What Is A Progressive Economy?

What do we mean by a ‘progressive economy’?

First of all, what do we mean by an “economy”!? It’s a difficult and controversial question to answer – though humans have thought about what we now recognise as economics since ancient times, the idea of an “economy” or “the economy” as a separate entity in itself only emerged relatively recently.

One way to think about the economy is as a system that organises how we, as a society, use our resources. What sort of things do we make? How do we distribute wealth? How much time do we spend at work, and how much at leisure?

The decisions we make every day about what to do with our own resources are an important part of this organising. A trivial example: if we all started to buy bell-bottom jeans again, then more of our resources would be directed towards making these as a result of businesses responding to the rise in demand. If this became a craze, and demand outstripped the supply for businesses, then the price would rise.

In this way, markets help coordinate our resource use in response to the decisions we make as individuals. But an equally important part of this organising process are our institutions, not least our government, its laws and its policies.

Take the technologies that make a smartphone ‘smart’, for instance – GPS, touch screens, the Internet – which have revolutionised our economy and society. These were not invented by Apple or Samsung in response to market demand, but were rather the payoff of strategic government investment into game-changing tech. Similarly, our education, health and infrastructure systems are vital parts of our economy.

It’s important to remember that institutions like markets and governments can be configured to aim for certain things or to promote certain interests – governments have different economic aims, for example. A progressive economy, then, is an economy whose structure promotes progressive ends – which encourages dynamism, a fair or equitable sharing of resources, and environmental sustainability.

We know, for instance, that the austerity policies implemented in recent years have been responsible for prolonging the economic misery of the Global Financial Crisis (GFC), with the greatest burden borne by the worst-off. An alternative economic framework could have delivered a more dynamic and fair recovery.

The crucial thing is that in a democratic society, we can help reprogramme our economy to meet progressive goals. In the coming months, we will be publishing a number of resources on how we might go about this, and hope to make economics more accessible in the process. To keep updated, please sign up to our mailing list here.