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Our Rationale
The UCL Centre for New Economic Transitions (CNET) brings together leading economists, political scientists, sociologists, and historians to shed new light on the deep causes and future trajectories of the significant transitions taking place in modern economies. The Centre’s research directions focus on four structural transitions: socio-economic, technological, institutional, and environmental.
The mounting levels of income and wealth inequality within nation-states have brought the issue of income distribution “back from the cold” after a long period of neglect in academic and public debates. The global income distribution is, however, increasingly more equal as the global middle class is gaining momentum. The stark separation between wealthy “capitalists” and poor “workers” that has accurately described societies for centuries fails to depict the world we currently live in. As individuals earn from multiple sources of income nowadays, the concept of socio-economic class needs to be redefined. Accordingly, new cleavages are emerging, reflecting differences in identities and beliefs. Understanding the rise of new marginalised groups, as well as their access to opportunity, deserves greater attention. These stylized facts lay the foundations for a socio-economic transition which has no precedent in the history of society.
The digital revolution is at the heart of a new technological age that is shaping business dynamics, market structures, and the very future of work. To halt the dominance of monopolistic superstar firms and to ensure that automation increases skills and enriches work experience, social scientists need to think about how to make this technological transition as smooth as possible. Striking the right balance between state intervention and market deregulation is at the core of such debate. At the same time, while new technologies are displacing old manufacturing jobs in the developed countries, globalization is driving employment and growth in the developing world.
The changing structure of political cleavages around the world urges us to rethink how politics and economics interact and evolve across time and space. The recent rise of populist movements and democratic backsliding in many developed nations is only one example of these structural transformations. Such changing nature in the political landscape question the actual individuals’ perceptions of the gains from accelerated economic and financial integration (read un-restrained globalization), and economic and financial reforms more broadly, in both emerging and advanced economies. In particular, European integration is under threat, due to European sovereign debt crisis, Eurosceptic developments such as Brexit, and to democratic backsliding in some Central and Eastern European member countries. Regional divides (based on differences in tangible endowments but also in identities and values), both within and between countries, and migration dynamics are some of the driving forces behind this modern political, or more broadly defined, institutional transition.
A sustainability transition acknowledges that resources are finite and should be used for human well-being. To this end, having a long-term perspective in managing these scarce resources is imperative. Economic, social, and environmental challenges are different facets of the same sustainability challenge. Also, while the rise of digital technology has led to the modernization of organizational structures and processes, there is another side of digitalization which often remains overlooked: the increasing reliance on massive data centres and computing power consumption, altogether leading to the rise in consumption of natural resources and energy and higher waste. Understanding the balance between economic and environmental impacts of digital technologies is critical for ensuring sustainable development. Moreover, social scientists need to conceptualize new growth regimes which depart from the fossil-based economy, and which include sustainability as the new measure of performance and well-being.
With a long history of research on the transitions of post-socialist countries from planned to market economies, and within a new context where, to use Branko Milanovic’s words, capitalism is “alone”, but it comes in varieties, the UCL Centre for New Economic Transitions is in prime position to provide fresh perspectives on the new transitions currently in motion in modern capitalist economies and beyond. With a comparative approach, strong methodological, discipline and interdisciplinary based foundations and expertise, and a global scope, the Centre is a leading interdisciplinary research hub for the significant challenges of societies in the 21st Century.