Mason Gaffney, Ph.D., a professor of economics at University of California, Riverside, knows what most economists don’t: That land speculation is the primary cause of economic recessions.
In March of this year, Gaffney forecast the imminent bursting of the Chinese economic bubble. He was correct: From June 12 through July of this year, the Shanghai stock market lost over 30% of its value. As a matter of fact, property prices—driven by increases in underlying land values—tend to undergo boom-and-bust cycles about every eighteen years. The last time China was facing an economic recession was in 1997—eighteen years ago.1
Gaffney has most recently published The Mason Gaffney Reader to great acclaim from other economists, such as economic Nobel laureate Joseph Stiglitz (although, technically, there is no such thing as an economic Nobel). Stiglitz had the following to say about Gaffney’s book:
“One of the most important but underappreciated ideas in economics is the Henry George principle of taxing the economic rent of land, and more generally, natural resources. This wonderful set of essays, written over a long and productive scholarly career, should be compulsory reading. An inveterate optimist, Mason Gaffney makes an excellent case that, by applying the Henry George principle, we can reduce inequality, and raise ample public revenues to be directed at any one of a multitude of society's ills. Gaffney also offers plausible solutions to problems of urban renewal and finance, environmental protection, the cycle of boom and bust, and conflict generated by rent-seeking multinational corporations.”
— Joseph Stiglitz
Check out The Mason Gaffney Reader’s website.
1 The 1997 economic recession primarily occurred in Hong Kong, China’s economic center at the time.
Source: American Journal of Economics and Sociology, Volume 74, Issue 2, pages 325–360, March 2015 by Mason Gaffney | Mar 19, 2015
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MARTIN ADAMS is a systems thinker and author. As a child, it pained him to see most people struggling while a few were living in opulence. This inspired in him a lifelong quest to co-create a fair and sustainable world in collaboration with others. As a graduate of a business school with ties to Wall Street, he opted not to pursue a career on Wall Street and chose instead to dedicate his life to community enrichment. Through his social enterprise work, he saw firsthand the extent to which the current economic system causes human and ecological strife. Consequently, Martin devoted himself to the development of a new economic paradigm that might allow humanity to thrive in harmony with nature. His book Land: A New Paradigm for a Thriving World is the fruit of his years of research into a part of this economic model; its message stands to educate policymakers and changemakers worldwide.