The Third Pillar. Raghuram Rajan

      

       COPYRIGHT

      William Collins

       An imprint of HarperCollinsPublishers 1 London Bridge Street London SE1 9GF WilliamCollinsBooks.com This eBook first published in Great Britain by William Collins in 2019 Copyright © 2019, 2020 by Raghuram Rajan Cover design by Darren Haggar. Illustration by ottoGraphic Raghuram Rajan asserts the moral right to be identified as the author of this work A catalogue record for this book is available from the British Library All rights reserved under International and Pan-American Copyright Conventions. By payment of the required fees, you have been granted the non-exclusive, non-transferable right to access and read the text of this e-Book on-screen. No part of this text may be reproduced, transmitted, downloaded, decompiled, reverse engineered, or stored in or introduced into any information storage and retrieval system, in any form or by any means, whether electronic or mechanical, now known or hereinafter invented, without the express written permission of HarperCollins Publishers. Source ISBN: 9780008276300 Ebook Edition © 2020 ISBN: 9780008276294 Version: 2020-02-12

       PRAISE FOR THE THIRD PILLAR

      ‘A strikingly insightful analysis of the penalties of neglecting the critically important role of community, by concentrating too much on the perceived efficacy of the markets and the state. Rajan brings out loudly and clearly why this imbalance needs urgent correction’

      AMARTYA SEN, Professor at Harvard University,

      winner of the 1998 Nobel Memorial Prize in Economic Sciences

      ‘Rajan brings his unparalleled knowledge and experience to bear on the problem. Rajan’s account of corporate misbehaviour is very well told, and it is all the more effective coming from a professor at a prominent business school’

      ANGUS DEATON, winner of the Nobel Memorial Prize

      in Economic Sciences in 2015

      ‘The Third Pillar is a must read for everyone seeking a way to preserve democracy as we’ve known it. In Rajan’s brilliant new perspective, successful democracies require balance between competitive markets, honest governments, and healthy, local communities’

      JANET YELLEN, Distinguished Fellow in Residence at

      Brookings Institution, Chair of the Federal Reserve between 2014 and 2018

      ‘Skilfully unpicks the tensions between capitalism, democracy and community … An important and timely new book … His outlook is broadly promarket … But he has also won a reputation as a teller of uncomfortable economic truths’

       Financial Times

      ‘Insightful and impressive … As local governments get to work, they could certainly use the help of more thinkers of Mr Rajan’s calibre’

       Wall Street Journal

      ‘An incisive critique of how economists and policymakers abandoned community’

       New York Times

      ‘A superstar economist … Looks at ways to restore the glory years of liberal democracy when there were widespread opportunities to prosper’

       Daily Telegraph

      ‘An important contribution to understanding why, a decade after the crisis, the world’s politics and economics remain so brittle … Rajan, a critic trying to save capitalism from itself, makes his point in accessible, clear prose’

       The Times

      ‘Compelling … urges economists to recognize a blind spot … Having been insufficiently mindful of this over the past few decades, business and government leaders may have little option but to brace themselves for frustrated communities demanding change’

       The Economist

      ‘Fresh, insightful and engaging. Offers a brilliant reckoning with one of today’s most important and potentially crippling challenges … [His] clear and compelling case goes well beyond protecting the vulnerable. It’s also, critically, about enhancing the whole’

      Mohamed El-Erian, author of

      When Markets Collide and The Only Game in Town

      ‘We all need to start thinking about this issue right now and this book is a place to begin’

      JAMES A. ROBINSON, Professor at the University of

      Chicago, co-author of Why Nations Fail

      ‘Few economists span the worlds of policy and scholarship with such distinction as Raghu Rajan … Rajan presents a bold, original vision that significantly advances our contemporary debate on the ills of democracies and moves it onto new terrain’

      DANI RODRIK, Professor at Harvard University,

      author of The Globalization Paradox

      ‘A remarkably original and insightful take on the evolution, foundations and future of capitalism … Rajan argues convincingly that the conventional dichotomy between the state and markets misses the critical role of communities … A landmark treatise of profound depth’

      KENNETH ROGOFF, Professor at Harvard University,

      former IMF Chief Economist, author of The Curse of Cash

      ‘The Third Pillar is a work marked by depth, reach and assurance. Its author engages with the main economic issues of the day, and by never hesitating to speak truth to power leaves us wanting to engage him in argument’

       The Hindu

      ‘Insightful and thought-provoking’

       Publishers Weekly

      ‘A welcome survey of a big-picture problem’

       Kirkus Reviews

      ‘A fascinating account of how markets and the state overcame the shortcomings of feudal communities’

      International Monetary Fund

       To Radhika

      CONTENTS

       Cover

       Title Page

       Copyright

      Praise for The Third Pillar

       Dedication

       Preface

      Introduction: The Third Pillar

PART I

       HOW THE PILLARS EMERGED

1. Tolerating Avarice

2. The Rise of the Strong but Limited State

       3. Freeing the Market … Then Defending It

       4. The Community in the Balance

       PART II