Finance & economics | Free exchange

A new book argues weakened communities threaten liberal democracy

Raghuram Rajan’s “The Third Pillar” says that society matters

UNTIL RECENTLY, economists’ prescription for struggling places was bloodless: let them die. “Some towns cannot be preserved”, this newspaper argued in 2013, attracting a larger-than-usual volume of correspondence from dissenting readers. But the electoral successes of Donald Trump and the campaign to yank Britain out of the European Union (EU) have shaken the dismal science. Prominent economists have begun to consider what an efficient response to geographic inequality might look like. In a paper published in 2018, for example, Benjamin Austin, Edward Glaeser and Lawrence Summers of Harvard University argued for employment subsidies targeted at struggling places.

This article appeared in the Finance & economics section of the print edition under the headline “Pillar of strength”

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