Aside from the current crises and turmoil in the region, which are likely to subside soon without causing significant harm to Jordan, this article presents a hypothetical scenario of a visit by two prominent economists to the Kingdom. I am invoking some of their most famous quotes here to highlight a different perspective on the Jordanian economy.

 

Imagine that two of the most prominent economic minds, Joan Robinson (born 1903) and Mariana Mazzucato (born 1968), arrived in Amman and met at a coffee shop to assess the Jordanian economy. The late Joan Robinson was a prominent economist from Cambridge University and a sharp critic of uncompetitive markets. She believed that the economy should be understood as it is, not as models assume it to be. The second, Mazzucato, is one of the most prominent contemporary economists, who redefined the state's role as a creator of value, not merely a regulator or corrector, and is considered one of the most important figures to have reshaped the state's role in the economy.

 

The discussion wouldn't be limited to numbers. It would delve into how the economy actually functions, how added value is created, and how the state and the market can work together to build a more productive and sustainable economy.

 

What would they say? Robinson would begin, in her characteristically critical tone, with her famous line: "The goal of studying economics is not to find ready-made answers, but to learn how not to be fooled by economists." She would then examine Jordan's economic indicators and ask a simple yet sharp question: "Does this economy reflect what the models say… or do the models ignore its reality?"

 

Joan Robinson would pose her favourite question: "Is this truly a competitive economy, or is it one shaped by invisible monopolistic forces?" and "Are the markets competitive… or is competition merely a theoretical construct?" She would look at certain sectors and observe that the number of players is limited, that prices don't fall easily after rising — meaning they are sticky — and that production isn't expanding at the desired pace. She would say, "If markets aren't competitive, don't expect strong investment or high growth." And, "The problem isn't the market itself… It's how the market works."

 

Robinson would quickly turn to the labour market. She would not only be concerned by the unemployment rate but also by its persistence. For her, high unemployment over many years doesn't signify a cyclical fluctuation but a deeper flaw in the structure of the economy. She would say, "If unemployment persists, the problem isn't wages… It's demand that isn't generating production." She wouldn't stop there, but would add, "And if demand isn't translated into domestic production, you're not just suffering from a lack of demand… but from its leakage." She thus puts her finger on one of the most important issues in the Jordanian economy: that a large portion of spending doesn't remain within the economy.

 

Here, Mariana Mazzucato would enter the discussion, shifting the focus and asking, "You're talking about the market… but where is the state in all of this?" In her view, the problem in many countries isn't whether the state is large or small, but rather that the state is "not oriented towards value creation." She would examine economic policies and ask: "Is there a clear production vision?… Is investment directed toward future sectors?… Is the state leading innovation… or waiting for the market?… The state is not just a corrector of market failures, but a partner in creating markets."

 

Mazzucato would note that Jordan possesses important elements, including relative stability for more than half a century, a strategic geographic location, and an educated human capital base. She would further point out that these elements have not yet been translated into a well-defined economic project, since "The economy does not grow only through stability, but through direction."

 

They would both agree on a central point: not all spending is created equal. Robinson would say: "If spending does not generate local production, it has little impact… It is real growth that changes the economy's capacity to produce, not just its size." Mazzucato would add, "Value is not created in consumption, but in innovation and production… and if it is not directed toward creating future value, it is wasted spending."

 

The dialogue would lead to the concept of the economic multiplier and the crucial question: Will a spent dinar remain within the economy, circulating to drive demand and then supply? Or will it quickly flow out through imports? Robinson would argue, "If the dinar isn't circulating within the economy, don't expect a significant impact." Mazzucato would add, "And if it's not directed towards creating future value, it's aimless spending."

 

After a lengthy discussion, they agreed on a three-pronged diagnosis: First, there is high economic leakage, with a large portion of demand flowing abroad, thus weakening the impact of spending on growth. Second, the market structure lacks competition, as some sectors discourage expansion and investment. Third, the state's role needs to be geared towards creating productive value.

 

Robinson suggested fostering genuine competition, breaking up inefficient monopolies, and linking prices and production to reality, not just models. Mazzucato, on the other hand, emphasised directing investment towards strategic sectors, building national priorities around areas such as water, energy, and industry, and making the state an innovation partner, not merely a regulator.

 

And they both agreed on one thing: "The problem isn't the size of the economy… It's its quality." They might leave behind a recommendation — simple yet profound: "Don't just ask: How much is the GDP growing? Ask instead: What are we producing, how are we producing it, and for whom?"

 

While this is an imaginary visit, it raises a real question: Do we want an economy that simply grows, or one that produces, innovates, and is sustainable?

 

 

The writer is a former Minister of State for Economic Affairs in Jordan