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Our system is broken. A cooperative economy can offer a long-term fix – I by IMD March 2024 Issue

In my lockdown isolation in northern Italy, against the devastating backdrop of COVID-19, I took some time off to sit down and revisit the frameworks I have been teaching my MBA and executive students for a couple of decades. How come? Well, in a world facing growing inequality, the dominance of a few major platforms, ineffective economic policy and regulation, the exhaustion of natural resources, social unrest, and the unprecedented economic impact of the pandemic, I became increasingly convinced that our economic system was broken and no longer fit for purpose. Despite any benign intentions, it had become an entrenched framework that made it possible for a few opportunistic, well-informed actors – best illustrated by the Big Tech companies and their platforms – to game the system at the expense of the well-being and prosperity of everyone else, with dire consequences for our planet and our society. I wanted to think about how business school professors like me could train future leaders to build a global economy that better served the needs of our society and the generations to come. This led to further reflections about what that economy should look like and how it would function. Research tells us that most people are, by nature, prosocial rather than opportunistic, so how did we get to the point where our economic system so heavily favors the opportunism of a few over cooperation in communities and our society at large? After a period of exploration, my prognosis was rather pessimistic for those who believe we just need to tweak or amend our existing economic system to fix things. In my book, The Cooperative Economy, I identify five grand challenges the current economic system has enabled and explain why that system cannot be reformed. In this article, I explore those five challenges and propose a vision for a new, platform-based economic system. I discuss how this system might work in practice and how we could address any pitfalls in its execution. To read the article visit I by IMD Issue 13 article