The question is whether or not the wonks can save finance from itself. So long as lobbyists from the financial industry maintain the influence they currently enjoy, it’s not going to happen. Still, I enjoyed the article most because Luigi Zingales addresses a topic that comes up here from time to time:
Does finance benefit society? It’s a question that has become all too relevant in recent years, and one that academic economists need to do a much better job of answering.
Most economists assume that finance is an unmitigated good — the more opportunities people have to diversify and insure against risks, the better off they are. The 2008 financial crisis and the long string of fraud and market-rigging scandals that followed, though, have given the public a different view: The latest wave of the Chicago Booth-Kellogg School Financial Trust Index shows that 48 percent of Americans think finance hurts the U.S. economy, with only 34 percent saying that it helps.
I don’t know how I would go about addressing this in a full-length post, let alone come up with a working definition of “finance” given how broad it is, so let’s make this an open discussion . Personally, I’d put myself in the 34% camp but can understand why people think otherwise and believe some of those reasons are valid.