Transforming Finance
RESPONDER Finance Workshop
Tim Jackson14th May 2013
Incomes
Factorflows
Spending
Goods &services
Firms People
Dimensions of the real and money economy
increasingproductivity
prices novelty
Consumer credit
Commercialcredit
creative destruction status competition
Investment Saving
Speculation
Conventional Finance• speculation
– commodities– property– derivatives
• consumer lending – mortgages– unsecured lending
• ‘real’ investment– short-term-ist– rent-seeking– chasing productivity bubbles– depleting resources– de-grading environments
Net lending by UK banks 1972 - 2013
Net lending by UK banks 1972 - 2013
Net lending by UK banks 1972 - 2013
Incomes
Factorflows
Spending
services
Firms People
Dimensions of the green economy
resource productivity
novelty
Affordable housingInvestment
loans
participationprosperity
Investment Saving
Speculation
• enterprise– resource light – employment rich– the ‘service’ economy
• employment– work-time – skill and service-oriented
• investment– ecological and social– a different ‘ecology’– slow, patient capital
• money– appropriate institutions– sector balances– green money supply
Dimensions of the green economy
• green technologies– renewables– energy efficiency– resource productivity
• infrastructure– public transport– low-carbon buildings– community spaces
• ecological protection – forests– soils and crops– wetlands and habitats
• services– health and education– care, craft and culture
A green investment portfolio
Accounting for Money
(S – I) = (G – T) + (X – M)
Private net savings
Public sector net borrowing
Overseas net borrowing
UK Sector Net Savings as % GDP
GovernmentHouseholdsCorporateRest of the World
• small-scale– peer-to-peer – community bonds– community banking
• institutional investors– governance– negative screening – investment for good– impact investment
• macro-economy– financial regulation– fiduciary duties– hypothecated transactions tax– green quantitative easing – sovereign spending– the chicago plan
Transforming Finance