Indigo Era (economics)
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The Indigo Era (or Indigo economies) is a concept publicized by businessman
Mikhail Fridman Mikhail Maratovich Fridman (also transliterated Mikhail Friedman; russian: Михаил Маратович Фридман; he, מיכאיל פרידמן; born 21 April 1964) is a Ukrainian-born, Russian–Israeli businessman, billionaire, and ...
, describing what he views as an emerging new era of economies and economics based on ideas, innovation, and creativity, replacing those based on the possession of
natural resources Natural resources are resources that are drawn from nature and used with few modifications. This includes the sources of valued characteristics such as commercial and industrial use, aesthetic value, scientific interest and cultural value. O ...
. Fridman is the co-founder of
LetterOne LetterOne Holdings S.A. (LetterOne) is an international investment business based in Luxembourg. Its investments are focused on the Telecommunication, telecoms, technology and Energy industry, energy sectors through its two main business units, ...
, an international investment business, and first publicized the idea in early 2016. The word "indigo" was initially chosen based on the term
indigo children Indigo children, according to a pseudoscientific New Age concept, are children who are believed to possess special, unusual, and sometimes supernatural traits or abilities. The idea is based on concepts developed in the 1970s by Nancy Ann Tappe, ...
, which has been used to describe people with unusual and innovative abilities. Fridman describes the Indigo Era as a disruptive era driven by extraordinary levels of human creativity, where abnormally talented individuals and entities are able to realize new levels of human potential and economic achievement. It is "a new economic era where the main source of national wealth is no longer
resource rent In economics, rent is a surplus value after all costs and normal returns have been accounted for, i.e. the difference between the price at which an output from a resource can be sold and its respective extraction and production costs, including norm ...
but the socio-economic infrastructure that allows every person to realise his or her intellectual or creative potential." But, according to Fridman – based on his observations of recent economic indicators, political and market volatility, and historical patterns – it is also an era that will generate winners and losers as lagging countries and groups fail to adapt quickly enough. In late 2016 LetterOne's ''Global Perspectives'' journal published an Indigo Index, ranking 152 countries on their ability to compete and grow as economies move away from being powered by natural resources to being powered by ideas, creativity, and digital skills. In 2017 it launched the Indigo Prize, to award new concepts of economic measurement beyond mere
GDP Gross domestic product (GDP) is a monetary measure of the market value of all the final goods and services produced and sold (not resold) in a specific time period by countries. Due to its complex and subjective nature this measure is ofte ...
as countries in the 21st century transition into economies where innovation, creativity, and digital skills are economic drivers. The competition is intended to "stimulate debate about factors currently measured, given evolving economies, technology and skill bases, and what should now be taken into consideration in official economic statistics that measure the health, size and growth of a modern economy."


Origin

In an April 2016 article in ''
RealClearPolitics RealClearPolitics (RCP) is an American political news website and polling data aggregator formed in 2000 by former options trader John McIntyre and former advertising agency account executive Tom Bevan. The site features selected political ...
'', retitled and reprinted in May 2016 in the ''
Jerusalem Post ''The Jerusalem Post'' is a broadsheet newspaper based in Jerusalem, founded in 1932 during the British Mandate of Palestine by Gershon Agron as ''The Palestine Post''. In 1950, it changed its name to ''The Jerusalem Post''. In 2004, the paper w ...
'', and reprinted in November 2016 under the original title in LetterOne's ''Global Perspectives'' journal, Fridman wrote: LetterOne's ''Global Perspectives'' website adds that the indigo symbolism "embodies a breaking of the norm, something that is highly reflective of the new era that we are entering into, one that lacks convention and is driven by innovation."


Analysis

In a series of articles published in 2016, Fridman cites the recent extreme volatility in markets, and worldwide political change and instability, as signs of an emerging global shift.Fridman, Mikhail
"Поколение индиго. Вход свободный"
(in Russian). ''
Forbes ''Forbes'' () is an American business magazine owned by Integrated Whale Media Investments and the Forbes family. Published eight times a year, it features articles on finance, industry, investing, and marketing topics. ''Forbes'' also re ...
''. 5 May 2016.
Fridman, Mikhail
"The Indigo Generation. Admission Free"
ABH Holdings. 5 May 2016.
"Searching for Growth in an Unstable Global Economy: A conversation with Mikhail Fridman and Anatole Kaletsky"
'' Milken Institute Review''. 3rd Quarter 2016: 7 July 2016. pp. 68–76. (Reprinted

He notes two frequently cited prominent indicators of an economic shift: the sharp decline in prices of natural resources including oil, and the slowing of China's economic growth despite this decline in the cost of natural resources.Fridman, Mikhail
"Fundamentals of a strong economy"
ABH Holdings. 30 September 2016.
He and other commentators also note the rise of populism and populist leaders and candidates, both right-wing and left-wing, as these changes occur. Stanley Greenberg, Greenberg, Stanley
"We Need a New Progressive Era of Renewal"
''Global Perspectives''. Volume 1. November 2016.
Meanwhile, companies like
Apple An apple is an edible fruit produced by an apple tree (''Malus domestica''). Apple fruit tree, trees are agriculture, cultivated worldwide and are the most widely grown species in the genus ''Malus''. The tree originated in Central Asia, wh ...
and
Google Google LLC () is an American multinational technology company focusing on search engine technology, online advertising, cloud computing, computer software, quantum computing, e-commerce, artificial intelligence, and consumer electronics. ...
– digital and technological companies he calls "Indigo companies" – have replaced longterm traditional natural-resource or manufacturing companies such as
Exxon ExxonMobil Corporation (commonly shortened to Exxon) is an American multinational oil and gas corporation headquartered in Irving, Texas. It is the largest direct descendant of John D. Rockefeller's Standard Oil, and was formed on November 30, ...
as the world's largest companies. Fridman observes that throughout history innovations, alternatives, and technologies have always overcome any perceived shortages of any natural resource. He therefore posits that the new "Indigo era", fueled by digital and technological resources, will be marked by a shift away from the struggle for natural resources and their perceived scarcity, to a reliance on ideas, innovation, and creativity and on supporting the intellectual and creative potential of each human being: "The world has entered a new era where the source of a nation's wealth is no longer natural resources. Intellectual capacity has now replaced land, raw materials and trade routes as the biggest source of wealth." According to Fridman, three interconnected factors are needed for successful Indigo companies and an Indigo economy:文丨陳召強
"讓我們在灰霾中瞭望靛藍指數,這次比的不是天空"
(in Chinese). ''KK News''. 19 December 2016.
*intuitive individual talent and a high level of education, plus the ability to form a team of equally educated and gifted people *a sophisticated and complex ecosystem, which includes not only legal systems that protect physical and intellectual property rights and protection from takeover by larger companies, but also thousands of suppliers and subcontractors to supply high-quality services which range from venture capital to marketing to web design and other technologies and services *a global digital infrastructure to distribute new products and accumulate customer data and customer-behavior insight He notes that most emerging economies have focused on building physical structures (roads, buildings, cities, physical infrastructure) rather than the complex legal, political, and social systems, institutions, and changes that will support an effective free and innovative intellectual-resource economy. The freedoms, protections, and political and legal frameworks of developed Western countries rest on centuries-long histories, socio-political traditions, and mindsets, and therefore will be difficult to replicate quickly in emerging economies. Fridman singles out India as an emerging country that has adequate legal infrastructure and freedom to probably survive the Indigo shift. Fridman considers the growth of Indigo economies to be a paradigm shift; he states that the pace at which technology is developing is creating worldwide tectonic shifts, and predicts huge global change over the next five to ten years. He and other analysts predict that the growing economic gap between free, creative economies and groups in contrast to repressive, authoritarian, totalitarian, or tradition-bound economies or groups will widen and create resentment and hostilities – whether this is between nations or within nations."Editorial"
''Global Perspectives''. Volume 1. November 2016.
Those left behind may be either emerging countries, or the average person – as opposed to the intellectual elites – within developed Western countries. Authoritarian leaders and authoritarianism often rise during periods of uncertainty and insecurity and economic deprivation. Fridman maintains however that in this ever-changing new economic era, the main source of wealth in a country or region will no longer be a natural resource, but a social infrastructure that will allow everyone to realise their intellectual and creative potential. Therefore, he asserts that "The future Indigo economy is an economy of free people. And this means that the world will become more and more free." In November 2016
LetterOne LetterOne Holdings S.A. (LetterOne) is an international investment business based in Luxembourg. Its investments are focused on the Telecommunication, telecoms, technology and Energy industry, energy sectors through its two main business units, ...
launched a journal, ''Global Perspectives'', as a platform to explore "the new emerging economic era, the Indigo era, from different perspectives, including education, religion, politics, economics, history and business" and to examine "global issues through the eyes of leading commentators and business people around the world". The inaugural issue contained articles by Fridman,
Dominic Barton Dominic Barton (born 1962), known as Bao Damin ( zh, 鲍达民) in China, is a Ugandan-born Canadian business executive, author, and diplomat. He is the current chairman of the private investment firm LeapFrog Investments as well as the chancellor ...
,
Michael Bloomberg Michael Rubens Bloomberg (born February 14, 1942) is an American businessman, politician, philanthropist, and author. He is the majority owner, co-founder and CEO of Bloomberg L.P. He was Mayor of New York City from 2002 to 2013, and was a ca ...
,
Stan Greenberg Stanley Bernard Greenberg (born May 10, 1945) is an American pollster and political strategist affiliated with the Democratic Party. Greenberg is a founding partner of Greenberg Quinlan Rosner Research (GQR) and Democracy Corps, political consul ...
,
Carl Bildt Nils Daniel Carl Bildt (born 15 July 1949) is a Swedish politician and diplomat who was Prime Minister of Sweden from 1991 to 1994. He was the leader of the Moderate Party from 1986 to 1999. Bildt served as Sweden's Minister for Foreign Affairs ...
,
Vince Cable Sir John Vincent Cable (born 9 May 1943) is a British politician who was Leader of the Liberal Democrats from 2017 to 2019. He was Member of Parliament (MP) for Twickenham from 1997 to 2015 and from 2017 to 2019. He also served in the Cabinet a ...
, Ken Robinson,
Brent Hoberman Brent Shawzin Hoberman (born 25 November 1968) is a British entrepreneur and investor. During the dot-com boom, he co-founded lastminute.com with Martha Lane Fox in 1998, where he was CEO from its inception, before selling the business to Sab ...
,
Alex Klein Alex Klein (born 1964, Porto Alegre) is an oboist who began his musical studies in his native Brazil at the age of nine, and made his solo orchestral debut the following year. At the age of eleven he was invited to join the Camerata Antigua, one o ...
,
Deirdre McCloskey Deirdre Nansen McCloskey (born Donald N. McCloskey; September 11, 1942 in Ann Arbor, Michigan) is the distinguished professor of economics, history, english, and communication at the University of Illinois at Chicago (UIC). She is also adjunct pr ...
,
Yuri Milner Yuri Borisovich (Bentsionovich) Milner (russian: Юрий Борисович (Бенционович) Мильнер; born 11 November 1961) is a Soviet-born Israeli entrepreneur, venture capitalist and physicist. He is a cofounder and former c ...
,
Nick D'Aloisio Nicholas D'Aloisio (born 1 November 1995) is a British computer programmer and internet entrepreneur. He is the founder of Summly, a mobile app which automatically summarises news articles and other material, which was acquired by Yahoo for $30M ...
,
Lynda Gratton Lynda Gratton (born February 1955) a British organizational theorist, consultant, and Professor of Management Practice at London Business School and the founder oHSM Advisory known for her work on organisational behaviour. Biography Born in ...
,
Parag Khanna Parag Khanna (born 27 July 1977 in Kanpur) is an Indian American specialist in geopolitics and globalization. He is the managing partner of FutureMap, and former managing partner of Hybrid Reality as well as Co-Founder & CEO of Factotum. Early lif ...
,
Ian Goldin Ian Andrew Goldin is a South African-born British professor at the University of Oxford in England, and was the founding director of the Oxford Martin School at the University of Oxford. He is Professor of Globalisation and Development, holds a ...
, George Freeman,
Ian Bremmer Ian Arthur Bremmer (born November 12, 1969) is an American political scientist and author with a focus on global political risk. He is the president and founder of Eurasia Group, a political risk research and consulting firm with principal offic ...
, and others.


Indigo Index and Indigo Score

The November 2016 inaugural issue of ''Global Perspectives'' also published an Indigo Index,"Indigo Score"
''Global Perspectives''. Volume 1. November 2016.
which rated 152 countries based on five key metrics for doing business as economies move away from being powered by natural resources to being powered by creativity and digital skills.Solomon, Shoshanna
"Israel ranks only 36th out of 152 nations in new innovation index"
''
Times of Israel ''The Times of Israel'' is an Israeli multi-language online newspaper that was launched in 2012. It was co-founded by Israeli journalist David Horovitz, who is also the founding editor, and American billionaire investor Seth Klarman.
''. 7 December 2016.
The five metrics are: creativity and innovation, economic diversity, digital economy, freedom, and stability and legal frameworks,"Denmark ranks fourth of 152 countries in new innovation index"
'' Copenhagen Capacity''. 13 December 2016.
which were scored based on over 30 measures from published data sources such as the
World Bank The World Bank is an international financial institution that provides loans and grants to the governments of low- and middle-income countries for the purpose of pursuing capital projects. The World Bank is the collective name for the Interna ...
,
UNESCO The United Nations Educational, Scientific and Cultural Organization is a specialized agency of the United Nations (UN) aimed at promoting world peace and security through international cooperation in education, arts, sciences and culture. It ...
, the
CIRI Human Rights Data Project From 2004 to 2014, the Cingranelli-Richards (CIRI) Human Rights Data Project annually rated the level of government respect for a variety of internationally recognized human rights. The final CIRI data set contains quantitative indicators of 15 huma ...
, the
Center for International Development The Harvard Kennedy School (HKS), officially the John F. Kennedy School of Government, is the school of public policy and government of Harvard University in Cambridge, Massachusetts. The school offers master's degrees in public policy, public ...
at
Harvard University Harvard University is a private Ivy League research university in Cambridge, Massachusetts. Founded in 1636 as Harvard College and named for its first benefactor, the Puritan clergyman John Harvard, it is the oldest institution of higher le ...
, and the
Global Education Monitoring Report The 'Global Education Monitoring Report (GEM Report)'' was launched in 2016. Previously titled the Education foAll GlobalMonitoring Report, it published 12 Reports from 2002 until 2015, and was then renamed and relaunched under a new UN mandate to m ...
.Elliott, Larry
"UK's digital strength could mean bright economic future – study"
''
The Guardian ''The Guardian'' is a British daily newspaper. It was founded in 1821 as ''The Manchester Guardian'', and changed its name in 1959. Along with its sister papers ''The Observer'' and ''The Guardian Weekly'', ''The Guardian'' is part of the Gu ...
''. 7 December 2016.
A.D
"Te państwa mają największe szanse na dynamiczny rozwój. Wielka Brytania w czołówce"
(in Polish). ''
Forsal ''Forsal.pl'' is a Polish language web site covering financial and business news. It has a readership of approximately 500.000 unique visitors per month and has roughly 3 million page views per month. Forsal.pl has been ranked among the 10 most in ...
''. 9 December 2017.
The index sought to measure a country's entrepreneurial ecosystem, and therefore its potential to adapt and develop.Scott, Patrick
"UK among top five countries best equipped for the post-Brexit era, new study shows"
''
The Telegraph ''The Telegraph'', ''Daily Telegraph'', ''Sunday Telegraph'' and other variant names are popular names for newspapers. Newspapers with these titles include: Australia * ''The Telegraph'' (Adelaide), a newspaper in Adelaide, South Australia, publ ...
''. 7 December 2016.
"Nordics among best countries in new innovation index"
Scandinavian-Polish Chamber of Commerce. 14 December 2016.
Each country was given a combined overall Indigo Score, with 200 being the highest possible score.Zhao, Ziye
"World Indigo Index Ranking"
. ''Chartist.co''. 22 December 2016.
The 10 top-ranked countries were Sweden, Switzerland, Finland, Denmark, the UK, the Netherlands, Norway, Germany, Ireland, and Japan."New Innovation Index"
. ''Knowledge Library''. ''KnowledgeBusiness.com''. 22 December 2016.
Stokel-Walker, Chris
"How to Be Optimistic About a Post-Brexit Britain"
''
Bloomberg News Bloomberg News (originally Bloomberg Business News) is an international news agency headquartered in New York City and a division of Bloomberg L.P. Content produced by Bloomberg News is disseminated through Bloomberg Terminals, Bloomberg Televi ...
''. 5 December 2016.
The United States was 18th overall. The report also included three key findings: Creativity and innovation was the biggest overall driver of high scores; this accentuated the importance of fostering entrepreneurialism and lifelong learning and of investing heavily in people. Nordic countries scored particularly high on the Indigo Index, with three Nordic countries in the top four and four Nordic countries in the top ten; this was attributed to their high rankings both in creativity and innovation and in freedom. And the lowest-scoring countries were beset with social and political problems, such as
war War is an intense armed conflict between states, governments, societies, or paramilitary groups such as mercenaries, insurgents, and militias. It is generally characterized by extreme violence, destruction, and mortality, using regular o ...
, political turmoil, and
corruption Corruption is a form of dishonesty or a criminal offense which is undertaken by a person or an organization which is entrusted in a position of authority, in order to acquire illicit benefits or abuse power for one's personal gain. Corruption m ...
.


Indigo Prize

In July 2017, LetterOne's ''Global Perspectives'' journal announced the Indigo Prize, to stimulate discussion towards finding a new way of measuring the economy in the 21st century that moves beyond the limitations of mere GDP measurements."Major new economics competition launched - £100,000 Indigo Prize"
LetterOne LetterOne Holdings S.A. (LetterOne) is an international investment business based in Luxembourg. Its investments are focused on the Telecommunication, telecoms, technology and Energy industry, energy sectors through its two main business units, ...
. 5 July 2017.
Aldrick, Philip. "Win £100,000 if you can measure the economy". ''
The Times ''The Times'' is a British daily national newspaper based in London. It began in 1785 under the title ''The Daily Universal Register'', adopting its current name on 1 January 1788. ''The Times'' and its sister paper ''The Sunday Times'' (fou ...
''. 5 July 2017. Reproduced

Gus O'Donnell, O'Donnell, Gus; Hoberman, Brent.
"Think beyond GDP to measure the true success of an economy"
''
Evening Standard The ''Evening Standard'', formerly ''The Standard'' (1827–1904), also known as the ''London Evening Standard'', is a local free daily newspaper in London, England, published Monday to Friday in tabloid format. In October 2009, after be ...
''. 6 July 2017.
Entrants were asked to submit an essay of up to 5,000 words answering the question: Entries were due 15 September 2017, and were open worldwide to groups or individuals over the age of 16, with entries particularly encouraged from people at academic institutions, businesses, charities, think tanks, consultancies, or other organisations. The award amount was announced as £100,000, with second- and third-place winners to receive £25,000 and £10,000. The judging panel included:"The Indigo Prize"
London Business School London Business School (LBS) is a business school and a constituent college of the federal University of London. LBS was founded in 1964 and awards post-graduate degrees (Master's degrees in management and finance, MBA and PhD). Its motto is " ...
. 27 June 2017.
*
Dominic Barton Dominic Barton (born 1962), known as Bao Damin ( zh, 鲍达民) in China, is a Ugandan-born Canadian business executive, author, and diplomat. He is the current chairman of the private investment firm LeapFrog Investments as well as the chancellor ...
, global managing partner at
McKinsey & Company McKinsey & Company is a global management consulting firm founded in 1926 by University of Chicago professor James O. McKinsey, that offers professional services to corporations, governments, and other organizations. McKinsey is the oldest and ...
*
Mervyn Davies Thomas Mervyn Davies (9 December 1946 – 15 March 2012), often known as "Merv the Swerve", was a Welsh rugby union player who won 38 caps for Wales as a No. 8. Early life Davies was born in Swansea, where he attended Penlan County School ...
, non-executive chairman of
LetterOne LetterOne Holdings S.A. (LetterOne) is an international investment business based in Luxembourg. Its investments are focused on the Telecommunication, telecoms, technology and Energy industry, energy sectors through its two main business units, ...
, former
Minister of State Minister of State is a title borne by politicians in certain countries governed under a parliamentary system. In some countries a Minister of State is a Junior Minister of government, who is assigned to assist a specific Cabinet Minister. In o ...
for Trade, Investment and Small Business, former chairman and CEO of
Standard Chartered Standard Chartered plc is a multinational bank with operations in consumer, corporate and institutional banking, and treasury services. Despite being headquartered in the United Kingdom, it does not conduct retail banking in the UK, and around 9 ...
*
Stephanie Flanders Stephanie Hope Flanders (born 5 August 1968) is a British economist and journalist, currently the head of Bloomberg News Economics. She was previously chief market strategist for Britain and Europe for J.P. Morgan Asset Management,JP Morgan Asset Management JPMorgan Chase & Co. is an American multinational investment bank and financial services holding company headquartered in New York City and incorporated in Delaware. As of 2022, JPMorgan Chase is the largest bank in the United States, the w ...
and former
BBC #REDIRECT BBC #REDIRECT BBC Here i going to introduce about the best teacher of my life b BALAJI sir. He is the precious gift that I got befor 2yrs . How has helped and thought all the concept and made my success in the 10th board exam. ...
...
economics editor * Jim O'Neill, former
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, former
Goldman Sachs Goldman Sachs () is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered at 200 West Street in Lower Manhattan, with regional headquarters in London, Warsaw, Bangalore, H ...
chief economist *
Lynda Gratton Lynda Gratton (born February 1955) a British organizational theorist, consultant, and Professor of Management Practice at London Business School and the founder oHSM Advisory known for her work on organisational behaviour. Biography Born in ...
, author and professor of Management Practice at the
London Business School London Business School (LBS) is a business school and a constituent college of the federal University of London. LBS was founded in 1964 and awards post-graduate degrees (Master's degrees in management and finance, MBA and PhD). Its motto is " ...
*
Brent Hoberman Brent Shawzin Hoberman (born 25 November 1968) is a British entrepreneur and investor. During the dot-com boom, he co-founded lastminute.com with Martha Lane Fox in 1998, where he was CEO from its inception, before selling the business to Sab ...
, founder of Lastminute.com and Founders Forum *
Gus O'Donnell Augustine Thomas O'Donnell, Baron O'Donnell, (born 1 October 1952) is a former British senior civil servant and economist, who between 2005 and 2011 (under three Prime Ministers) served as the Cabinet Secretary, the highest official in the Bri ...
, chairman of
Frontier Economics Frontier Economics (Frontier) is a microeconomics consultancy providing economics advice to public and private sector clients on matters of competition policy, public policy, regulation, commercial strategy, behavioural economics and energy and c ...
, former Cabinet Secretary *
Ed Vaizey Edward Henry Butler Vaizey, Baron Vaizey of Didcot, (born 5 June 1968) is a British politician, media columnist, political commentator and barrister who was Minister for Culture, Communications and Creative Industries from 2010 to 2016. A memb ...
,
Member of Parliament A member of parliament (MP) is the representative in parliament of the people who live in their electoral district. In many countries with bicameral parliaments, this term refers only to members of the lower house since upper house members of ...
and former
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*
Mikhail Fridman Mikhail Maratovich Fridman (also transliterated Mikhail Friedman; russian: Михаил Маратович Фридман; he, מיכאיל פרידמן; born 21 April 1964) is a Ukrainian-born, Russian–Israeli businessman, billionaire, and ...
, co-founder of
LetterOne LetterOne Holdings S.A. (LetterOne) is an international investment business based in Luxembourg. Its investments are focused on the Telecommunication, telecoms, technology and Energy industry, energy sectors through its two main business units, ...
The winners of the inaugural Indigo Prize were announced on 25 October 2017. A joint first prize, £125,000 to be equally split, was awarded to two teams of writers:
Diane Coyle Diane Coyle (born February 1961) is an economist and a former advisor to the UK Treasury. She was vice-chairman of the BBC Trust, the governing body of the British Broadcasting Corporation, and was a member of the UK Competition Commission fro ...
and Benjamin Mitra-Kahn; and
Jonathan Haskel Jonathan Haskel (born 13 August 1963) is a British economist, and professor of economics at Imperial College Business School. Haskel currently serves as board member of the UK Statistics Authority, a member of the Bank of England's Monetary Po ...
,
Carol Corrado Carol A. Corrado is an American economist who was the former chief of industrial output at the Federal Reserve Board and currently serves as a senior advisor and research director in economics on The Conference Board. She serves as a member of th ...
, ''et al.''"Indigo Prize Winners 2017"
''Global Perspectives''. Retrieved 25 October 2017.
A third place "Rising star" award of £10,000 was given to Alice Lassman. Coyle was professor of economics at the
University of Manchester , mottoeng = Knowledge, Wisdom, Humanity , established = 2004 – University of Manchester Predecessor institutions: 1956 – UMIST (as university college; university 1994) 1904 – Victoria University of Manchester 1880 – Victoria Univer ...
, and Mitra-Kahn is chief economist at
IP Australia IP Australia is an agency of the Department of Industry, Innovation and Science. IP Australia administers intellectual property rights and legislation relating to patents, trade marks, registered designs and plant breeder's rights in Australia. ...
. They proposed radically replacing GDP with a dashboard measuring six key assets: physical assets,
natural capital Natural capital is the world's stock of natural resources, which includes geology, soils, air, water and all living organisms. Some natural capital assets provide people with free goods and services, often called ecosystem services. All of t ...
, human capital, intellectual property, social and institutional capital, and net financial capital.Smith, Rebecca
"Winners announced of economics prize to give GDP a radical shake-up"
''
City A.M. ''City A.M.'' is a freesheet, free business-focused newspaper distributed in and around London, England, with an accompanying website. Its certified distribution was 85,738 copies a day in February 2020, according to statistics compiled by the A ...
'' 25 October 2017.
Isaac, Anna
"First winners of Indigo Prize in economics given £135,000 for re-imagining GDP"
''
The Telegraph ''The Telegraph'', ''Daily Telegraph'', ''Sunday Telegraph'' and other variant names are popular names for newspapers. Newspapers with these titles include: Australia * ''The Telegraph'' (Adelaide), a newspaper in Adelaide, South Australia, publ ...
''. 25 October 2017.
"Beyond GDP – Cambridge research project explores new measures for the 21st century economy"
Bennett Institute for Public Policy,
Cambridge University , mottoeng = Literal: From here, light and sacred draughts. Non literal: From this place, we gain enlightenment and precious knowledge. , established = , other_name = The Chancellor, Masters and Schola ...
. 8 January 2019.
Their essay stated that "GDP never pretended to be a measure of economic welfare", and proposed that the new measure should assess "the range of assets needed to maximise individuals' capabilities to lead the life they would like to lead"; this would include "financial and physical capital but also natural and intangible capital". They asserted that the new statistics should focus on measuring changes in the stock of important assets, rather than flows of income, expenditure, and output.Tetlow, Gemma
"Leading UK academics have suggested a radical overhaul of existing national statistics"
''
Financial Times The ''Financial Times'' (''FT'') is a British daily newspaper printed in broadsheet and published digitally that focuses on business and economic current affairs. Based in London, England, the paper is owned by a Japanese holding company, Nik ...
''. 25 October 2017.
Tracking the evolution of stocks of physical assets, financial assets and liabilities, natural capital, skill levels, and implicit state liabilities would better measure the sustainability of the economy. Coyle and Mitra-Kahn also proposed interim improvements to GDP measurements – such as better measurement of intangibles, adjusting for the distribution of income, and removing unproductive financial activity – before scrapping it entirely. Coyle, Diane
"The measurement that holds economic statistics back from reality"
''
Financial Times The ''Financial Times'' (''FT'') is a British daily newspaper printed in broadsheet and published digitally that focuses on business and economic current affairs. Based in London, England, the paper is owned by a Japanese holding company, Nik ...
''. 15 November 2017.
Following her prize-winning essay, Coyle now leads the Six Capitals research project, funded by LetterOne, at the Bennett Institute for Public Policy at
Cambridge University , mottoeng = Literal: From here, light and sacred draughts. Non literal: From this place, we gain enlightenment and precious knowledge. , established = , other_name = The Chancellor, Masters and Schola ...
; the project was inaugurated in January 2019 and explores social and natural capital. Haskel is professor of economics at
Imperial College Business School Imperial College Business School is the graduate business school of Imperial College London in the UK. In 2004, the business school was opened by Queen Elizabeth II. History In 1851, the Great Exhibition was the first World's Fair, organized by ...
. Rather than abandoning GDP, he proposed refining, updating, and extending the existing GDP measure. He proposed better measurement of services and intangibles, and direct measurement of the economic welfare being created by digital goods. His essay focused on the fact that economies have dramatically changed structure since GDP was originally developed, with more knowledge production, more digital goods, more free things and free information, and more intangible assets such as intellectual property."Haskel wins £125,000 economics prize"
''
The Jewish Chronicle ''The'' () is a grammatical Article (grammar), article in English language, English, denoting persons or things already mentioned, under discussion, implied or otherwise presumed familiar to listeners, readers, or speakers. It is the definite ...
''. 25 October 2017.
He also emphasized the importance of factoring in the environment, sustainability, and societal welfare, in addition to calculating the value of goods and services that are provided for free.Singleton, Laura
"Imperial professor awarded prize for new approach to measuring the economy"
Imperial College London Imperial College London (legally Imperial College of Science, Technology and Medicine) is a public research university in London, United Kingdom. Its history began with Prince Albert, consort of Queen Victoria, who developed his vision for a cu ...
. 25 October 2017.
Lassman, the recipient of the "Rising star" award, was a 19-year-old geography student at
Durham University , mottoeng = Her foundations are upon the holy hills (Psalm 87:1) , established = (university status) , type = Public , academic_staff = 1,830 (2020) , administrative_staff = 2,640 (2018/19) , chancellor = Sir Thomas Allen , vice_chan ...
. Her entry proposed a "Global Integration and Individual Potential" index, which measures each nation on two levels: its value relative to other nations, and the individuals and their contributions within each nation.Lassman, Alice
"Indigo Prize Entry"
Retrieved 25 October 2017.


References

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External links


The Indigo Era
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