Why are so many people trapped in poverty, when others are grossly well off? Why are house prices continuously rising faster than inflation? Why do people so often find themselves in jobs that give them little self of fulfilment? Why is a multinational coffee shop franchise not actually making its money from coffee?
These questions have confronted the UK economy for decades without resolution by governments of the left or right. It is the failure of economics, the author argues. Economists have long asserted that three factors of production lie at the root of their subject: land, labour and capital. Yet in the development of the subject only labour and capital have been thoroughly analysed: land has been ignored. It is hardly mentioned in modern textbooks, popular discussion and political debate. Much of the argument about industrial policy or wealth and income distribution reverts to a polarised struggle between two antagonists, labour and capital. The third factor, land, hides in the background unacknowledged yet exerting a major influence on the whole economic process.
What needs to change are deeply embedded features, which have generally been established for a very long time. They are principally the taxation system, the land tenure system, and the banking system. All three require root and branch reform.