“The question we have to ask ourselves is — are we moving in the right direction, is there a better way, could we at least try and make sure that we don’t impose costs on each other as we try and come out of our own difficulties?” — Raghuram Rajan, Ex-Governor, Reserve Bank of India
Most modern issues have economic underpinnings. Therefore, understanding macro economics has never been more vital. This article provides readers with frameworks to analyze the changes sweeping the globe and ultimately affecting us all. For instance, a slowing global economy has wider ramifications than just a slowdown in consumption. It also creates an environment where wealth inequality often widens resulting in social turmoil and where disruptive technologies become necessary. While social turmoil is a symptom, the deeper malaise is unequal distribution of economic profits which in turn is a direct result of our economic choices.
This article recommends looking at most changes through the lens of macroeconomics. Technologies such as Artificial Intelligence in it’s current form (i.e. Robotic Process Automation and Machine Learning), Distributed Ledger Technology and Cryptocurrencies occupy a greater share of our consciousness in an era of secular stagnation. Because, we are collectively seeking a better life for us and our children. Its as much a story of human solutions to human problems as it is a technological one.
While there are pockets of growth within the world economy such as India, the overall estimate for the global economy in 2018 is either maintaining a status quo or slow growth which has direct implications on our lives.
1. What is Economics?
While there are many technical definitions of Economics, I want to shy away from complexity. In simple terms, economics is the study of scarcity and choice because resources are limited and choices are not.