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Creating new economies & inclusive societies

New economies & inclusive societies. Insights from a TRANSIT Research-to-Policy Seminar

We are living in turbulent times with economic, ecological and social challenges, and significant political turmoil. In recent months, there has been a burst of public debates on the increasing divides in society, manifested in intercultural tensions, anti-elitist sentiments and ‘post-truth’ media wars around ‘alternative facts’. More than ever, there seems to be a need for researchers and policy-makers to exchange ideas on how to respond to such societal developments. As social science researchers, we make no illusions of having ready-made solutions or final answers to these political challenges. We do, however, argue that basic socio-economic needs and concerns underlie much of the current political and societal unrest.

This is why last week, on Wednesday the 15th of March 2017, researchers from the TRANSIT-project organized a research to policy lunch seminar at the European Commission in Brussels to exchange insights on what we can learn from social innovation research on how to create a more solidary and inclusive economy.

New Economy initiatives

In the TRANSIT project we study initiatives that are working on socially innovative responses to societal challenges. In total, we study 20 transnational networks and 80 local initiatives across more than 28 countries (in Europe and beyond). Almost all of these case studies argue for the need for new economies and alternative socio-economic arrangements. s. In our research, we identified four clusters of new economies: (1) social entrepreneurship & social economy, (2) green economy through degrowth & localization, (3) collaborative & sharing economy and (4) solidarity economy. Each of the clusters comes with a specific narrative of change, indicating what needs to change, who holds the power to do so and how that change comes about. What all these new economies have in common is that changing social relations is central to the transformation and that there is a need for a re-appreciation of certain relational values (e.g. trust, reciprocity, transparence, etc.).  

During this research-to-policy seminar, we presented an overall overview of the research insights so far (see presentation here: TSI_Intro_Flor_Avelino), and then we zoomed in on three concrete examples of the solidarity economy cluster: Basic IncomeParticipatory Budgeting and Time Banks. TRANSIT researchers distilled their insights on what kind of innovative economy arrangements these networks are envisioning and practicing, what the potentials and challenges of such arrangements are, and how they position around institutions at different levels.

Basic Income

Bonno Pel introduced the case of Basic Income (see presentation here: Basic_Income_Bonno_Pel), which gained a lot of attention recently. Basic income can be considered socially innovative and transformative as it restructures the ‘workfare’ bureaucracy, changes the relation between unemployed and the government, rebalances earning-caring and it changes the relations between unemployed, society and the market. It also changes gender relations/dependence on male breadwinner and it challenges meritocracy: who/what earns income. Basic Income reminds society that lots of added value is produced in collaboration with technology and other resources that are developed by earlier generations. Basic Income is an example that needs institutionalization in order to have impact. It is a public innovation and welfare reform at the same time and as such differs from other cases in TRANSIT. Bonno Pel argues that Basic Income is already institutionalized in some ways as there is a body of knowledge and whole discourse in both government and academia. According to Bonno Pel and Julia Backhaus (see working paper here) the future of Basic Income depends not on a board of experts but on the interplay between scientific and political authority.

Participatory Budgeting

Participatory budgeting was presented by Julia Wittmayer (see presentation here: Participatory_Budgeting_Julia_Wittmayer) and explained as a decision making process in which citizens think along, asses, negotiate and/or decide on the use and distribution of public money. It challenges and innovates the relation between citizens and policy makers, civils servants and representatives. As it has many different forms all over the world, ranging from budget responsibility to providing advice or controlling budgets and more, the potential to translate into real power or real money for citizens differs per case. It does however foster participation of citizens in public tasks and is therefore heralded by the international network OIPD as one form of a participatory democracy. In the case of Amsterdam (in a neighborhood called Indische Buurt), since 2012 yearly trainings on budgetmonitoring are organized to learn how to read and influence the public budget. Imported from Brazil, budgetmonitoring puts a human rights perspective central to address the gap between the commitment of government to the declaration of human rights and its actual representation in policy and budget. More recently and through an adaptation to the Dutch context, the focus has shifted to increasing civic participation. The local initiative did have some transformative impact on the role of the citizens and the role of policy makers as the municipality changed their internal ways of working for arriving at a local policy plan. Participatory budgeting is now integrated in the working practice of drawing up an area plan of the neighborhood, a formal administrative document. This example is closely related to the daily practices and routines of policy makers. This requires a change in their own understanding of their tasks and responsibilities. To live up to their transformative ambitions, this particular type of social innovation needs to consider the democratic quality of the process (who is in/excluded), the degree of power for citizens (controlling afterwards or right to decide) and the portion of the overall budget.

Time Banks

Paul Weaver introduced us to Time Banks (see presentation here: Timebanking_Paul_Weaver) member organized networks that exchanges services amongst themselves. The currency used for exchange is time: the hours spent giving and receiving services. It is a values- and principles- based system where people share and develop their capacities, talents and skills. Those are seen as assets. The principle is one of helping oneself by helping others. It is different from volunteering as it is expected that people both give and receive services. Time Banks mobilize underused and overlooked resources, especially the time and talents of people, spare capacities and wasted land and materials. Time banking makes it possible to valorize and share those resources. There is a high social return with little upfront financial investment and anyone can participate in and benefit from service exchanges. Time Bank proponents argue that society now lacks important elements of infrastructure that are needed to support strong, resilient and more self-sufficient communities, to provide inclusive opportunities for economic and social participation, and to support active and healthy lifestyles. Time banks therefore seek to build secondary economies that can help people and communities meet some of their needs and reduce the incidence of problems that come from exclusion and inactivity. In the UK we find examples of time bank activities enhancing employability, providing support for care for home residents, helping assimilate refugees and addressing urban poverty. The transformative potential of time banks is many faceted: redefining work, how time is used, how income is allocated and how social security is achieved. Time Banks can help change ideas about rights, responsibilities and roles in society. They offer new approaches to inclusion. Time Banks nevertheless struggle to sustain their activities without some secure financial support or help in developing their own capacities to develop income streams. Universities can help Time Banks demonstrate their social impact. Financial and policy innovation can help create opportunities for Time Banks generate own income streams. 

Social innovation beyond the dichotomy between government and civil society

Important takeaways from the lunch seminar is that the origin of social innovation is very diverse and can come from any sector: government, market, civil society and/or science. . In the cases of Basic Income, Participatory Budgeting and Time Banking, we see how co-creation and interaction between the sectors is crucial. New social relations are shaped outside, from within or in parallel to existing institutions.  While the idea of timebanking was born in the context of civil society, the concept of participatory budgeting was actually initiated from within local government institutions. As such, social innovation is not about a simple opposition between civil society and government institutions, or between old and new, but rather about a dialectic interplay between and across different actors and institutional logics.  

The Challenges of Social Innovation

Lots of social innovations have a long history. We see that they come up in certain periods and are reinvented in other periods. Some are here to stay and some will disappear again. We see social innovations responding to economic exclusions, climate change, aging, migration and other large societal challenges that seem not to be adequately addressed by existing government policies. Central to this seminar was of course the question what international government institutions, such as the European Union, can do to support social innovation? Some preliminary policy recommendations were shared: financial innovation and policy innovation can facilitate social innovation in addressing societal challenges; public services that are being outsourced can be taken up by social innovation organizations if they are included in public procurement procedures, this provides them with new earning opportunities that helps them sustain; building secondary infrastructures is critical to experiment and give room to values and practices that offer an alternative narrative, like rethinking the idea of full employment in a context of lacking opportunities in the mainstream economy. Nevertheless, also new concerns raised. For instance, how to regulate ‘the social innovation sector’ that is not (yet) a sector? While on the one hand social innovations show us that alternatives are possible, on the other hand perverse incentives can also serve just those with specific interests.  Are social innovation initiatives really offering solutions to persistent problems or are they mostly being used as a Band-Aid?  ‘Such paradoxes of transformative social innovation are at the heart of the TRANSIT research project.  

Further reading:

This article was first published on the TRANSIT website here.