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Economic Models and Sustainable Growth

In 2050 our economy will be based on a more optimized and customized consumption whereas individuals are informed and empowered. They are able to decide in which economic model(s) they want to participate, depending on their needs, values and lifestyle.

Evidence

The results of all brainstormings undergone at the "Ground-breaking Policies for Future Societies" workshop, including this very vision, can be found here [http://www.flickr.com/photos/97929558@N08/sets/]

1. The “economy of common good”, an online economic system built on values that embeds the economy into the social context, into the set of constitutional value and into the ecological foundations of life, is widespread. Individuals, companies and politicians interact in a participative way to contribute to the “Common Good Balance Sheet” and thus to a sustainable future. http://www.gemeinwohl-oekonomie.org/sites/default/files/gwoe-matrix4.1_en.pdf

2. Owning our future: the emerging ownership revolution https://ec.europa.eu/digital-agenda/futurium/en/content/owning-our-future-emerging-ownership-revolution.

3. The post-scarcity world of 2050-2075 https://ec.europa.eu/digital-agenda/futurium/en/content/post-scarcity-world-2050-2075

4. In the Collaborative Economy, the crowd has built a car http://www.huffingtonpost.com/jeremiah-owyang/in-the-collaborative-econ_b_3574118.html

5. Trendspotter: share and share alike - the collaborative economy is coming http://www.thenational.ae/lifestyle/trendspotter-share-and-share-alike-the-collaborative-economy-is-coming

6. The birth of philanthrocapitalism - the leading new philanthropists see themselves as social investors http://www.economist.com/node/5517656

Implications

Besides the “classic economy/traditional business” we know today other economic models have been established. As far as individuals are aware of the scarcity of natural resources and the definition of ownership is changing, they become less interested in owning products; so they decide – where appropriate – to participate in a “shared economy” and by that taking out the most value of produced goods. They are interacting on online platforms where all information is provided and transparency is key; it is part of their social connections.

The “economy of common good”, an online economic system built on values that embeds the economy into the social context, into the set of constitutional value and into the ecological foundations of life, is widespread. Individuals, companies and politicians interact in a participative way to contribute to the “Common Good Balance Sheet” and thus to a sustainable future.

More people, when creating companies, decide to be social entrepreneurs to make their contribution to the society by tackling major social issues and offering new ideas for wide-scale change. They act as change agents for society, coming up with new solutions to social problems and then implementing them on a large scale.

New finance models for entrepreneurs and companies have been well established such as crowd funding where individuals can decide where to invest their money by accessing an online platform and contribute to raise finance for a company, even with a small amount of money. Beside the “classical” compensation/trade models also nonmonetary systems such as bartering systems are an integral part of the economy, where individuals act over internet platforms.

Communities are built around individual, local or/ and global interests and technology enables us to communicate faster, easier and more efficiently. The market is shared between big companies and self-employed people mainly cross-border, borderless. There is glocal ( global and local) governance, most visibly present in borderless, human-centric and efficient management of natural resources.

Optimization of energy use, time, and logistics is a hot topic and we are re-defining economic growth. There are new indicators to measure growth. We are all sharing responsibility for wealth creation and sustainability.

Digital technologies do produce some social isolation on the way to 2050.There are “connectors”, individuals, organizations working together to fight digital divide as not all of us yet digital natives or literate.

Key Transformative Forces:

  • importance of sustainability
  • scarcity of resources
  • technological and social innovation
  • a wider global mid-class
  • changes of lifestyles
  • demographic growth
  • growing distrust in politics
  • global interconnection

 

Challenges: 
  • Shedding the baggage associated with the economic and banking crisis to smooth the way for new investments in innovation and growth by business.
  • The speed and degree of success with which new economic models are adopted.
  • The growing scarcity of resources forces a re-think about the lifecycle of products and services. This will require a new mindset in both economy and policy especially with regard to sustainability.
  • ICT as an engine for economic growth and new economic models has to be deployed to drive open access to knowledge as well as fighting the digital divide; enabling more people to actively participate in the economy.
Opportunities: 
  • The economic crisis represents an opportunity for radical system re-design through the development of new economic ideas that pay attention to the failures of the past.
  • Social innovation / social entrepreneurs can play a key role in tackling sustainability and contribute to a more responsible handling of natural resources and our environment.
  • New success indicators can be established when measuring wealth.
  • Open access to knowledge (including scientific knowledge) within the context the closing the digital divide can help to integrate more players into the digital economy through the creation of new economic models.
Questions: 
What needs to happen encourage businesses to seek to develop value within the economic system rather extract value (for shareholders) from it?
Which new economic models are likely to prove to be successful?
How will international trade evolve if there is little or no international agreement on the regulatory framework within which new models will operate?

Underpinning policy ideas