The Economically Promised Land?

By Stefan,
on 07 September 2021

In 1930, John Maynard Keynes predicted that by the early 20th century, increasing productivity and technological developments would have taken us to the so-called ‘economically promised land’. It would be a place where everyone’s basic needs would be easily met and no one would have to work more than 15 hours a week. We passed the thresholds he calculated for this decades ago, but the promise of the economically promised land is still a long way off.

The goal has always been to organize our lives in a way that enables us to live as happily as possible. The proposed path to that goal – which Keynes’ prediction includes – is economic growth. Since the prediction, the goal and the means have become confused (economic growth is often seen as a goal), and you can wonder whether economic growth in itself is a good means at all.

With this issue in mind, I want to introduce the concept of value creation, because what exactly is it that we’re all striving for and want to contribute to? What do we create value with? I’ve been occupied with this recently, and the same question has arisen again and again: what is value, and how do we create it?

What are we striving for?
Ultimately, each individual strives for a satisfactory existence in their own way, looking for ways to increase their well-being. The pursuit of happiness is central in our lives.

There are several ways to fulfill this aspiration, and each individual will take a different approach. But there are a number of elements that can be considered prerequisites for personal happiness. These elements appear in several publications on happiness and value, such as the Bhutan Gross National Happiness index, the Happy Planet Index and Monitor of well-being & the SDGs (CBS). The elements include issues such as mental and physical health and education, but also cultural and ecological diversity and resilience.

Regardless of whether these elements really add up to happiness, this at least tells us that there are different factors that determine whether we are happy – not just economic factors, but also social and ecological ones.

However, in our current system, it is not our happiness and well-being that are central, but the economy. Because, so the promise goes, as long as the economy (and our number #1 priority: Gross National Product (GNP)) is growing, we can secure our happiness with our increasing buying power.

Value = economic growth?
In the past hundred years, we as humanity have made enormous advances. We have made gigantic strides in technological development, we have seen our economy grow many times over, and we now have more property (goods, means of transport, houses) than ever before. All of this has been made possible in part by the promise of capitalism: if the economy grows, everyone’s well-being will grow too.

The question is: have we really improved? Or could there be a grain of truth in the saying “money doesn’t buy happiness”? Have we perhaps gone a little crazy in our age-long (literally age-long, considering we have largely developed this obsession in the last 100 years) pursuit of more and more capital?

Pitfalls of our current perception of (economic) value
The main pitfall of our current focus on the economy is that it doesn’t actually solve many problems. When it comes to the environment, the most recent IPCC report speaks volumes (see Sybren’s blog post – in Dutch) If we continue like this, we will undermine our ecological buttress; the one that has always provided us all with our basic needs: food, drink and shelter.

The social side of our current paradigm has its downsides too. Global inequality has never been greater than it is now. Some 3.4 billion people are still struggling to meet their basic needs. And for us to meet our own desires, workers further back in the supply chains sometimes work in appalling conditions (for example, in cobalt mines for electronics – in Dutch)

For this reason, in the 21st century – in addition to the economy – there has been more interest in two other pillars: social and environmental. In 1994, John Elkington coined the term ‘Triple Bottom Line’, or People, Planet & Profit. Since then, efforts have increasingly been made to achieve a balanced assessment framework, in which social and ecological considerations are also represented. Yet still there is often unbalanced attention on the economic aspects, including in the Sustainable Development Goals and the Triple Bottom Line (in 2018, Elkington himself indicated that his concept has been misused for the benefit of capitalism).

In terms of value creation, however, this assessment framework with its three pillars also gives rise to a complicated situation: Are you still creating value when a certain activity or product creates value on a social and economic level, but not on an ecological one? Or on an economic and ecological level but not a social one? In other words, is it okay to crumble one of the pillars in favor of the other two? And is it still value creation if no economic value is created, but social and ecological value instead?

Perhaps for that reason there should be no distinction at all between the different themes from the point of view of value creation. We can no longer let one pillar grow by crumbling another. We must stop polishing the floor while we let the ancient foundations rot.



Figure 1 | The evolution in our perspective of value creation. For a long time, the focus has been mainly on the economy. Recently, the other pillars have come into view. In the future we may see the pillars as one, where none is at the expense of another.

Value creation is more than the sum of the parts of the three pillars. It is the completion of the search for happiness and well-being – for ourselves, but also for ecological systems (flora and fauna) with which we share the planet. Rather than deeming ourselves as separate from the ecological system and hiding behind our economic system, thinking in terms of value creation helps us rediscover our symbiotic relationships with nature and with each other. That is the first step towards a sustainable society.

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