3.1.1 Economic Governance Objectives
Economic governance objectives are measured here in terms of benefit to the population, and not solely to increase economic growth
Economic governance determines how wealth can be created and spent. It is a network of power relationships between individuals, companies, governments and financial institutions – all of which engage in economic transactions that are subject to regulation. These participants depend upon each other, so they all have some inherent power as necessary components of an economy. They also explicitly wield power in some relationships, where prices are set by negotiation for example.
Economic power relationships are of two types, with different criteria of acceptability:
● Some economic power depends upon the possession of authority. Authority is acceptable if it can be respected for its competence, if it enables people to create wealth, and if it works in everyone’s interests.
● The possession of money is another form of economic power. The acceptability of the Economic Dimension of governance depends partly upon the perceived fairness of the distribution of the wealth in a society – although the meaning of the word ‘fairness’ is contested. As described earlier (2.2), individualists and collectivists have different ideas about what is fair.
It is assumed here that people would prefer to have more money rather than less, so economic governance objectives must include allowing the creation of more wealth. There are other considerations, though, such as the impact of economic activity on the environment and public health.
Economic governance can therefore be said to have three objectives: to enable people to increase their wealth, to ensure fairness (whatever that is taken to mean), and to ensure that economic activity doesn’t harm other aspects of their lives.
This page is intended to form part of Edition 4 of the Patterns of Power series of books. An archived copy of it is held at https://www.patternsofpower.org/edition04/311a.htm.