America is home to the top business schools, the leading management consulting firms and the greatest number of Nobel laureates in economics. Yet, American businesses and the economy could do better. Run by people holding Master of Business Administration degrees, American corporations rush into things in herds. In the late 1960s, there was a scramble to form conglomerates by buying totally unrelated businesses. This proved to be a disaster. It took decades to undo this at great cost to shareholders and employees alike. In the late 1990s and early 2000s, American corporations hastened to offshore production to East Asia, often suffering a loss of reputation and intellectual property in the process. These days, they are rushing into mobile and social-media advertising, often with little efficacy. The only viable corporate strategy nowadays seems to be financial engineering: borrowing huge amounts of money to buy back stocks and to engage in mergers and acquisitions. According to a branch of microeconomics known as industrial organisation, which I studied at Harvard, rising market concentration will lead to a drop in competition and falling productivity growth. This has been borne out by a recent National Bureau of Economic Research study . In Europe and Japan, where interest rates are zero or negative, there is little economic growth and hardly any productivity growth. This deviates from traditional economic theory, which holds that low interest rates induce investment in the production side of the economy and increase economic growth. This underlines the present monetary policy of the West. Should this be a lesson to the Communist Party which is trying hard to advance the state sector and to enlarge and strengthen state-owned enterprises? The concentration of political and economic power will not lead to faster economic growth but to slower growth, if not stagnation. America’s performance has been woefully lethargic. Dr Terence Kwai, Tseung Kwan O