Rethinking the Economy with People at its Centre
Does business have to be “as usual”? let’s check out what’s in it for us if we apply a People Centred Economy approach, and the most to the point definition comes from Steve Bosserman President Bosserman & Associates, Inc. a true specialist in local sustainable solutions. We have two types of economies, radically opposite to one another, one is Product Centred Economy, and it is something we know quite well; production is at the very centre of the economy, and through processing, preparation, and retail it’s goods and services finally reach the people. Product Centred Economy goes by three main principles:
- 1. Profit is the rule.
- 2. Me (my business, my success)
- 3. Scale up indefinitely and seek out competitive advantages. Which is a very common business model, known to most of us.
There is an alternative economy, a people-centred one, is removing production from the centre of the economy even possible? Indeed it is, because the “people” become a conscious and aware market, destined to rightfully benefit the goods and services of different producers and answering their needs, a do so in the way that is most healthy, safe, secure and convenient; therefore, the people can “rule” the system, meaning that goods and services are delivered to them on their own terms, from groceries all the way to energy supply. People Centred Economy, since it is a collective approach to the market economy, works best at the local level, and local here means neighbourhood, community, a school, actually any local group of people who collectively decide to rule the production, the keyword is consumption, because in this context the community member makes a conscious choice to purchase locally, and the choice is grounded on how affordable are the goods or services, how convenient they are, are they healthy? Safe? Secure? And once the decision is made, this will ignite the preparation, processing, retail and production flows, all in order to make the consumer happy, in other words, People Centred Economy. Guided by different principles when compared to Product Centred Economy, such as; sustainability, resilience, openness, diversity and variety.
When a potential customer can choose a good or service that is affordable, convenient, healthier and safer, the choice is an obvious, big, fat yes! Even more so if the system is designed to make the production, delivery and guarantee that it is sustainable, open and accountable, it becomes a very attractive option. Product Centred Economy is still central to many of our local realities within market economy, and does not necessarily need to be this way.
The concept is not new, it has actually been around since 1984, when USAID consultant David Korten came up with an idea that economic development strategies should not exclusively focus on finance and production, there needs also to be a parallel process concerning justice, sustainability and inclusivity. Reading this in 2022 may seem obvious, and yet for those days it was a revolution which questioned many of the developmental and economic models that dominated the market economy in the XX century. So, if this sounds obvious, are we there yet? Not at all! almost 40 years on this concept is on screen presentation at major world conferences, and what we have not grasped yet is that such a transformation needs a just as radical mindset transformation from institutions to individuals, in order to spark an ecological behaviour that matches the realities where we live and strive.
How many intergovernmental working groups, summits and conferences have taken place so far where People Centred Economy was mentioned? The answer is, a lot! A while each stressed how important it is to rethink how we do business, and somehow we keep on applying yesterday’s solutions to today’s problem; a completely different reality. However, one may think that all these international expert meetings were just a lot of chit chat and no tangible outcomes. Often times that was the case, and not always, a tangible result was the creation of the Human Development Index (HDI), born to measure the level of development of countries, a step above the well-known Gross Domestic Product (GDP) by expanding it to other areas, most importantly, sustainability; the ultimate and most important goal; economic development should be self-supporting in financial and economic terms, as well as social and environmental.
Today almost every country in the world has in place some sustainability initiatives and strategies, which is great, what is not so great is that far too many did not quite grasp that social - environmental and economic sustainability are entwined and can’t be split. Ignoring one of them will hinder the smooth forward movement and make obstacles.
We need to start locally; we need to start where the benefits are tangible and visible by the communities, and where ownership of the processes in place is easier to promote.Lorenzo Nava
People Centred Development and Sustainability can be achieved by investing in sustainable communities, where every sector from the public to private enterprises, from companies to the non-profit sectors partner up with a common goal that is the general well-being and development, that should already be clear by now. We need to start locally; we need to start where the benefits are tangible and visible by the communities, and where ownership of the processes in place is easier to promote. The alternative is non-stop economic growth and capital output at the expense of our natural resources. It is mandatory to build the capacities of communities in resource management, in order for them to answer to local and individual needs, and the first step for a successful people-centred economy is the enhancement of democratic processes, because the communities need to own their development goals, be equipped with tools for dialogue and advocacy, influence decisions about wellbeing and quality of life, and in turn decision-makers need to be accountable and transparent for the process to function and enable equal opportunities for participation, removal of obstacles. Local communities, local action, local policies, and yes it is very possible and feasible, as well as necessary.