What the 'third story of capitalism' should be about

This unusual presentation will be my last in this seminar series. I will not present a research article, but some of the `bigger ideas’ which guide me in the research questions I choose to work on. Participants are kindly asked to familiarise themselves with the “two stories of capitalism”-idea through 90 second videos before the talk: “Capitalism is exploitation” and “Capitalism is liberation.”
I argue that, on the one hand, contemporary textbook neoclassical economics has a `liberation bias’ as three important elements are largely absent from its models: (i) economic rents on fixed production factors, (ii) substantial assumptions about heterogeneous behaviour and (iii) welfare-reducing consumption. Changing this, however, results in a return to old economic thinking in a sense, that is, to an age of competing economic theory frameworks. On the other hand, I claim that our standard normative evaluations of policy have an `exploitation bias’: The dominant normative criteria in economics only acknowledge the moral language of liberal egalitarians. I argue that new economic thinking will need to find innovative ways of conceptualising broader moral motives in economic models to make progress on policy issues central to our INET community, such as climate change, automation and inequality.