Achieving Sustained, Indigenous and Inclusive Growth (The Allama Iqbal Lecture)

The world economy is now facing paramount problems such aslong tern stagnation of economic growth and worsening incomedistributions (or economic polarisation). This is even moreembarrassing, because the humans have been seeking more equal societyduring the post-WWII era by engaging in the revised capitalism or socialdemocracy by the most of capitalist developed economies, the balancedgrowth strategies under social democracy by most of the developingeconomies and more dramatically the socialist economic regime by thealready collapsed socialist blocs, not to mention the still barelysurviving North Korea. “Growth stagnation and economic polarisation” isnot the one which has been intended and anticipated by policies but isopposite to intention as well as expectations. Some of the critics oncapitalist economy have been arguing that this is the outcome of thefundamental contradiction of the capitalist economy from the Marxianperspective and/or the result of the neoliberal policies since the 1980s[Piketty (2014) and Stiglitz (2012)]. However, if one understands thatthe neoliberalism had short-lived only during the Thatcher-Reagan era,of course with some lingering effects, this episode can be seen as atyphoon within the tea cup. In this regard, broadly speaking, the commonunderlying institutions of post-war politicaleconomy regime of the worldeconomy can properly be called as the economic equalityseeking“egalitarian democracy” which includes the revised capitalism and socialdemocracy, not to mention the socialism. Therefore, one can see that theefforts to create more economically equal society or in other words, theshared growth have in fact created more unequal as well asgrowth-stagnated economies against the intention as well as expectation.This seems to be the fundamental dilemma faced now by the worldeconomies and these are perhaps waiting for the economic as well as anyother social science profession to come up with a solution to it. Ofcourse, some naive Marxists or leftist economists would claim that thisphenomenon of the worsening income inequality is simply the fact of thecapitalist economy