21st century challenge: new strategy to share prosperity

I recommend a short article by Brian Arthur, economist and one of the founders of Complexity Theory. It illustrate as the challenge of today economy is distributing prosperity but employment is not a strategy anymore.

The impact of digital technology has skyrocketed economic productivity but is destroying jobs which have been the sources of wealth redistribution for the last two centuries. We need new solutions to to redistribute wealth or end up with untenable social unrest.

Arthur provides the theoretical background for the mission of organisations like the Young Foundation as sources of disruptive innovation to pilot new patterns of social development.

The second economy. Digitization is creating a second economy that’s vast, automatic, and invisible—thereby bringing the biggest change since the Industrial Revolution.
October 2011 | byW. Brian Arthur
 
“The second economy will certainly be the engine of growth and the provider of prosperity for the rest of this century and beyond, but it may not provide jobs, so there may be prosperity without full access for many. This suggests to me that the main challenge of the economy is shifting from producing prosperity to distributing prosperity. The second economy will produce wealth no matter what we do; distributing that wealth has become the main problem. For centuries, wealth has traditionally been apportioned in the West through jobs, and jobs have always been forthcoming. When farm jobs disappeared, we still had manufacturing jobs, and when these disappeared we migrated to service jobs. With this digital transformation, this last repository of jobs is shrinking—fewer of us in the future may have white-collar business process jobs—and we face a problem.
 
The system will adjust of course, though I can’t yet say exactly how. Perhaps some new part of the economy will come forward and generate a whole new set of jobs. Perhaps we will have short workweeks and long vacations so there will be more jobs to go around. Perhaps we will have to subsidize job creation. Perhaps the very idea of a job and of being productive will change over the next two or three decades. The problem is by no means insoluble. The good news is that if we do solve it we may at last have the freedom to invest our energies in creative acts.”
 

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