The Institute for New Economic Thinking has awarded a grant to UMKC Economics Professor L. Randall Wray, who will study “Financing Innovation: An Application of a Keynes-Schumpeter-Minsky Synthesis.” Wray will collaborate on the project with Mariana Mazzucato, of the University of Sussex in the U.K., to integrate two research paradigms that have strong policy relevance in understanding the degree to which financial markets can be reformed in order to nurture value creation and ‘capital development’, rather than value extraction, and destruction.
The first one might be called the Keynes-Minsky vision that puts effective demand front and center of economic analysis, and the second is the Schumpeter-Minsky vision that places innovation at the center of competition theory, rather than relegated to the periphery of imperfect competition. The project will bring the two visions together to provide rigorous analysis of competition in the financial sphere and how it interacts with competition in the industrial sphere. The grant will also support the work of several Interdisciplinary PhD students in the UMKC Economics Department.
The researchers believe that a new framework will help provide a better understanding of the difference between creative destruction and destructive creation, and its applicability to new periods of economic growth, such as that which will hopefully result from the green technology revolution.
Prof. Wray is a regular contributor to economics and mainstream publications and a frequent speaker and presenter at meetings and conferences around the world. This fall, he has been invited by the Central Bank of Argentina to deliver the plenary lecture at its Annual Money and Banking Conference.