Mordecai Kurz

(iii) The stock market. In 2016 Kurz defined “Monopoly Wealth” to be the wealth created by market power. It is the present value of claims to future monopoly profits due to market power. In 2019 monopoly wealth was so high that 75% of the value of all stocks was monopoly wealth. Kurz asserts that corporate capital investment is mostly financed by debt, and stock trading is mostly the trading of monopoly wealth.

His work on the theory of rational beliefs was influential in moving financial and macroeconomists away from the assumption of perfectly rational expectations. The theory of rational beliefs offered an explanation for the heterogeneity in investment behavior and, consequently, in returns. In 2004, a Festschrift was published in his honor on the topic, entitled Assets, Beliefs, and Equilibria in Economic Dynamics: Essays in Honor of Mordecai Kurz. It was edited by Charalambos Aliprantis, Kenneth Arrow, Peter Hammond, Felix Kubler, Ho-Mou Wu and Nicholas C. Yannelis.

(i) History. Kurz finds that the US has experienced rising market power at the turn of the 20th century and a second time since 1981, which Kurz calls the “Second Gilded Age.”

(ix) Views on the Biden Administration The laissez-faire policy introduced in the 1980s resulted in rising market power and inequality, combined with increases in social division and strife. A similar process under a free market policy during the Progressive era was reversed, starting in 1901, with actions and policies introduced by the reform minded President Theodore Roosevelt. In our time, the Biden administration came into power in January 2021 with growing demand for broad reforms of the role of government. Kurz suggests that the economic policy of the Biden administration, stressing active government investments in infrastructure and environment, offers the first sign of a policy reversal. It is likely to lead to a much broader reform agenda that will take some years to develop.

Kurz is the Joan M. Kenney Professor of Economics, Emeritus at Stanford University and served as the economics director of Stanford’s Institute for Mathematical Studies in the Social Sciences from 1971 to 1989. He was a Guggenheim Fellow (1977), a fellow of the Institute for Advanced Studies of the Hebrew University in Jerusalem (1979) and has been a fellow of the Econometric Society since 1971. Kurz was a Stanford research associate (1961), assistant professor at Stanford (1962), lecturer at the Hebrew University of Jerusalem (1963-1966), associate professor of economics at Stanford University (1966-1968) and full professor (1969-).

Public Investment, the Rate of Return, and Optimal Fiscal Policy (with K. J. Arrow), the Johns Hopkins Press, Baltimore (1970). Endogenous Economic Fluctuations: Studies in the Theory of Rational Beliefs, Mordecai Kurz (ed.), Springer Series in Economic Theory, No. 6, Springer Verlag, August 1997. The Market Power of Technology: Understanding the Second Gilded Age. Columbia University Press, New York (2023).

Mordecai Kurz (born November 29, 1934) is an economist whose research work has covered a variety of problems in economic theory and policy. He has written extensively on growth theory, game theory, the formation of beliefs, and the effect of market power on inequality and growth, and he has worked on various policy projects. He contributed to the design of minimum income guarantee experiments in Seattle and Denver from 1971 to 1975, and in Manitoba in 1974. He also served as a special economic advisor to President Carter’s Commission on Pension Policy in 1979.