Economic policy, growth, and human flourishing

- economics research

What do scientific innovation, economic policy, GDP, employment, and entrepreneurship have to do with increasing flourishing at scale?

I’ve put a pin in this project for now, and I’m parking my observations, questions for further research and brief summaries of some key readings here.


I noticed two schools of thought emerge from my research.

The first, Camp Progress, is intensely considered with raising living standards, and supporting a talented elite driving this forward for all of society.

Take Tyler Cowen and Patrick Collison’s definition of progress: “By “progress,” we mean the combination of economic, technological, scientific, cultural, and organizational advancement that has transformed our lives and raised standards of living over the past couple of centuries.”

Camp Progress includes: Tyler Cowen, Patrick Collison, Peter Thiel, Benjamin Friedman, Progress Studies.

The second, which I’ll call American Compass, considers a broader definition of progress. Interests include raising the number of meaningful individual earners and producers, and leveraging economic policy in support of community and social fabric, at the expense of solving directly for GDP. Elites cling onto their places on an island that’s shrinking, and have given up on dignity, honor and courage as core values.

Camp Compass includes: Oren Cass, Andrew Yang, Henry George, Matthew Stewart, Tanner Greer, Angelo Codevilla, Chris Arnade, Venkatesh Rao.

It seems to me that the Progress Studies camp pays little mind to the flourishing of the median individual. But living standards are a component of flourishing, not the whole. What impact do rising living standards - and a policy regime solving for them - have to do with capacity of the median individual to be meaningful creators and adventurers in and of their lives? I’m not seeing it.

A sub-bullet of the above that occurred to me is that the study of economics does not (and cannot) solve for adventure or confidence in life as values for the every day person, the way you might see amongst old-school adventure types like you see in fiction, or my old math teacher! Qualities like adventure and confidence operate independently of living standards. A culture or society that solves for living standards squashes capacities for adventure and confidence. I think it also squashes the foundations for community and relationship - that’s another story.

Progress studies: We have a living standards problem. Look at this chart! Housing, childcare, education! That’s what’s getting in the way of more flourishing.

American Compass: We’re past the point where growing the top line and increasing living standards will make a difference for those that are struggling. The issue is that we’ve suffocated the ability of the median person to earn for themselves, their families and communities. And lost sight of what those living standards are actually for.

Future Questions

Is what Oren Cass calls “economic piety” (policies oriented towards maximizing GDP + redistribution, versus facilitating the ability of the median worker to produce) actually the case? If so, has it really backfired? By what standard do we measure this? Could this work? Or do I agree that GDP growth and human flourishing gotten detached from each other, and we could do better solving for the latter with different policies?

To what extent is it true that the rich have pulled the ladder up behind them? If so, how did this work, concretely?

How extractive is the financial industry? What have been the reasons, costs and benefits of finance growing from 3% of the economy in 1950 to 10%+ today?

Employee ownership, B-corps, cooperatives, Patagonia, etc. Are these trivial or vanity projects? Do they rely too much on individual saintliness, or could we see norms, policies or incentives evolve to make these mainstream? Is it worth working to build a world where this is the norm? What would it take?

Automation. Is it a big deal, or not? And is Andrew Yang right that most of us are “servants to the tide of innovation and efficiency,” clinging onto our place in a shrinking island?

Can we make universal claims about what it means to flourish, strong enough that we can reasonably design federal economic policy around it? What does it means for an individual to flourish? What would those policies be?

What’s the deal with the social safety net status quo? Oren Cass argues it’s become too high, Angus Deaton argues it’s too low. What are its component parts (quantifying this seems to gets thorny, since you’re dealing with disparate federal agencies, not an integrated approach…healthcare, unemployment benefits, food stamps)?

Fact check: “Rich people own. The top 0.1 percent are 3 times as likely to make their income from owning a business vs a wage. Salaries don’t make people rich, equity does.” But, isn’t this only true for owners of mega-companies? See Great Escape.

Bibliography & Summaries

The Moral Consequences of Economic Growth, Benjamin Friedman

The Once and Future Worker, Oren Cass

The War on Normal People, Andrew Yang

The Origin of Wealth: The Radical Remaking of Economics and What it Means for Business and Society, Eric D. Beinhocker

Peter Thiel

How this All Happened, Morgan Housel

The 9.9%, Matthew Stewart