Mariana Mazzucato, Samuel Fleischman, Anna-Hope Emerson, and Lara Merling
For decades, European economic policy has located the constraint on competitiveness and productivity in the cost of labour, prescribing wage moderation, labour-market flexibility and deregulation as the cure. But what if Europe’s binding constraint is not the cost of labour but the direction of capital? Drawing on a twenty-five-year, firm-level panel of Europe’s 300 largest publicly listed non-financial corporations, and pairing every firm-level finding with its counterpart in the national accounts, this report reveals how corporate profits have become structurally disconnected from productive investment, productivity growth and employment. Companies are able to reward shareholders through record dividend payouts and share buybacks even as Europe’s productive base erodes, innovation stagnates, and labour’s share of income is held flat. Crucially, this is a policy choice. Reversing it requires redirecting capital to serve genuine value creation and achieve crucial social and environmental goals, putting labour at the centre of the economy.
Πηγή: UCL Institute for Innovation and Public Purpose, IIPP Policy Brief Series