An EconTalk Podcast Listening Guide

Luigi Zingales on Capitalism and Crony Capitalism

Listen to the EconTalk podcast Luigi Zingales on Capitalism and Crony Capitalism and consider these questions.

1. Early in the interview, Roberts asks Zingales about the trends he sees posing political threats to “real capitalism.” Summarize the trends Zingales describes in response.

2. How does Zingales define (American) “meritocracy?” How closely does this match your own definition of this term? To what extent do you agree with Zingales that meritocracy is at risk today?

3. Zingales uses the Masters tournament as an analogy for income inequality today. Describe the analogy. To what extent do you find this a useful analogy?

4. Zingales argues that the direct effects of Glass-Steagall on the recent financial crisis were very small, but that it had a much greater political impact. Describe these various impacts, as well as why the political impact was greater according to Zingales.

5. Roberts points to the “Tullock paradox,” which suggests that business does not spend enough on politics. Why might this be the (surprising) case, and how does Zingales react?

6. Zingales and Roberts agree that Robert Rubin serves as a good illustration of moral hazard. Why do they think this? To what extent do you agree?

7. Zingales suggests that the current decline in labor force participation is novel. What does he cite as the contributing factor(s) to this decline?

8. Roberts compliments Zingales for considering ethics in A Capitalism for the People. Why does Zingales suggest that most economists are uncomfortable dealing with ethics?