There is a world of innovation and entrepreneurism where the bottom line is the last thing that matters. René Kemp tells.
We live in a world of marketisation with its foundations in the commoditisation of land, labour and money (Polanyi, 2001). Built on top of that are new public management, performance-based pay; contracting out; and the spread of market thinking in personal domains of life. According to Michael Sandel, marketisation is, “the process where market values reach into every sphere of life, everything from family life in personal relations, to health, education, civic life, and civic duties”. 
Marketisation is praised for achieving greater efficiency but comes with costs to wellbeing. Competition in the market place drives organisations to short product cycles through planned obsolescence with little regard of the wellbeing of workers and nature. It is found to turn people into individuals, as workers and consumers, competing with each other (Sennett, 1998, 2006; Verhaeghe, 2015). When success is viewed as an individual achievement, lack of success in finding a job and keeping it and the conspicuous consumption that goes with it, becomes a personal failure. In a blog titled Good for nothing, Mark Fischer notes that: “A particularly vicious double bind is imposed on the long-term unemployed in the UK now: a population that has all its life been sent the message that it is good for nothing is simultaneously told that it can do anything it wants to do.”
But an alternative economy is emerging – partly in response to marketisation – that is more local and ecologically minded and that comes with an important role for cooperation and purposeful activities that address basic psychological needs for autonomy, relatedness and competence. In the local economy, it takes the form of community-interest organisations, time banks and local currencies. In the market economy it takes the form of ethical investments and so-called Teal organisations (Laloux, 2014). It is based on a project called Transit, in which 100 local manifestations of social innovation belonging to 20 network organisations were studied.
For a macro-economist, there is only one economy, with official sectors captured by the System of National Accounts. But next to the national economy, there are local economies, community-interest organisations involved in economic activities, social enterprises and Teal organisations that rely on self-management and work that has meaning and purpose.
“An alternative economy is emerging – partly in response to marketisation – that is more local and ecologically minded and that comes with an important role for cooperation and purposeful activities that address basic psychological needs for autonomy, relatedness and competence.”
Alternative economy initiatives include:
- timebanks where people provide their work – measured only by the time taken – in exchange for the work of others;
- slow food convivia – agricultural organisations governed by the quality of their produce as well as its environmental impact and fairness of wages;
- transition towns – community projects that aim to reduce the impacts of climate change and economic instability; and
- eco-villages that seek to regenerate social and natural environments.
Different actors with diverse motivations are involved in such initiatives including volunteers, paid professionals, local government, charities, scientists, social movement organizations and journalists.
In the Transit project such initiatives are viewed as social innovation initiatives (SII) because the relations on which they are based are unusual in terms of today’s society. There is often no manager, assets are frequently collectively owned and decision-making is consensual and inclusive.
In non-profit social change promoter, Ashoka, business thinking is used for achieving social impact but most initiatives rely on an asset model in which everyone’s assets are valued and utilised. It operates on the basis of values expressed in its mission statements. Slow Food, a network of 100,000 members in 160 countries, is “committed to protecting traditional and sustainable quality foods, conserving cultivation and processing methods, and defending the biodiversity of cultivated and wild varieties”. It envisions “a world in which all people can enjoy food that is good for them, good for producers and good for the planet”.
“It addresses human needs that are badly catered for in efficiency-oriented businesses that treat people as expendable.”
For the people involved in the social innovation activities studied in Transit, the social relationship is desired as something they value or want to experiment with. In different ways and to different degrees such initiatives cater for people’s need for: autonomy, social bonds and meaningful relationships with others as well as their desires to engage in meaningful activity and contribute to a world that is more equal, fair and respectful of people and nature.
The many motivations behind the SIIs and contextual circumstances require further analysis. But the few attempts to look at these relationships in social innovations have found that members of initiatives instinctively understood the value of autonomy, relatedness and competence and took steps to provide these experiences to others (Reznickova & Zepeda, 2016). It addresses human needs that are badly catered for in efficiency-oriented businesses that treat people as expendable.
Compared to the initiatives of the 1970s and traditional forms of community, SIIs appear to offer a greater role for self-actualisation and a greater role for entrepreneurship. It is not a political movement in the traditional meaning of the word but a directional process. The movement consists of disparate initiatives which are not politically united and may never become so. Given its rootedness in self-chosen communities and its orientation to the local economy, it might be called the localisation and humanisation movement.
In connection to related cases, Paul Mason speaks of “Post-Capitalism” and Restakis and Bauwens of the “commons transition”. I prefer “humanisation of the economy” as an umbrella term for activities of living and working based on values of reciprocity, responsible citizenship, personal integrity and autonomy and connectedness with an important role for serving higher purposes than personal gain. Humanisation is more fitting because humans have basic needs for autonomy, relatedness and competence (Sheldon and Ryan, 2011), something that has been extensively documented in cross-cultural research (Chen et al., 2013).
“Competition in the market place drives organisations to short product cycles through planned obsolescence with little regard of the wellbeing of workers and nature.”
The humanisation of the economy is partly a reaction to marketisation and phenomena related to it including ecological degradation, managerialism and working solely for money. It is also, in part, something that people instinctively understand: making the best use of skills, doing work that is meaningful and fulfilling and living a good life with an important role for non-material needs. Elements of the alternative economy such as self-management are entering the commercial economy and tenets of the normal economy like entrepreneurship and innovation are entering the alternative economy. The convergence is likely to encounter limits since they are based on different logics. As any development, the alternative economy will experience twists and turns, but the motivations on which it is based are basic psychological needs, not those of a special class of people.
“A particularly vicious double bind is imposed on the long-term unemployed in the UK now: a population that has all its life been sent the message that it is good for nothing is simultaneously told that it can do anything it wants to do.”
Social innovations are today of great interest because they hold answers to key challenges that our societies currently face such as providing opportunities for meaningful work, fostering social inclusion and cohesion, offering care in different ways and empowering science and citizenry in addressing societal challenges. Social innovation is important for a post-growth world that is more human. Its growth will depend on people becoming aware of non-material needs and alternative economy opportunities and getting out of the work and spend cycle (Schor, 2010). It is a sign of hope in a world of worker anxiety, polarisation and uprooting. It has even been referred to as the Great Transition (http://www.smart-csos.org/ ) to deal with the great transformation of our time (Polanyi, 2001).
 JP O’Malley, 2013, Michael Sandel interview: the marketisation of everything is undermining democracy, The Spectator https://blogs.spectator.co.uk/2013/05/michael-sandel-interview-the-marketization-of-everything-is-undermining-democracy/
 Mark Fisher, 2014, Good for Nothing https://theoccupiedtimes.org/?p=12841
 The article is based on a longer paper called the humanisation of the economy through social innovation (Kemp et al., 2016). It draws on the contributions of my co-authors.
Bauwens in “Commons Transition. Policy proposals for an open knowledge commons society”. http://commonstransition.org/wp-content/uploads/2014/11/Commons-Transition_-Policy-Proposals-for-a-P2P-Foundation.pdf
Chen, B., Vansteenkiste, M., Beyers, W., Soenens, B., & Van Petegem, S. (2013). Autonomy in family decision-making among Chinese adolescents: Disentangling the dual meaning of autonomy, Journal of Cross-Cultural Psychology. Advance Online Publication. doi:10.1177/0022022113480038
Kasser, T. (2002). The high price of materialism. Cambridge, MA: MIT Press.
Kemp, R., Strasser, T., Davidson, D., Avelino, F., Pel, B., Dumitru, A, Kunze, I., Backhaus, J., O’Riordan, T., Haxeltine, A., and Weaver, P.W. (2016). The humanization of the economy through social innovation, paper for SPRU 50th anniversary conference and IST2016 conference.
Laloux, F. (2014) Reinventing Organizations. A Guide to Creating Organizations Inspired by the Next Stage of Human Consciousness, Nelson Parker.
Mason, P. (2015) PostCapitalism. A Guide to our Future, Allen Lane.
Polanyi, K. (2001). The Great Transformation: The Political and Economic Origins of Our Time, 2nd ed. Foreword by Joseph E. Stiglitz; introduction by Fred Block. Boston: Beacon Press. (the book was originally published in 1944)
Reznickova, A. and Zepeda, L. (2016) Can self-determination theory explain the self-perpetuation of social innovations? A case study of Slow Food at the University of Wisconsin-Madison. Journal of Community and Applied Social Psychology, 26, 3-17;
Sandel, M.J., (2012) What Money Can’t Buy: The Moral Limits of Markets, Farrar, Straus and Giroux.
Sandel, M., What Money Can’t Buy: The Skyboxification of American Life http://www.huffingtonpost.com/michael-sandel/what-money-cant-buy_b_1442128.html
Schor, J.B., (2010) Plenitude: The New Economics of True Wealth, Penguin books
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Sennett, R. (2006). The Culture of the New Capitalism, Yale University Press, New Haven & London.
Verhaeghe, P. (2015) What About Me?: The Struggle for Identity in a Market-Based Society, Scribe Publications.