William Lazonick

William Lazonick spent four decades documenting one of the most consequential transformations in American economic history: the dismantling, beginning in the 1980s, of the retain-and-reinvest corporation—a firm that kept its earnings and plowed them back into workers, research, and long-term capability—and its replacement by the downsize-and-distribute model that converts every productivity gain into shareholder returns. His analysis is not a lament. It is institutional economics at its most precise: specific intellectual architects, specific regulatory changes (above all SEC Rule 10b-18 in 1982, which legalized corporate stock buybacks), specific incentive structures that made the transformation not just possible but structurally inevitable once the rules changed. The force of his framework comes from this precision. The AI transition has not arrived in a vacuum. It has arrived in a governance environment that has spent forty years programming corporations to answer one question about every productivity gain: how quickly can we return it to shareholders? Lazonick's answer to this moment is not