Mariana Mazzucato

After leaders of government, business and civil society met at this year’s World Economic Forum meeting in Davos, the observation that we are living in the age of a “polycrisis” has spread. The simultaneous occurrence of multiple catastrophic events is a cornerstone of today’s socioeconomic and geopolitical climate.

In the face of challenges as immense as global warming, broken health systems, a growing digital divide, and financialised business models that are driving income and wealth inequality ever higher, it is no surprise that disillusion with politics is mounting, ideal conditions for populists promising quick fixes. But the real solutions are complex and will require investment and regulation, as well as social, organisational and technological innovations, not only by government or business, but also by individuals and organisations across civil society.

Governments, believing that policy can at best fix market failures, often do too little too late. Even public goods (like funding of basic research and development) are seen as fixing a positive externality problem, while carbon taxes are fixing a negative externality problem. Achieving transformative change that produces inclusive and sustainable growth requires less fixing and more shaping and creating of markets. This requires complementing the notion of public goods with that of the “common good”, which is not just about the what, but also the how.

The common good is an objective to be reached together through collective intelligence and sharing of benefits. It builds on the idea of the commons, but goes further by focusing on how to design the investment, innovation and collaboration needed to reach a shared objective. Common goods are the product of collective interactions and investment that require shared ownership and governance models. As a result, the rewards arising from such activities must be shared collectively. The common good also addresses the need for effective international governance, emphasised in the notion of global public goods informed by my brilliant colleague, the late Inge Kaul, who helped inform the work of our Global Commission on the Economics of Water.

In his May 2015 encyclical, Laudato Si’: On Care for Our Common Home, Pope Francis argued eloquently for common-good thinking in an ever-changing world. This is not just abstract idealism. The common good offers a useful framework both for setting shared goals and for working out how to achieve them. Francis talks about the need for subsidiarity (the principle that particular issues are best addressed at the most local level possible), and that we view the world through the eyes of the most vulnerable.

The priority for all social, economic and political change, according to Francis, should be to protect the essential conditions that sustain human life. Decision-making for the common good means defending the dignity of the socially, politically and economically marginalised, not just with words but with policies and new forms of collaboration. It means building a network of solidarity through which the unheard can partake in critical decision-making processes.

These objectives can be advanced through a new growth model pursued with those who have been excluded, not simply implemented on their behalf. Co-op organisations, for example, have proved effective in bringing people of limited means together and giving them opportunities for agency that they would not have had otherwise.

Francis also understands that, with some economic sectors now exercising more power in certain domains than governments do, it is the state’s obligation to defend the common good on everyone’s behalf. Countering this trend and tackling our biggest challenges will require a fundamental change in political economy. Whereas the principle of the common good currently is seen as a corrective for the current system’s excesses, it should constitute the system’s central objective.

Money is not enough. Equally important is the type of collaboration we foster. In the case of COVID-19, we made massively successful collective investments in the research to create vaccines. But we did not ensure that the final result translated into a “common good”: Namely, a fully immunised global population.

All too often, we are lazy about partnerships. Just because you have “partnered” does not mean that you are working well together for the common good, which requires also setting the objective together and aligning risks and rewards. All parties must be on the same page about the “what” in addition to the “how”. That is how you not only develop vaccines but also make them accessible to all.

With a common-good approach, each step of the process is almost as important as the final result. In the United States, the government funnels billions of dollars of public investment into health R&D each year ($45 billion from the National Institutes of Health alone in 2022), but then allows all the profits to be kept in private hands. When the “rewards” from a collective effort materialise, often as profits for business, or as valuable knowledge, they should be shared to the same extent that the risk was shared.

As I show in my book Mission Economy, there are many ways to do this. Intellectual property or pricing conditions could be attached to public support, or profit sharing could be required, such as through an equity model. Collective ownership structures can also help share value more equitably with all members of society. These arrangements all offer opportunities to challenge the undue concentration of power in the hands of a few privileged individuals and firms.

Nor are these problems confined to health. The digital economy has been expanding on the back of massive public investments for years. Because most of the data is controlled by a few powerful companies, key technologies such as artificial intelligence are reproducing pre-existing biases and injustices. To counter this, we need to design a more inclusive and transparent framework — requiring, for example, that digital services’ terms and conditions meet certain ethical standards.

Finally, we must encourage a greater appreciation for the power of collective intelligence. In the same way that ESG (environmental, social, and governance) metrics help companies report on their organisational culture and behaviour, a common-good approach would require more robust reporting on inter-organisational and public-private dynamics to capture the whole ecosystem of collaboration (or parasitism, as the case may be).

The common good is about intense collaboration, collective intelligence, the co-creation of both ends and means, and a proper sharing of risks and rewards. Mission-oriented industrial and innovation policies show how these principles can be put into practice. A government or international body sets a clear target, often in consultation with other stakeholders, and then creates the conditions for intense public-private collaboration to get there. Critical to this process is trial and error. While the direction of travel must be clear, there also should be plenty of room for bottom-up experimentation.

The common good is a shared objective. By emphasising the how as much as the what, it offers opportunities to promote human solidarity, knowledge sharing and collective distribution of rewards. It is the best, indeed the only, way to ensure a decent quality of life for everyone on an interconnected planet.

Mariana Mazzucato, founding director of the UCL Institute for Innovation and Public Purpose, is chair of the World Health Organisation’s Council on the Economics of Health for All. Copyright: Project Syndicate, 2023.

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