Enhancing Organizational Performance through Effective Supply Chain Management Practices

In today’s dynamic and competitive business environment, organizations are constantly seeking ways to improve their overall performance and gain a competitive edge.

One area that has emerged as a critical determinant of success is supply chain management (SCM). Effective SCM practices can significantly impact the performance of an organization in various aspects, ranging from cost efficiency to customer satisfaction. In this article, we explore the profound influence of SCM practices on organizational performance and highlight key strategies for optimizing supply chain operations.

Supply chain management encompasses the coordination of activities involved in sourcing, procurement, production, logistics, and distribution of goods and services. It involves a network of suppliers, manufacturers, distributors, retailers, and customers, all working together to deliver value to end consumers. By implementing robust SCM practices, organizations can achieve numerous benefits that contribute to overall performance improvement.

One of the primary ways SCM practices enhance organizational performance is through cost reduction. Efficient supply chain processes minimize inventory holding costs, reduce transportation expenses, and optimize production scheduling. By streamlining these activities, organizations can lower their overall operating costs, thereby improving profitability and competitiveness in the market. Moreover, effective SCM practices enable better supplier management, negotiation of favourable terms, and strategic sourcing decisions, leading to cost savings across the supply chain.

Beyond cost reduction, SCM practices play a pivotal role in enhancing operational efficiency. By implementing technologies such as advanced analytics, artificial intelligence, and automation, organizations can optimize their supply chain processes, leading to faster response times, reduced lead times, and improved production cycle times. This heightened efficiency allows organizations to meet customer demands more promptly, minimize stockouts, and enhance overall productivity.

Furthermore, SCM practices directly impact the quality and consistency of products and services.

Through rigorous quality control measures and collaboration with reliable suppliers, organizations can ensure the delivery of high-quality goods that meet or exceed customer expectations. Consistency in product quality fosters customer satisfaction, strengthens brand reputation, and cultivates long-term customer loyalty, driving sustainable growth and profitability.

In addition to internal operational benefits, SCM practices contribute to better risk management and resilience within the organization. By establishing robust supplier relationships, diversifying sourcing channels, and implementing contingency plans, organizations can mitigate risks associated with supply chain disruptions, such as natural disasters, geopolitical events, or fluctuations in market demand. Proactive risk management strategies enable organizations to adapt swiftly to unforeseen challenges, minimize disruptions, and maintain continuity in their operations, thereby safeguarding their overall performance and reputation.

Moreover, effective SCM practices facilitate strategic decision-making and alignment with organizational goals. By providing real-time visibility into supply chain activities, data-driven insights, and performance metrics, organizations can make informed decisions regarding inventory levels, production capacities, and resource allocation. This strategic alignment ensures that supply chain initiatives are aligned with broader organizational objectives, such as market expansion, product innovation, or sustainability initiatives, driving holistic growth and value creation.

In conclusion, supply chain management practices have a profound impact on the overall performance of organizations across various dimensions. From cost reduction and operational efficiency to quality enhancement and risk mitigation, effective SCM practices are essential for achieving sustainable competitive advantage in today’s complex business landscape. By embracing innovation, collaboration, and continuous improvement, organizations can optimize their supply chain operations and unlock new opportunities for growth and success.


Harnessing the Power of Small Companies: Impacting Global Change

In the giant corporate world, small companies look like peripherals in an electronic device. However, the truth is that these seemingly insignificant entities possess the potential to make waves that ripple far beyond their immediate surroundings. From fostering innovation to driving sustainability initiatives, small companies play a crucial role in shaping the landscape of global change.


Embracing Innovation

Small companies are often nimble and adaptable, unencumbered by the bureaucratic red tape that can stifle creativity in larger organizations. This agility allows them to experiment with new ideas and technologies, pushing the boundaries of innovation in ways that larger firms may overlook.

Take, for example, the burgeoning field of clean energy. While major energy conglomerates may have the resources to invest in large-scale projects, it is often smaller, more specialized companies that lead the charge in developing breakthrough technologies such as solar panels or wind turbines. By driving innovation in renewable energy, these small companies not only contribute to the fight against climate change but also pave the way for a more sustainable future.

Key Benefits

  • Drives breakthrough technologies in various sectors.
  • Embraces emerging trends with agility and responsiveness.
  • Encounters fewer bureaucratic hurdles, enabling swift decision-making.
  • Encourages collaboration and cross-disciplinary approaches.
  • Explores niche opportunities often overlooked by larger firms.
  • Flexibility enables quick experimentation and iteration.
  • Nurtures an environment conducive to novel solutions.
  • Promotes a culture of continuous learning and improvement.
  • Rapid adaptation to market changes fosters competitiveness.
  • Sparks creativity through a culture of risk-taking.



Fostering Entrepreneurship

Small companies are often the breeding ground for entrepreneurship, providing individuals with the opportunity to pursue their passions and turn their ideas into reality. This spirit of entrepreneurship is a powerful force for driving economic growth and creating jobs, particularly in underserved communities.

Moreover, small businesses can serve as engines of social mobility, offering pathways to prosperity for individuals from diverse backgrounds. By empowering entrepreneurs to build their own businesses, small companies contribute to the development of vibrant and inclusive economies, both locally and globally.

Key Benefits

  • Amplifies opportunities for social mobility and wealth creation.
  • Cultivates innovation through freedom to explore new ventures.
  • Empowers individuals from diverse backgrounds for success.
  • Encourages risk-taking and initiative in business endeavors.
  • Fosters resilience and adaptability in the face of challenges.
  • Nurtures a supportive ecosystem for budding entrepreneurs.
  • Provides platforms for pursuing individual passions and ideas.
  • Serves as a catalyst for community development and empowerment.
  • Stimulates economic growth and job creation.
  • Strengthens local economies by fostering homegrown talent.


Championing Sustainability

In an era marked by growing environmental concerns, small companies are increasingly stepping up to the plate and embracing sustainable practices. Whether it’s reducing carbon emissions, minimizing waste, or sourcing ethically produced materials, these businesses recognize the importance of operating in harmony with the planet.

Through their commitment to sustainability, small companies not only reduce their own environmental footprint but also set an example for larger corporations to follow. By demonstrating that profitability and environmental responsibility are not mutually exclusive, these businesses are driving a paradigm shift in how we think about business practices.

Key Benefits

  • Aligns business objectives with long-term environmental goals.
  • Attracts environmentally conscious consumers and investors.
  • Creates resilience against climate change and resource depletion.
  • Drives innovation in eco-friendly products and services.
  • Enhances brand reputation and consumer trust.
  • Minimizes operational costs through efficient resource management.
  • Preserves ecosystems and biodiversity for future generations.
  • Reduces environmental impact through responsible practices.
  • Sets a precedent for corporate social responsibility.
  • Supports the transition towards a greener economy.


Leveraging Technology for Good

In today’s digital age, small companies have access to powerful tools and technologies that can amplify their impact on a global scale. From social media platforms to e-commerce marketplaces, these digital resources enable small businesses to reach customers and collaborators across borders, breaking down traditional barriers to entry.

Furthermore, technology can be a powerful enabler of social change, allowing small companies to leverage data analytics, artificial intelligence, and other cutting-edge tools to address pressing global challenges. Whether it’s improving healthcare access, advancing education, or promoting human rights, technology empowers small businesses to make a meaningful difference in the world.

Key Benefits

  • Catalyzes innovation through the integration of cutting-edge technologies.
  • Democratizes access to information and resources.
  • Empowers marginalized communities with access to digital tools.
  • Enables data-driven decision-making for social impact initiatives.
  • Enhances efficiency and productivity in business operations.
  • Enhances scalability and growth potential for small businesses.
  • Expands global reach and accessibility through digital platforms.
  • Facilitates collaboration and networking opportunities worldwide.
  • Improves customer engagement and satisfaction through digital solutions.
  • Strengthens transparency and accountability in business practices.



While small companies may lack the resources and influence of their larger counterparts, they possess a unique set of strengths that enable them to drive global change in ways that are innovative, entrepreneurial, and sustainable. By embracing innovation, fostering entrepreneurship, championing sustainability, and leveraging technology for good, small businesses are proving that size is no barrier to making a positive impact on the world.

As we look to the future, let us recognize the vital role that small companies play in shaping a more equitable, sustainable, and prosperous world. By supporting and empowering these businesses, we can unlock their full potential to drive meaningful change and create a brighter future for generations to come.

Choose the Best B2B Online Marketplace for Your Business!

Some research review that almost 60% of B2B buyers are open to purchasing products on digital marketplaces. A B2B platform enables B2B buyers to perform online transactions between global companies. With the support of the best online platform, you can create a set of special features tailored to your needs. Companies in the selling process based on a digital marketplace need higher levels of automation, advanced inventory management and order fulfillment options, and various sales and marketing tools. So here are some of the features that an effective B2B online platform should have.

Web design
Every web design is a representation of a brand’s character & personality. In a good B2B online marketplace, you will be able to build anything that can support you perform your sales process smoothly without the support of a web designer. With ready-to-go designs and layouts, it will allow you to design your profile with essential images, text, and colors to get selling faster. The followings are some of the benefits of good web design.

  • Clear and user-friendly interface
  • Clear call-to-action buttons and messaging
  • Consistent branding and visual design
  • Easy checkout process with minimal steps
  • Fast page loading speed
  • High-quality product images and descriptions
  • Intuitive navigation and search functionality
  • Flexibility to customize and build anything you would want to portray
  • Mobile-friendly and responsive design
  • Secure website with SSL encryption
  • Trust signals, such as customer reviews

Multiple payment options
B2B shoppers need to purchase large quantities of products on a regular basis. Hence, the best B2B online marketplace should have multiple payment options such as partial payment, paying one or several invoices at the same time, and a model of subscription payment. With the model of multiple payment options, your customers will have the ability to divide the costs for their orders into small sums of money. B2B ecommerce firms organize flexible payments nowadays that are advantageous and firms requires taking every advantage that they could get. With the best B2B platform, you can do the following.

  • Ability to accept PayPal payments
  • Ability to save payment information
  • Automated payment reminders and follow-ups
  • Automatic invoicing and receipts
  • Easy payment processing and checkout
  • Integration with popular payment gateways
  • Payment fraud protection and security
  • Support for alternative payment methods
  • Support for major credit cards
  • Transparent pricing and fees
  • With better data, there will be higher revenues

Marketing tools
During this digital age, a digital life-focused marketing tool is a key feature of any marketing strategy. With the best B2B marketplace platforms, companies can sell their products to global customers through the latest digital marketing tools. An effective B2B marketing can be challenging to execute. With creative demands, budget, and channel decisions, marketers have a lot of work to do in order to come up with an effective marketing strategy. The followings are some of the best marketing tools that a B2B marketplace should have.

  • A/B testing and optimization tools
  • Analytics and reporting for marketing campaigns
  • Automated email marketing campaigns
  • Content marketing and blogging capabilities
  • Integration with CRM and sales tools
  • Lead generation and customer acquisition tools
  • Personalization and segmentation capabilities
  • SEO optimization and search visibility
  • Social media integration and sharing options
  • Targeted advertising and retargeting options

Companies that sell physical products need to adopt a good B2B platform that has good shipping facilities. The crucial factors to consider when choosing shipping facilities are reliability, speed, flexibility, transparency, cost and proximity to customers. When you deliver large amounts of products simultaneously, you need to have the following facilities. If you find a B2B marketplace that has all these features, you may choose it to sell your products without any further delivery issues.

  • Ability to print shipping labels and invoices
  • Automated order fulfilment and shipping
  • Automated shipping notifications and updates
  • Bulk shipping capabilities and order management
  • Customer self-service tracking and updates
  • Integration with international shipping and customs
  • Integration with shipping software and APIs
  • Multiple shipping options and carriers
  • Real-time shipping rates and tracking
  • Returns and refunds management tools

The best B2B online marketplace will allow clients to monitor the way customers purchase, the biographic details of customers, and produce actionable insights. These are all important because technology has been evolving swiftly and purchasing trends changes daily. When sellers closely monitor this data, they can make adjustments to their offerings to capture the desired demographic sales. Here below are the best features of analytics, which a (or that a) B2B marketplace should have.

  • A/B testing and experimentation tools
  • Conversion tracking and optimization
  • Customer lifetime value analysis
  • Customizable reports and dashboards
  • Integration with third-party analytics tools
  • Marketing ROI and campaign analysis
  • Real-time sales and revenue tracking
  • Sales forecasting and inventory analytics
  • Visitor and user behaviour analytics
  • Website traffic and referral source analytics

Personalized experience
The B2B marketplace should allow clients to develop an online store that is mobile-optimized, SEO-friendly, and easy to navigate. If you want your B2B store to reach more customers, the designs of your store should interact with your customers. Here below are the best features of a B2B marketplace, which interact with your customers.

Or add:

If you want your B2B marketplace to win, you should follow these steps:

  • Create digital commerce teams that are capable to evaluate data through AI & advanced analytics
  • Give the buyers the information they need by providing the right mix of product data, specs, illustrations, and photographs on your marketplace listings
  • Work with a qualified e-commerce solution provider
  • Work for higher conversion rates
  • Practice purchase delegation
  • Customizable customer profiles and preferences
  • Customizable website content and messaging
  • Dynamic pricing and product bundling
  • Integration with personalized email marketing
  • Loyalty programs and rewards
  • Personalized product recommendations and upsells
  • Personalized promotions and discounts
  • Targeted messaging and communication options
  • User-generated content and reviews
  • Wish lists and saved shopping carts

Inventory management
The most effective B2B online marketplace platform should have powerful inventory data. These are software platforms built to optimize and modernize the process of managing inventory for B2B transactions online. B2B clients need to have access to order tracking, one-click reordering, shipping information, quote approvals, and other functions that help to manage their accounts smoothly. Self-service inventory management allows B2B customers to place their orders in a fast and efficient approach and supports them to avoid costly backorders. Here are the best tools that the best B2B marketplace should have.

  • Automated inventory replenishment tools
  • Automated restocking and forecasting tools
  • Customizable inventory categorization and management
  • Integration with barcode and scanning tools
  • Integration with third-party inventory management tools
  • Inventory aging and obsolescence tracking
  • Multi-location inventory tracking and management
  • Purchase order management and tracking
  • Real-time inventory tracking and alerts
  • Sales and demand forecasting and analysis

There are several B2B online platforms, with unique features and wonderful benefits, available on the market.  When you choose a B2B platform, it is essential to make sure that the platform has all the functionalities you need to manage the versatility of your sales processes. An online store is the face of your company and the body of all your marketing strategies. You can connect directly to products and services in your marketing emails and advertising campaigns and can monitor the success of your efforts to plan your next goals.

An MMT Perspective on how Agenda 30 could be Implemented in Australia

Covid-19 has shown that governments with monetary sovereignty can turn the tap off quickly,  if they must, and just as easily turn the tap back on. This has been coupled with a new appreciation for the ability of a sovereign economy to operate effectively despite large levels of net government (and net foreign) debt as a proportion of GDP, reconfirming the experience of those governments during WWII, when debt was used as an instrument to curb consumption and to redirect productive resources and research activity into investment in new capacity and new technology to support the war effort (viz the Agenda 30 strategic policy goals). 

A similar imperative now confronts nations as they direct resources into a sustainable transformation of the economy. This paper will contribute to these policy objectives by examining the respective economic roles to be played in this transformation by the Job Guarantee, the Green New Deal, and what Mazzucato chooses to call “ mission-oriented finance”! In this context, a range of metrics for guiding policy is also evaluated.

Keywords: Modern Monetary Theory, Agenda 30, Green New Deal, Job Guarantee, Mission-oriented Finance, Short-changing Nature. 

1. Introduction

The main purpose of this paper is to clarify both the rationale for, and policy objectives underpinning, a range of interventions recently advocated by Modern Monetary Theorists (MMTs), within the context of the UN’s Agenda 30 strategic policy goals. Specifically, it will address the Job Guarantee (JG) as an anti-inflationary instrument and the Green New Deal (GND) as a means for redirection of resources and capital investment.

However, I intend to achieve this clarification within an academic context where it has become fashionable to question MMT for its on-going adherence to supposedly inadequate or erroneous theoretical principles. Much like much like Marc Antony in Shakespeare’s Julius Caesar, who guilefully claimed that he came “to bury Caesar not to praise him”, for although Brutus (along with Georg Friedrich Knapp and Abba Lerner) was purportedly an honourable man, MMT is faulted on a fundamental level for its less than honourable fidelity to the principles of (i) neo-Chartalism; and, (ii) Functional Finance.

The first theoretical allegiance is criticised on the basis of a broader Post Keynesian or Marxist interpretation of “money with no intrinsic value”, which questions the notion that stability in the value of money, when it functions as both a unit of account and a store of value, can be guaranteed solely by the legislated requirement that it be used for the payment of outstanding tax obligations (Lapavitsas & Aguila, 2020, is representative on this strand of critique). The second allegiance is questioned by so-called Structuralists, on the basis that current account deficits and cumulative net foreign indebtedness do matter, especially for emerging economies, which suffer from being situated low in the global currency hierarchy, plagued by a narrow, commodity-based admixture of exports, while subject to a rapidly destabilising pass-through of exchange rate fluctuations onto tradeable goods prices (for examples of this Structuralist critique, see Prates, 2020; Vernengo & Caldentey, 2019, for critiques, and Carnevali et al., 2020 for a discussion of strategic pass-through as a generalization of the Marshall-Lerner conditions).

With the intention of clearing the way for a more focused discussion of macroeconomic policy options, I wanted to briefly respond to the above-mentioned criticism of MMT’s theoretical foundations. To begin with, I wanted to highlight the fact that, in the 1980s, the Australian tradition of MMT developed within an environment where many mainstream and more left-wing economists adopted what were effectively Structuralist arguments to argue that a return to policies of full employment that were temporarily abandoned in the last year of the Whitlam Labour Government, was prevented by a “Balance-of-Payments Constraint”. When Hawke-Keating Labor Government was returned to power in the early 80s, Treasurer Paul Keating, largely mirrored then ex-Prime-Minister John Howard’s obsession with the rising level of foreign debt.

In Australia, back in the 80s, a series of inter-linked Structuralist arguments legitimised a sustained assault on the wages and conditions of Australian workers, and ultimately, the level of trade union influence. However, the biggest impact on the industrial working class could be sheeted home to rising labour underutilisation (a combination of rising unemployment and ‘precariousness’). With the clear intention of reducing the “real wage overhang,” workers were encouraged to trade-off increases in the ‘social wage’ for cuts to real wages as a means of restoring the international competitiveness of Australian goods and services.

In grappling with these problems, progressive economists often (incorrectly) applied Kaldor-Thirlwall multiplier models of trade to the case of floating rather than fixed exchange rates (McCombie & Thirlwall, 1994)[1]. On this view, income elasticities of demand dominate in their effects over exchange-rate related price-elasticities. A country like Australia is seen to have a high income-elasticity of demand for imports whereas the rest of the world has relatively low income-elasticities of demand for Australian exports. Accordingly, if Australia were to grow too rapidly compared with rates of growth exhibited by our major trading partners, the current account deficit would widen dramatically. “Stop-Go” policies would be the inevitable result.

Within the Commonwealth Government bureaucracy, it was commonplace for economists to refer to the “twin deficits” hypothesis, which viewed total public sector debt as the main driver of deficits on the current account. Similar views were actively promoted by supposedly ‘left wing’ economists in the National Institute of Economic and Industry Research, officials at the OECD, and members of Secretariat of the tripartite Australian Economic Planning and Advisory Commission. At around the same time, there was much-heated debate about “Dutch Disease” (i.e., the “crowding out” of other industries when the resource-sector expanded) and the “J-curve” effect in Australia (which arises when an exchange-rate depreciation initially worsens the trade deficit before contributing to a gradual increase in net exports).

Both Marxist and Post Keynesian critics of MMT have emphasised the importance of the global currency hierarchy, the determinants of effective sovereignty, and the influence of conventions and confidence in the whole monetary system as having some bearing on the value of money. And Chartalist views have been questioned on the dubious basis that spot/forward contracts were developed before effective principles of taxation were formalised. It has been claimed that many developing economies simply “will not find foreign demand for their currencies”.

Kaltenbrunner (2012) has attempted to achieve an integration of what she calls the ‘horizontalist’ or structuralist position and ‘verticalist’ interpretations of monetary policy in open economies (the work of Lavoie, 2000, 2002-03 can be seen as illustrative of the ‘verticalist’ position, especially in his interpretation of the covered interest parity condition).  To this end, she has identified three structural factors that determine the ability of a country to meet outstanding external obligations (and thus, the liquidity premium on its currency); namely: (i) a country’s total stock of net (short-term) external obligations (expressed as a proportion of GDP); (ii) the proportion of its liabilities denominated in foreign currency and the possible existence of other liabilities to foreign investors; (iii) a country’s ability to meet its outstanding liabilities through “forcing a cash flow in its favour” either through the income generation process (including income from previous rounds of lending) and/or dealing and trading in capital assets and financial instruments; and finally, if current cash flows are insufficient to meet outstanding obligations, (iv) the ability to “make positions” (i.e. to refinance existing debt and/or to liquidate assets).

The question for policy makers is whether a country exposed to external pressures in each of these three ways, can put together a cluster of policy interventions, including capital controls, to counter any likely shocks (while recognzing the fact that floating exchange rates ensure greater levels of autonomy in the pursuit of effective fiscal policy). This is where consideration must be given to a range of policy instruments that help to develop and diversify the economic and trading base.

Personally, I see a strong resonance between Marxist views on the credit system, when it fails to work as a means of payment, and Minsky’s notions of financial instability, which have long been accepted by MMT advocates. By the same token, I see little difference between Marx’s conception of money with no intrinsic value and Chartalist efforts to explain how a stable value for the national currency can be established.

In the next section of the paper, I will examine the Job Guarantee (JG). This will be followed by an interpretation of the Green New Deal (GND) as a policy for controlling inflationary pressures in the long run, while achieving dramatic changes in the resource base.  Australian MMT researchers would insist that a raft of supplementary policies (apart from, but including capital controls) can also be adopted as supplements in the pursuit of full employment, including tax policy, industry policy and a strategic commitment to industrial development on the basis of competencies.

2. The Job Guarantee in a “Nutshell”

The JG is premised on the fact that only the national government (as issuer of fiat currency) can create Net Financial Assets (NFA) through deficit spending. To avoid any under-employment of labour and productive capacity, the flow of NFA must match non-Government sector’s desire to net save. Otherwise, there would be a shortfall in effective demand. Jobs created through the issue of NFA would be paid at minimum wage and designed so that they do not directly compete with those to be subsequently created within the domestic private sector via the multiplier.

The JG labour-force thus functions as a “buffer stock” whose primary role is that of anti-inflationary instrument This is because the uneven distribution and persistence of underemployment means that traditional policies of public investment would otherwise meet inflationary bottlenecks well before full employment is reached (Mitchell & Juniper, 2007).

Mitchell (2020) explains how a JG operates as a superior means for the control of inflation when compared to the mainstream pursuit of a non-accelerating inflation rate of unemployment (NAIRU). The effectiveness of inflation policies based on NAIRU can and has been undermined by: (i) the continual movement of workers out of short term into long-term  unemployment; and, (ii) the dramatic rise in the proportion of those in precarious employment.  In the more technical literature on inflation, these combined effects are said to have contributed to the development of a “horizontal” Phillips Curve.

Fig. 1., below, suggests how the JG could operate by comparing three positions on the traditional Phillips Curve, which depicts trade-offs between realized inflation and unemployment. Governments increase effective demand in response to high unemployment in position A, moving to position B, at the cost of a rise in inflation from IA to IB. If a JG were put into place, the economy could instead move to position C, achieving full employment at the original rate of inflation.

3. The Green New Deal in a “Nutshell”

Where the JG is a short-run anti-inflationary mechanism, the Green New Deal (GND) is a log-run anti-inflationary mechanism for achieving a dramatic transformation in the economy through intervention in the process of capital accumulation. The GND adopts the methodology originally proposed by J. M. Keynes in his pamphlet on How to Pay for the War in the context of responding on a massive scale to environmental problems such as climate change (Nersisyan & Wray, 2019).

Under this modern version of the scheme, the stages to be followed are first to estimate the “costs” of the GND in terms of resource requirements; second, to assesses resource availability that can be devoted to implementing GND projects. This includes mobilisation of unutilized and underutilised resources, plus shifting of resources away from current destructive and inefficient uses into GND projects. Here, the main problem that could arise is that of inflation if sufficient resources cannot be diverted to the GND. Accordingly, the scheme also proposes a series of anti-inflationary measures, which could include well-targeted taxes, wage and price controls, rationing, and voluntary saving. During WWII, voluntary saving was accomplished, both Great Britain and the US, through issue of war bonds to all classes in society. This combination of policy interventions is summarised in Fig. 2., below.

4. Industry-Policies and Economic Development

Through an historical and political analysis of the East Asian development model, have Amsden and Wade have highlighted the difficulties faced by developing economies that are located at some distance from the frontier of best practice, yet still want to tilt the “playing field” away from existing configurations of comparative advantage. Amsden (1989) emphasises the need for a strong state to impose binding condition of reciprocity on corporations and sectors that benefit from a variety of subsidies designed to influence the path of capital accumulation. Wade (1990) attends to the complexity of “governed market” interventions that might appear to be even-handed in regard to trade versus non-traded, or import-substituting rather than export-oriented industries (conditions which he describes as those of a “simulated free-market”), yet nevertheless still provide incentives for advancement.

The work of Felipe et al., (2012) builds on the competency-based economic analysis of strategic development. This research updates work originally conducted by Hidalgo and Hausman using another set of data encompassing 5107 products and 124 countries. A minimal spanning tree is constructed for global trade based on proximity links between different products. Production of traded goods located at the centre of the network is seen to require a more diverse and non-ubiquitous but unobservable set of competencies. In countries such as India and China, policy makers seem to have been able to exploit available proximity links in their efforts to expand both the scale and scope of what is being produced and traded.

More recently, Barry Naughten (2021) has identified a shift in Chinese industry policy away from sectoral policies for strategic emerging industries towards policies that promote core digital technologies that, if successful, would enable China to leap-frog ahead of EU and US industries in a selected range of key domains (including digital fabrication and production, quantum computation, AI, and machine-learning, big data and the internet-of-things). Understandably, Naughten is reluctant to evaluate the success or failure of these initiatives, remarking that insufficient evidence has yet been amassed to make such judgements. He describes at some length the Industry Guidance Funds (IGF) that China deploys to coordinate different forms of investment at all levels of government—national, provincial, and local—in innovation, infrastructure, and commercialisation of these technologies—while identifying potential sites of failure and emerging risk.

Along similar lines, Mazzucato and Wray (2015) have emphasised the important policy role of State Investment Banks for “entrepreneurial states” wishing to engage in counter-cyclical expenditure, capital development, and new venture support. In particular, they describe an over-arching process of “mission-oriented” finance instantiated by Eisenhower’s efforts to “land a man on the moon” before the Soviet Union. The interventions of a variety of agencies—both public and private, including the newly formed NASA and DARPA—were orchestrated to achieve this set of aims, through the injection of finance at each stage in the innovation chain (i.e., from research, through concept invention, early-stage technology development, and product development, into final production and marketing).  If successful, China’s IGFs would fulfil all of these requirements. This same kind of coordinated approach could readily be harnessed to achieve ecological rather than military and geo-political goals.

5. Metrics for Short-Changing Nature

In a talk I recently gave to members of MMT-Australia I focused on the limitations of mainstream approaches to Ecological Economics focusing on the modified neoclassical framework of Pearce and Turner (1990). My major concern was to question those who saw policies for full-employment as being in contradiction with interventions designed to achieve ecological sustainability. However, I also questioned the notion of environmental capital, which featured in Pearce and Turner’s ‘4 Capitals’ model of sustainability. Accordingly, I turned to Marx’s concept of ‘fictitious capital’, which he applied both to human capital (with labour services being capitalised into a ‘stock’ using a discount rate that simply reflected the rate of exploitation) and to the capitalisation of fictitious structures of money taking the form of credit as a means of payment, that were increasingly divorced from real processes of capital accumulation. I suggested that environmental capital could be viewed as an equally fictitious concept, insofar as it attempted to ‘capitalise’ ill-defined flows of ‘environmental services.

I moved on to the need to build more rigorous bridges between Value Theory (understood in terms of Classical rather than Neoclassical Political Economy) and sustainability metrics (which adequately accounted for the ‘short-changing’ of nature). In the Classical system, prices are determined by socially necessary labour time, including the application of the labour embodied in productive capital. However, from a sustainability perspective, this should include the labour time required to recycle renewable resources, reduce other forms of waste, mitigate the impact of pollution, and discover substitutes for non-renewable resources whose stocks were being depleted (as argued by Moore, 2017).

To this end, I emphasised the proximity between this Classical theory of reproduction pricing, Leontief’s Input-Output Analysis (which has been taken up by a whole generation of Industrial Ecologists), and national accounting conventions for the measurement of GDP (on the former see Schmelev, 2012, along with Suh and Kagawa, 2005; on the latter see Flaschel, 2010). I then suggested that metrics for sustainability could be constructed by adopting techniques of linear programming that had been developed by mathematical economists and planners in the former Soviet Union, because these techniques were also grounded in the labour theory of value. At the time I was unaware that Paul Cockshott (2010) and his PhD student, Jan Dapprich (2020), had already pursued this approach to sustainability modelling, using modern software, while building on the research of Kantorovich (1939, 1965) and Novozhilov (1970) (also see Ellman, 1968 and Holubnychy, 1982).

For convenience, the various elements of what has been proposed above, are brought together in the Fig. 3., below.

6. Conclusion

By way of a recapitulation, let me suggest that policies such as the JG and the GND complement one another and, in combination, demonstrate ways that Agenda 30 can be successfully implemented both in Australia and elsewhere. I went on to argue that the Job Guarantee could serve as a short-run inflation control mechanism, while promoting full-allocation and processes of capital accumulation, to achieve sustainability objectives, while avoiding inflationary pressures over the long-run.

In arguing for this position, I also wanted to highlight the fact that MMT is and has always been cognisant of difficulties faced by ‘emerging economies. For this reason, I also considered a raft of industry policies that could assist developing nations in their efforts to progress up the technology and productivity ladder (even leaving the existing technology frontier behind them in their wake), while diversifying their trade activity. Industry policy can take a long time to come to fruition and some merging economies may be exposed to difficulty when servicing ballooning foreign debt. Under these circumstances capital controls may also fail to stem the tide of increasing financial obligation. However, as Kaltenbrunner (2019), explains, only a certain number of emerging economies would fall into this category. MMT advocates maintain that the loss of fiscal autonomy that would result from any move towards a fixed or ‘dollarised’ exchange-rate, would unfortunately be a heavy price to pay for the achievement of currency stability, even in the short-run.

Finally, I touched on ways that sustainability metrics could be developed using techniques of linear programming that deployed a modified labour theory of value approach to account for various ways in which nature was being ‘short-changed’. In this way, programmes to achieve full-employment could be designed to complement efforts to transform productive activity in ways that met ecological sustainability objectives.

Author: Professor Dr. James Juniper – Conjoint Academic, University of Newcastle; PhD in Economics, University of Adelaide


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