Econintersect: Constantin Gurdgiev is a lecturer in Finance with Trinity College, Dublin, former editor of Business and Finance Magazine, and a regular contributor to Tonight With Vincent Browne on TV3 (Dublin). Constantin feels that global economy is shifting toward more human capital-intensive growth, driven by changing nature of entrepreneurship, creativity, and altering the relationship between risk taking, risk management and returns to labour. In this age of what he calls Human Capital, existent systems of political power distribution, taxation and public services will undergo a revolutionary transformation, presenting a major challenge to the advanced economies and their social democracies.
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Gurdgiev sees the future belonging to human creativity as machines increasingly displace humans from repetitive and optimization processes. His view is much different from those who bemoan the displacement of work by software and machines. He sees the growth of economic activity through finance, mechanization and new technology implementation declining – the new economy will have an increased dependence on human capital.
The future economy will require a growth of services that support human creativity and fewer that support finance, automation and the systems that have brought us through the last half century. Those traditional factors will be needed in less proportion and such things as education, policies and institutions that support the development and retention of creative human capital will be more important for growth. In the future “owners” of business will be less involved in “direction” of the enterprise and more in the “enabling” of creative human capital. Gurdgiev sees traditional vertical organization of business replaced by distributed, horizontal organizations. Economic growth will result from a competition of intellect rather than a completion of accounting control.
Econintersect: This view of the future is either prophetic or overly idealistic. But one thing we think after listening to the discussion presented, if not the future described by Gurdgiev then some other way must be found to “capitalize” on the potential of humanity. An age of soft and hard machines running a world for passive humans would result in a spiral of decay.
Constantin Gurdgiev is a contributor to GEI.
- Human capital & the age of change: Constantin Gurdgiev at TEDxDublin (YouTube, 13 November 2013)