To be sustainable, growth must be inclusive

What do you understand by the expression "inclusive growth", the concept central to your latest podcasts?

Growth is inclusive when it narrows social inequalities in a country or a group of countries. It's a way of comparing the growth of developed and emerging countries. It's the outcome of a model that not only calls for redistribution policies to reduce social inequalities in the near term, but also calls for the long-term development of all types of personal talents and skills: inequality is reduced by participating in growth and creating economic value.

Is this approach new?

Inclusive growth is now regarded as a necessity, considering that a model that does not take inclusion into account is doomed to failure.

Does the increase in social inequality make inclusive growth a necessity?  

Many macroeconomic statistics show that social inequalities are increasing. The proportion of earnings accruing to labour, i.e., wages and salaries, has been dropping for years. Most people rely on their wages for a living, and have little or no investment income, while financial risk-taking is rewarded better, witness the staggering performance of Wall Street.

Are there other destabilising factors?

Climate change is also a key factor that affects emerging countries first, as agriculture is structurally important for their economy. Their productivity is particularly affected by drought and floods, reducing the country's investment capacity, adversely impacting growth and productivity. It is essential to incorporate such disparities between countries when drafting development assistance policies in order to make emerging countries more resilient.

How do governments perceive the need for inclusive economic growth?

More and more countries are taking the concept of inclusion into account. I can cite Australia, Italy, the Netherlands, Scotland, Sweden... in France, the Law of 13 April 2015 requires the government, in its annual report, to present economic, social and environmental indicators, as well as wellbeing indicators. Legislation is taking the lead to promote awareness and change behaviours.

Which countries are the most progressive in this respect?

Norway, Iceland, Luxembourg, Switzerland, Denmark, Sweden, the Netherlands, Ireland, Australia, and Austria lead the pack in the annual report by the Davos World Economic Forum. These results take growth and development indicators into account – including per capita GDP, productivity, jobless rate, life expectancy, as well as inclusion criteria such as median household income, income inequality, poverty rate, and public sector debt, which should not burden future generations.

In your podcasts, you outline eight ways that governments could develop inclusive growth. Presumably, they can't all be driven simultaneously. What would be the first milestone?

To my mind, there are two priorities. First, protecting people from the harmful effects of losing jobs by providing financial, retraining and other support, which are the main factors in being able to find a new job by demonstrating your talent. Then, education: education is crucial to supporting the development of a society. You have to offer to as many people as possible good basic training and continue to grow their skills throughout their professional career so they can seize new opportunities. 

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