Kate Raworth has written a very compelling article about the need to redesign economies to address inequality. The change requires relinquishing old economic thinking, which said something like, “Inequality has to get worse before it can get better in a growing economy,” and replacing it with new thinking that builds on “a network of flows” which are distributive by design.
Raworth is a Senior Visiting Research Associate at the Environmental Change Institute at Oxford University and the author of Doughnut Economics: Seven Ways to Think Like a 21st Century Economist.
More from the article:
Instead of focusing foremost on income, 21st-century economists will seek to redistribute the sources of wealth too – especially the wealth that lies in controlling land and resources, in controlling money creation, and in owning enterprise, technology and knowledge. And instead of turning solely to the market and state for solutions, they will harness the power of the commons to make it happen. Here are some questions that 21st century economists have already taken on to help create an economy that is distributive by design:
Land and resources: how can the value of Earth’s natural commonwealth be more equitably distributed: through land reform, land-value taxes, or by reclaiming land as a commons? And how could understanding our planet’s atmosphere and oceans as global commons far better distribute the global returns to their sustainable use?
Money creation: why endow commercial banks with the right to create money as interest-based debt, and leave them to reap the rents that flow from it? Money could alternatively be created by the state, or indeed by communities as complementary currencies: it’s time to create a monetary ecosystem that can fulfill this distributive potential.
Enterprise: what business design models – such as cooperatives and employee-owned companies – can best ensure that committed workers, not fickle shareholders, reap a far greater share of the value that they help to generate?
Technology: who will own the robots, and why should it be that way? Given that much basic research underlying automation and digitization has been publicly funded, should a share of the rewards not return to the public purse?