A professor of finance and economics at Yale, Robert Shiller, gives an interview to the Five Books section of the Browser Web site that is interesting for how it illuminates where he (and probably some other academic economists) are coming from. He says:
There have been political changes in the US that allow the extreme high end to garner more wealth. Ultimately, it represents a failure of our society to take account of the fact that the extreme high end can lobby and can organise for its own interests, and we've let it happen.
So you feel inequality is central to what has gone on and that we really need to address that?
Yes – and there is very little concrete talk about addressing it. It's a very difficult problem. You might think that in a system of majority voting, the middle class and the poor would dominate and would prevent this kind of inequality from developing. But it hasn't been that way – it's been even less so that way lately, especially in the US....
So how did you get interested in all this in the first place?
I think the year was 1958, when I was 11 years old, or maybe a little after that. I read Galbraith's The Affluent Society and it had a great impact on me. It talks about deep issues: we have rapidly growing wealth, but what is it doing for us? I don't know that I agree with him, but there's some element of truth to what he says, that we end up being manipulated by marketers and corporations, who try to create demand for things we don't need.
And Galbraith stuck with you and influenced your life's work?
Yes, I think that's right.