Neoclassical economic theories are no longer relevant. They are the reason why the earth’s resources have been depleted so as to jeopardise the future. They have created a world in which extreme poverty abounds and the rich just get richer. That’s the contention of English economist Kate Raworth, who champions a new economy mirroring nature, in which responsible ESG policies are the norm.
As far as known, human society today is the most complex system in the universe. However, complex systems are fragile and unstable, so maintaining our complex society is a particularly interesting and difficult challenge.
Purely numerical approaches to the economy are grossly and demonstrably inadequate. It’s high time for financial institutions to let go of one-sided views and consider all the various facets of the world around us. This is the holistic approach espoused by leading American economist Pippa Malmgren.