The global economy is getting bigger mainly as a result of developing country growth and increasing scale in the global economy. The roughly 85% of the world’s population that lives in developing countries are in a multi-decade process of moving to high-income status. In the course of this convergence process, new
challenges have emerged that call for better measurement, new analysis of growth patterns, the adaptation of existing growth models, creative responses by corporations, labour and governments at all levels, and more effective international policy coordination.
The “new” growth models will take time to develop. They will require shifts and innovations in policies, changes in values, and new coalitions to accomplish complex transitions that require coordination. These new growth models will contain essential ingredients of the “old” models: an open global economy, specialization as a function of stage of development, innovation and competition, and high levels of investment. But there will be new elements: natural resources will have prices that rise with scarcity and rising demand; negative externalities will be priced or constrained by efficient regulatory policies; and intertemporal choices and balance sheets will occupy a more central position. The new mindset will likely become similar over time to the endowment model of managing assets where the core principal is that income from the endowment should not decrease its real value over time. In other terms, it is an investment model with a very long time horizon and a zero or very low discount rate.
The Global Agenda Council on New Growth Models will help suggest agendas for analysis, measurement and action in the short to medium run that will accelerate the adaptation of the growth models to become more inclusive and sustainable. To achieve this, the council will focus on five areas: measurement of
economic performance; fiscal and financial rebalancing and trade and capital flows; distributional and sustainability challenges, interactions and trade-offs; institutional innovation; and promoting entrepreneurial ecosystems and activity.
Council Manager: Lyuba Spagnoletto, Head of Communities, Knowledge Networks and Analysis, email@example.com
Forum Lead: Jennifer Blanke, Chief Economist, Economics Pillar, Member of the Executive Committee, firstname.lastname@example.org
The global economy is growing at an unprecedented pace, bringing large swathe’s of the world’s population out of poverty. But this is not without its challenges. New Growth Models takes a...