The 21st Century Economy: Does a Sustainable Solution Space Exist?

Abstract

The emerging data-driven economy (DDE) promises to intensify the distributional issues that have contributed to disruptive political change in recent years. This raises the question of whether there a solution space in this economy that allows markets to clear and societies to maintain sustainable social compacts? This paper identifies various features of the current model of globalization that have contributed to these distributional stresses and suggests possible policy responses. In particular, for governance to keep up with the challenges, the paper argues that it is essential to bring distribution into the formal framework used to measure and manage economic performance.

Keywords: Globalization, Data-Driven Economy, Kleptonomics, Income Distribution, Social Contracts

JEL Classification: F15, F16, F18, F21, F22, F23, F36, F42, F60