[...] Innovation, she argues, is a collective process. And as CEOs skim billions off of share buybacks, the people and institutions who help feed their profit margins—from blue-collar workers to public-sector researchers—may not be getting the credit and cash they deserve. Making a fairer and more equal economy in such a context will mean not just redistributing wealth, but reassessing who society’s wealth creators really are. It’s to that end that Mazzucato invokes Industrial Workers of the World founder Big Bill Haywood: “The barbarous gold barons do not find the gold, they do not mine the gold, they do not mill the gold, but by some weird alchemy all the gold belongs to them.”

But the really basic problem with GDP is that by not making value judgements, we confuse rents with profits. If we don’t know the difference between value creation and value extraction activities—the kind that are charging prices or earning fees, and hence are included in GDP—we risk passing off anything included in GDP as value creation. In the process we reward those activities, so it becomes sort of a feedback loop: because they’re valuable, we consider them valuable and they will be valued by society so policymakers will try to increase those activities, and that then also increases those activities’ share of GDP.