conflict, Crises (2016, Oxford University Press). His recent articles include “The First Great Depression of the 21st Century”, Socialist Register 2011, Fall 2010; “Reflexivity, Path-Dependence and Disequilibrium Dynamics”, the Journal of Post Keynesian Economics, Fall 2010; “Economic Policy in a Growth Context: A Classical Synthesis of Keynes and Harrod”, 2009, Metroeconomica, 60(3), pp. 455-494; “Competition and Industrial Rates of Return”, 2008 Issues in Economic Development and Globalisation, Philip Arestis, John Eatwell (eds.), Palgrave MacMillan. He has also written on international trade, finance theory, political economy, U.S. macroeconomic policy, the welfare state, growth theory, inflation theory, crisis theory, and inequality on the world scale, and past and current global economic crises.