The Financial Times could use a good economics lesson

This article by Lisa Pollack in the Financial Times assumes that making investments isn't productive. I would argue that there is a reason why scientists are getting paid more in these financial markets than they were getting in science and that is they are producing more wealth there. Moving resources from lower to higher valued uses is valuable.

She approvingly cites a study that claims:

we find that industries that are in competition for resources with finance are particularly damaged by financial booms. Specifically, we show that manufacturing sectors that are either R&D-intensive or dependent on external finance suffer disproportionate reductions in productivity growth when finance booms. . . .

Finance literally bids rocket scientists away from the satellite industry. The result is that erstwhile scientists, people who in another age dreamt of curing cancer or flying to Mars, today dream of becoming hedge fund managers. . . .



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