How economics can help solve global crises and build sustainable and inclusive societies.

The Broker believes the world needs new, multidisciplinary global economic strategies. These strategies will shift the focus from the pursuit of endless growth, to creating a sustainable, inclusive economy that safeguards human well-being.

In recent years, the notion of a ‘green economy’ has become a central focus in policy debates. This will reach a climax at next year’s Rio+20 Summit. A green economy carries the promise of a new economic growth paradigm that is friendly to the earth’s ecosystems and can also help alleviate poverty. From that perspective, the concept of a green economy is compatible with the older concept of sustainable development. But The Broker prefers using a similar, yet subtly different term: inclusive economics. The subtle difference lies in the fact that inclusive economy focuses also on the human wellbeing in general and more specifically on collective social issues such as living wages, social protection, and health and security measures.

The concept of inclusive economics goes beyond the technological green solutions and focuses on changing our behaviour and establishing sustainable and social consumption and production patterns. That is the challenge. To make economic decisions today that take into account the human wellbeing of future generations.  

One of the main tasks for economists, therefore, is to inspire all participants in the economy – multinational companies, small and medium enterprises, governments and consumers – to change their harmful patterns of production and consumption. This requires global governance. It requires the leadership of front-running countries and institutions.

The 700-page 2006 Stern Review on the Economics of Climate Change revealed the complexity of the challenge – and that only focused on climate change. The dilemma of how to finance the transition to an inclusive and sustainable economy, has not been solved yet either. The 2011 report by the United Nations Environment Programme, Towards a Green Economy, shows that reallocating investments into a green economy may lead to slower potential economic growth on the short term, as renewable natural resources are replenished, but that it will result in faster economic growth in the long run.

The Broker will publish articles and special reports, and moderate online discussions on the question of how to make the transformation to a global sustainable and inclusive economy. These discussions will focus on issues such as climate compatible development, redeveloping the gross domestic product as a standard for measuring well-being, ecosystem valuation, the use of our limited natural resources and social protection models. Other issues that will be raised are the use of environmental and social regulations as a tool for the transition to an inclusive economy. Some might argue that these regulations are a new form of protectionism as a global inclusive economy will have a huge impact on trade and investment.

The search for a sustainable and inclusive economy is an academic and political exercise. It has meanwhile become a staple on policy makers’ agendas that will come to a climax in 2012 with the Rio +20 Summit. The challenge for this theme page is to bridge the gap between academia and policy making to help develop a global vision and new economic strategies that can solve global crises and set the agenda to achieve sustainable and inclusive societies.