Contemporary social and political mega-crisis and the goals of economics

Abstract

AbstractContemporary economic thought does not deal suitably with the tasks it faces. Neither does it provide a satisfactory explanation of the socio-economic reality, nor does it propose effective methods of solving the mounting problems, especially at the macroeconomic level, in the national economy, and in the mega-economic level, in the world economy. The beyond-GDP reality requires a beyond-GDP economic theory on which a triple balanced – economically, socially and ecologically – beyond-GDP development strategy must be based. It is necessary to formulate anew the goal of economic activity, which cannot be a simple maximization of profit and a quantitative increase in production. The short-term interests of private capital should be subordinated to the long-term public interests, which is to be fostered by appropriate reinstitutionalization of the market economy. The economics has to be more oriented towards addressing the future challenges, and not mainly be inspired by conclusions drawn from observations of past events, which is often of little use in economic policy and development strategy. The new pragmatism is needed.