Download - Robin Murray Methods And Tools July 2009
The Social Economy and the Crisis
Lisbon 15th July 2009
Robin Murray, Julie Caulier-Grice & Geoff Mulgan
From the micro economics of social venturing
To the macro economics of social innovation and the global economic crisis
5 propositions
Proposition 1
The present crisis is about a long wave transition from the 20th century paradigm of mass production, to what? to the 21st century paradigm of the distributed digital economy?
The historical record: bubble prosperities, recessions & golden ages
1771Britain
1829Britain
1875 Britain / USA
Germany
1908 USA
1971 USA
1890–95
Europe1929–33
USA1929–43
1848–50
2000/7–?
1793–97
TURNINGPOINTINSTALLATION PERIOD DEPLOYMENT PERIOD
Telecom mania, Internet emerging markets
and NASDAQ
London funded global marketinfrastructure build-up
(Argentina, Australia, USA)
Railway mania
Canal mania
The roaring twenties
Bubble
Sustainable global knowledge-society ”golden age”?
Post-warGolden age
Belle Époque (Europe)“Progressive Era” (USA)
The Victorian Boom
GreatBritish leap
Golden Age
Each Golden Age has been facilitatedby enabling regulation and policies for shaping and widening markets
The sequence of propagation has four phases and a break
FinancialBubble
Technologicalexplosion
Market saturation and social unrest
Golden Age
Nextbig-bang
big-bang
Deg
ree
of d
iffus
ion
of th
e te
chno
logi
cal r
evol
ution
Time
INSTALLATION PERIOD DEPLOYMENT PERIOD20 – 30 years 20 – 30 years
MATURITY
SYNERGY
FRENZY
IRRUPTION
TU
RNIN
G P
OIN
T
Crash Institutionalrecomposition
Proposition 2
Strong social and technological tides which provide the basis for the expansion of the social economy
i) Intractable Problems. Widespread recognition that the big issues not solvable with business as usual.
But the social economy is particularly well suited to tackle these issues and is the source of many innovations in these areas.
ii) Insistent voices, active lives.
The rise of expressive culture - the post modern citizen actively searching for identity, meaning and self improvement , individually and collectively through social movements
iii) Digital economy reconfiguring production around the user. The Lego principle. Households become designers, processors and assemblers. The house becomes an office/recording studio/learning lab/doctors’ surgery/power station. Rise of distributed systems and the support economy
Platforms – from the linear to the multi-nodal
Proposition 3
Social economy can become an innovative driver of economic transformation in the deployment period – social Schumpeter
Can do so only if conditions transformed in each part of the social economy and their inter-relations
The social economy
a) State. Innovation episodic and centralised. Requires transformation of public finance and systems of accountability related to it
b) Grant economy. Seed bed of innovation but fragile economically
c) Market 55,000 social enterprises in UK. Requires new mediating institutions
d) Households: conditions for participation
Proposition 4
Crisis in macro economic policy. Battle against recessions being fought with weapons of the last war.
4 differentiated counter-cyclical policies required that focus on investment and creating conditions of next wave
A) short and medium term investments that can be rapidly introduced
B) Factor Four innovations for services faced by cuts (e.g. Elderpower in Maine)
C) Innovative use of resources freed up by the market – people/land/buildings/ideas + encouraging initiatives insulated from the market (exchange systems/local food/volunteering)
D) Regulatory changes creating conditions for SI
Proposition 5
The coming years are a critical moment of danger and possibility.
• Danger from crisis (debt overhangs and credit shortage/unemployment/cuts to grant programmes & social services
• Possibilities: 1930s, Argentina, favellas
Conclusion
Just as 1930s crisis generated alternatives based on mass production model (Soviet, social democracy, fascism) so current crisis suggests alternatives based on distributed digital economy
References:
Eric Beinhocker, The Origin of Wealth, Random House, 2007Bill Ivey, Arts Inc, University of California Press, 2008Francois Jegou and Ezio Manzini, Collaborative Services: social innovation and design for sustainability, Poli Design 2008Jim Maxmin and Soshana Zuboff, The Support EconomyCarlota Perez, Technological Revolutions and Financial Capital, Edward Elgar 2002Walter Stahel, The Performance Economy, Palgrave 2006
Robin Murrayrobinmurray(AT)blueyonder.co.ukJulie Caulier-Gricejulie.caulier-grice(AT)youngfoundation.orgGeoff Mulgangeoff.mulgan(AT)youngfoundation.org