Capitalism and Crises

Abstract

Abstract The world is encountering multiple crises—climate, droughts, floods, energy, food, and pandemics. This book is about how capitalism can fix them—how it can solve not cause them. The reason why it has caused them is that we have misconceived the nature of our capitalist system. We have failed to understand the key institution at the heart of it—business—and as a result we have allowed it to cause as well as solve problems. This book describes why this has happened and what needs to change to address it. It will demonstrate that at the core of the problem is the key driver of capitalism and that is profit—the way in which we resource and reward those who run the system. Currently, profit comes from causing as well as solving problems. It must not, if we are to prevent the problems. At the centre of the book is the notion of organizations as existing to solve problems, not cause them, and the way in which they should be designed, owned, governed, measured, and incentivized to do that. The book discusses how financial institutions should contribute to this, and how the public sector can work with the private on a common purpose of solving problems and creating shared prosperity.