This includes the rise of populism, growing nationalism, and a backlash against globalization and multilateralism. While GDP per capita – our conventional measure of economic prosperity – has grown reasonably steadily over the past four decades, this growth does not appear to have been matched by a steadily rising sense of social prosperity, in terms of rising wellbeing within thriving societies. Nor has this economic growth been environmentally sustainable, with further adverse repercussions on social prosperity. The persistence of national, ethnic and religious conflicts around the world, combined with rising dissatisfaction among large population groups that feel “left behind” in both the developed and developing countries, attests to the sense of alienation and disempowerment driving such decoupling of economic prosperity from social prosperity. Tackling the major challenges of our times will involve confronting the paradox of growing economic activity in an integrated global economy, accompanied by ongoing tensions arising from fragmented societies and polities.
There is widespread recognition in developed and developing countries that the way economic growth and development is conceived and practiced requires an urgent transformation. The current growth and development model is destructive of the environment and frequently harmful to social cohesion and personal empowerment. Economic success has become decoupled from social and environmental success. Capitalism’s operating system needs to be restructured to address this systemic problem and align business success with long-term human and planetary prosperity.
The purpose of economies is to serve societies and the natural world, not the other way around. This principle calls for a transformation of how growth and development is conceived and pursued. The new growth and development model takes account not only of economic success, but also social and environmental success. It recognizes that what is good for the economy is not necessarily good for society and the environment. It also acknowledges that policies are conceived under uncertainty about the conditions that they are meant to address.
The new flourishing-centered growth and development model promotes inclusion and sustainability. Furthermore, in recognition that public policy and business strategy are made in the presence of radical uncertainty, the new model also promotes adaptability and resilience. These features are not viewed as automatic by-products of economic growth, but rather as objectives to be pursued through policymaking, institution building, social norms and business goals.
The new growth and development model rests on new types of social contract, bringing the economic, social and environmental needs of citizens and the purposes of business into closer alignment with the objectives of national governments, and bringing the objectives of national governments into closer alignment with multilateral institutions.
This article’s point of departure is that most of life’s challenges are collective challenges, to be addressed through collective action that can be successful only when people act beyond enlightened…
Policy BriefThis open access book examines the chronic underperformance of economies with respect to inclusion, sustainability and resilience.
PublicationThe world is economically integrated, but socially fragmented. Thus economic progress can become decoupled from social progress. The G20 has traditionally focused on economic policy issues – economic…
Policy Brief
