That Doesn’t Work Anymore

Chapter 19 Government’s Role: Past and Future

Earlier writers on economics often referred to the topic as political economy. That phrase captures the intertwined relationship of how government polices impact the performance of the economy and vice versa. Economic models do not typically have a factor in their models for politics, as it does not fit well into quantitative analysis. However, big changes in policies can have a huge impact on the economy and specific investments. Investors have to remember that policies can change valuations.

Social media is diversifying and accelerating the communication of political ideas and causes. It may change where the influence on policy comes from and may disrupt the major political parties. There is also ...