Wookienomics

THE latest chapter in the “Star Wars” saga, “The Force Awakens”, was due to open in cinemas worldwide on December 16th, after The Economist went to press. Most fans will queue up to watch nail-biting lightsaber duels and catch up on the lives of beloved characters. Economists, who can render the most exciting of material dull, will be more interested in the state of the galactic economy. Did the destruction of the Death Star at the end of the sixth film in the series trigger a massive financial crisis, as a recent paper* by Zachary Feinstein, a professor of financial engineering at Washington University in St Louis, speculates? What sort of structural reforms might the new galactic government adopt?

While awaiting answers to these and other important questions, The Economist undertook an exhaustive, popcorn-fuelled examination of the first six episodes of the saga, in search of broad economic lessons. The “Star Wars” galaxy is both technologically advanced and economically stagnant, plagued by inequality and ossified political institutions. It is not entirely alien, in other words. Though far, far...Continue reading

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