Economics of the Common Good and the Shaping of Collective Goals

* Article: Mariana Mazzucato (2023) Governing the economics of the common good: from correcting market failures to shaping collective goals, Journal of Economic Policy Reform, DOI: 10.1080/17487870.2023.2280969

URL = https://www.tandfonline.com/doi/full/10.1080/17487870.2023.2280969

"Conceptualising government activity as a correction to market failure as well as placing the burden of compensating for weak states on communities does not allow for ambitious and pro-active action to be taken."

Abstract

"To meet today’s grand challenges, economics requires an understanding of how common objectives may be collaboratively set and met. Tied to the assumption that the state can, at best, fix market failures and is always at risk of “capture”, economic theory has been unable to offer such a framework. To move beyond such limiting assumptions, the article provides a renewed conception of the common good, going beyond the classic public good and commons approach, as a way of steering and shaping (rather than just fixing) the economy towards collective goals.

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Contents

From the introduction:

"Less attention has been paid to the theoretical framework guiding the state’s role in governing the economy through collaborating with other actors for the common good.

The article addresses this question by building on, while distinguishing itself from, previous work on the public good (Samuelson 1954), the global public good (Kaul, Grunberg, and Stern 1999), and the commons and common-pool resources (Ostrom 1990) – all of which have informed calls for action by governments and multilateral organisations.

...

The article argues that the increasing focus on viewing the SDGs as our collective challenges in need of a “common agenda” (United Nations Citation 2023a), requires a renewed focus on achieving objectives that are collectively considered “good”.

The article thus puts forth a framework of the common good as an objective, centring the ”what” and the “how” as central questions that guide collective economic activity. A renewed conception of the common good, one that is nested in market-shaping and public value may be a productive way of forming synergies between previous contributions while moving beyond existing shortcomings and informing what is being considered an urgent moment for collective action. It draws valuable insight from political philosophy as highlighting the relational and mutual nature of the common good.

The article puts forth a framework where the ways in which actors work together towards collective goals is guided by five key principles:

(1) purpose and directionality;

(2) co-creation and participation;

(3) collective learning and knowledge-sharing;

(4) access for all and reward-sharing; and

(5) transparency and accountability.

Section 2 reviews how the common good has been discussed in political philosophy, with an emphasis on relational attributes.

Section 3 reviews how “good” has been framed in economics, tied to a theory of markets and market failures. This section compares public goods, global public goods, the commons and common-pool resources in order to distinguish previous approaches to economic goods from a renewed theory of the common good.

Section 4 builds a new approach to the common good through five pillars.

Section 5 concludes."