In this episode of the McKinsey Global Institute’s Forward Thinking podcast, co-host Janet Bush talks with Pedro Conceição. Conceição has been director of the Human Development Report Office of the United Nations Development Programme, UNDP, since 2019. In this podcast, he covers topics including growing inequality, a failure to manage growing global interdependency, and the need for a 21st-century architecture to deliver global public goods.
Janet Bush (co-host): Michael, how influential do you think that the Human Development Index from by the UNDP has been?
Michael Chui (co-host): I would say it has been enormously influential. When we talk about economics, we tend to think about money, competitiveness, growth, productivity, and wealth. But the UNDP reminds us that economics is about people and their livelihoods and welfare. And, of course, those things are incredibly important.
Janet Bush: I agree. But humans and their development are not in a good place at the moment, according to our guest today. He presents a pretty sober picture, but also some ideas on how to turn the corner.
Michael Chui: I would really love to hear more.
Janet Bush: Pedro, welcome to the podcast.
Pedro Conceição: Thank you for having me, Janet. It's a pleasure.
Janet Bush: Tell us a bit about your journey to becoming an economist, and especially your interest in human development.
Pedro Conceição: I actually started as a physicist. I studied physics in college and did research in physics. And from there, I started becoming more interested in how science and innovation can help countries in their economic development, particularly looking at countries like my own, where I’m from, Portugal, that were on a process of convergence towards the standards of living of other, richer countries in Europe.
And then from there, the interest broadened even further, to try to understand how countries at, particularly, lower levels of income could make that journey towards higher standards of living. So that led me to decide to come work for UNDP, the United Nations Development Programme, which has that mission within the United Nations, to support countries on their development journey.
Human development is what makes the UNDP particularly distinctive. There are many players that are supporting countries on their development journey through different ways. Some are firms. Some are the international organizations. UNDP is distinctive in that it brings to our work these human development plans, which are centered on enabling people to live life to their full potential.
So that was, in summary, how I went from studying physics in Lisbon, Portugal, to working on human development, in New York City at the moment.
Janet Bush: Let’s dig into the latest report, which is quite worrying in tone, I would say. It talks about us being in a state of global gridlock. What do you mean by that?
Pedro Conceição: It reflects the perception—the reality, I would argue—that we are not making enough progress on some of the shared challenges that we confront as an international community.
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Climate change is an example. The way in which we managed the pandemic, the first of this magnitude in 100 years or so. It’s worrying that we are not doing as well as we should. And we seem to be stuck. That’s why I use the word “gridlock.” It’s not like we aren’t doing anything. There are many efforts. But clearly, we haven’t done as well as we could have.
Again, we are not doing what needs to be done with the intensity and the speed that is required when it comes to addressing challenges that reflect our interdependence, the interdependence of our societies.
There’s a lot of effort on advising countries or giving them resources so that they can do the right things domestically, within their borders. And of course that’s important. But what the report suggested, when it comes to addressing these challenges in which we are interdependent as an international community, we are sort of in a state of gridlock.
And this is put in sharp relief when it gets to the stage of violent conflict between countries, which we are also seeing now, around the world, reaching levels comparable or even higher than at any point since the end of World War II.
Janet Bush: Yes. The report highlights three very negative developments, not only war—being at the highest level of violent conflicts since World War II—but also rising inequality and rising global temperatures. But on the inequality side, after 20 years of progress and for the first time on record, inequality on the Human Development Index is growing between countries at the bottom and countries at the top. That must be very depressing for you.
Pedro Conceição: It is very depressing, Janet. And just to give a little bit more detail about what kind of inequality is increasing, it’s a very specific kind of inequality. It’s the inequality between countries at the very top of the Human Development Index and countries at the very bottom of the Human Development Index.
That difference, that gap had been narrowing for decades. And starting in 2020, it started opening up again. This is very concerning, because in the United Nations we have something called the 2030 Agenda for Sustainable Development that was approved by the United Nations member states. The Sustainable Development Goals emanate from that.
It includes a pledge, a pledge to leave no one behind, and actually to reach the furthest behind first. So it’s concerning that this specific kind of inequality is happening now. We characterize it as a process of divergence after many years of convergence. And we are also seeing this happen, actually, within countries. Not necessarily everywhere, but in many countries, there are parts of society that are being left behind.
For instance, in Europe, in the context of the European Union, up to a third of the population in the European Union lives in regions that are being left behind economically, as other regions within countries and within the context of the European Union are prospering. So these patterns of divergence across countries and within society are, we think, very concerning.
Janet Bush: And what do you put it down to? What has happened to stop that gap narrowing between the very top and the very bottom?
Pedro Conceição: Obviously there are many reasons. But I come back to this fact that we are not managing interdependence in the right way. Of course it’s a complicated story. There are many factors causing this divergence.
A critical one, even that has happened since 2020 and has persisted, is the fact that the way in which we managed the COVID-19 pandemic, which is a manifestation of this interdependence, enabled those countries with the resources, with the fiscal space, with the actions that the monetary authorities took that were very aggressive to support their economies.
In fact, the US Federal Reserve, for instance, enabled all viable firms in the United States to continue operating by buying their debt. So there was very aggressive action taken by, in a sense, rich countries that have the means, the ability, the capability to do that.
But those countries with less fiscal space, less resources, were sort of left behind. And not only did they not have the means, but to respond, they have to incur debt. And so now there is this sort of double whammy of the fact that they did not have the resources, these low Human Development Index countries, to respond.
Now because they had to go into debt, they have to pay the debt service, which has been increasing. Because to respond to the inflationary pressures, as we all know, monetary authorities in high-income countries are increasing their interest rates.
It’s just a cycle that suggests that—it’s not like these countries were necessarily doing anything wrong. I mean, probably they could have done better. But a lot of the divergence has to do with the mismanagement of interdependencies.
Not only the pandemic, the health aspects of the pandemic, but the economic implications of the pandemic, and also the fact that some of the actions that rich countries have taken, legitimately, to protect the interests of their population also have this spillover, the negative effects on these low-income countries.
Janet Bush: And why was the debt incurred by these countries? Was it to buy vaccines? Or was it simply they needed the debt to keep their economies going?
Pedro Conceição: To keep their economies going, to provide for social transfers, to buy the means to respond to the health emergency—not only vaccines, but other health goods and services. There was just this discrepancy that was really put in sharp relief in the context of the pandemic between countries that have domestically the ability to respond and those that don’t have, and the consequences and spillovers of the actions that different countries have on others.
Janet Bush: So I suppose theoretically this blip, this big blip, could work itself out. But I think you’ve talked about the risk of permanent losses in human development unless something changes.
Pedro Conceição: That’s another worrying trend, which is related to something slightly different than the divergence.
What we’ve seen over the last couple of years is that the global Human Development Index, which is this composite indicator that brings together achievements in standards of living, health, and education—it’s something that considers the performance of the economy, because it’s important for people, income, employment, so how the economy’s doing—but doesn’t stop there, looks at other things that are important for people’s life, the ability of people to live long and healthy lives and have access to knowledge to participate in the economy, but also in society.
This is very much attached to the notion of human development. This indicator, Human Development Index, the global indicator, the average for the world, if you will, has been steadily increasing since 1990. Even during major shocks like in the aftermath of the global economic crisis, the Great Recession in 2009, 2010, we haven’t seen a decline in the global Human Development Index. There was a decline in some countries.
But what happened in 2020 and 2021 was a decline in the global average for the first time ever as well as a decline in the Human Development Index in 90 percent of the world’s countries. As I mentioned, this global Human Development Index is now going up.
So the trend of improvement has increased. But the trend has shifted downward compared to the trend we would have expected had we not suffered the decline in 2020, 2021. So it’s that gap between the possibility, or the potential I guess of improvements in human development had we not seen the decline and the trend that we currently are on. That gap, that difference, if it persists, if we are not able to bend the curve so that it catches up to the pre-2019 trend, that represents long-term losses in human development, in human potential.
That can become permanent, again, if we are not able to bend the curve. So we might be able to bend the curve. But if we are not, then these represent potential loss. And it speaks to the importance of not looking at what we went through as a blip that we recover from.
The literature sometimes used the expression of “scarring.” There are scars that are long-lasting and potentially permanent. So the costs of this crisis are not something that is temporary only, that people suffer through as we all did during the pandemic, but can have very long-lasting, potentially permanent effects.
Janet Bush: So it’s like the scarring effects that you get with long-term unemployment. They just don’t go away very easily.
Pedro Conceição: Exactly. Long term, or even if it is not long term in unemployment, what literature suggests is that during economic recessions, people that live through the economic recessions often have negative implications that last for their whole lives.
So, for instance, people that enter into the labor market during a recession, typically young people, carry a scar of that, for no fault of their own, into the rest of their lives. That’s what is actually one of the reasons why authorities in high-income countries acted so forcefully to mitigate the economic recessions that we went through in the context of the COVID-19 pandemic, obviously to protect people during the emergency, but also to avoid the scarring effects. That was very explicit in the discourse and the justification of the policies by many policy makers in high-income countries.
Janet Bush: You’ve talked about the failure of managing our interdependence. And I wondered whether you think that the interdependence is rising. And I think that you’ve talked about viruses, obviously the pandemic, but also the microplastics, forest fires, other manifestations of climate change. Are we becoming more interdependent?
Pedro Conceição: So, Janet, this is a very important question. Because in a sense, if we look at economic interdependence, economic interlinkages, that has been increasing for a long time as a result of policy choices that have been made about what kind of flows do countries allow to move across borders. Flows of goods, services, capital, and people.
There was a process that went on, really until a few years ago, in which choices went in the direction of making these flows move across borders more easily. This is a process of economic globalization. Some people, like Dani Rodrik, for instance, argue that it was, in a sense, excessive. He used the expression “hyperglobalization.”
What we have seen more recently is that this kind of interdependence has not declined but has sort of stabilized. So it’s still there. And it’s something that needs to be managed. But what our report calls attention to is that there are two drivers of interdependence that are becoming more important and perhaps even more relevant, likely to persist well into the future.
One has to do with the very self-evident point that we share a single planet. Addressing challenges like climate change, for instance, is not something that can be managed with decisions at the borders. You can make different decisions on economic globalization.
We can say, “Well, maybe we liberalize trade too much or too quickly. So we have to move back a little bit on that. Or maybe capital flows were moving around too freely and we need to get a handle on that.” But when it comes to climate change, decisions at the border are not going to enable us to solve the problem.
Climate change is one of the ways in which our planet is changing, but there are other ways. You mentioned microplastics. The world of life, the world of biodiversity also doesn’t respect borders. There are implications with losses in biodiversity in a part of the world that affect other parts of the world.
The first driver that is going to continue for sure for decades into the future is this process of planetary change, dangerous planetary change for people that needs to be managed in a collective way. It cannot be managed at the borders.
And then the second driver has to do with the digital transformation, with the fact that information is flowing at a very rapid clip, as we all know. And while it’s possible to impose some limits and some limitations on the extent to which this information flows across borders, it’s difficult. It’s costly.
That’s why the report argues for the importance of addressing these two aspects of interdependence and also calls attention to the implications of not doing so. One of the implications of not addressing climate change, for example, is that the disparity in mortality rates between high human development countries and low human development countries will sort of explode.
This process of divergence that we have seen happen, retrospectively, in the context of COVID-19 is in the cards, prospectively, if we do not manage aggressively these interdependencies. That’s why this gridlock that’s in the title of the report is so concerning.
Janet Bush: So, on digital, flows of digital, flows of information, flows of intellectual property—surely that’s a good thing.
Pedro Conceição: It is a very good thing. And in much of this—interdependence—there’s a positive aspect to it. That’s why we’ve been very careful in the way in which we frame the report as to not portraying interdependencies as a necessarily bad thing.
It’s more about the way in which we manage it. First of all, recognizing that it exists and manage it. What does “manage” mean? Well, mitigate the risks, the downsides, the negative effects, and enhance the potential of the positives associated with them.
Janet Bush: So what are the downsides of these digital flows going around the world?
Pedro Conceição: One is misinformation that has been actually heightened now with generative AI. Because information, the way in which we deal with information, is crucial not only for economic transactions but also for the way in which our political systems work.
Very rapid flows of information at scale produced very rapidly, that may embed misinformation, can be very damaging, not only economically—reputation of firms, for instance, or individuals—but also they can poison the political process, making for patterns of political polarization, for instance, to be heightened.
Janet Bush: The trade issue is an interesting one. We at MGI just wrote a piece called “Geopolitics and the changing geometry of global trade.” And it shows that there is the beginning, in some very specific cases—the US, China, Europe—of some sort of drawing back from hyperglobalization, as Dani Rodrik said. If that were to continue, and trade flows were not as free, would that compound the issue for low-income countries?
Pedro Conceição: First of all, it’s a very good report, and we cite it in our human development report, and we drew from it. There are different views. So one—I don’t know if Dani Rodrik subscribes to this view, but, you know, going with his analysis that hyperglobalization had damaging effects, but equally domestically, we can discuss this a little bit more.
I think it’s reasonable to attend to these negative effects that perhaps were not foreseen or considered enough in the past. But as you alluded to earlier, Janet, there’s also many benefits that come out of open and free trade flows. Many low- and middle-income countries benefited. Some would argue that they could have benefited much more, but benefit certainly from this.
Our colleagues at the IMF have actually quantified the potential for this. I think they call it “geo-economic fragmentation.” And they came up with some estimates that there are actually economic costs.
But to go back to some of the drawbacks, or the potential negative implications, of this hyperglobalization, one that we now understand much better is that even if the negative effects were not very large at the aggregate level, at the aggregate of the economy in many countries, they were sort of localized. They affected particularly communities, particularly special regions, very, very heavily. And this implicit promise that if there are aggregate efficiency gains, some of them would actually be redistributed to redress the communities that lost out in the process.
That—I don’t know if it wasn’t explicit, but certainly implicit—promise, or perhaps expectation, didn’t materialize. And we see this panning out in many countries, the United States, parts of Europe. There are regions that were sort of left out of this process. And again, in the aggregate, their weight is not that large. But these are people that lived in these communities that, again, feel left behind.
Janet Bush: You talk about an uncertainty complex. And you also talk about a pervasive sense of disempowerment. What do you mean by, first of all, the uncertainty complex? I think we all feel it. But it would be interesting to get your take on it.
Pedro Conceição: The uncertainty complex was an interpretation of a reality that was leading many people around the world to feel insecure about many aspects of their lives. According to our estimates, six out of every seven people around the world feel insecure about some aspect of their life.
This is something that you do not see reflected in the objective indicators of well-being, including our own Human Development Index. Yes, it declined a little bit. But now it’s on the way up again, and for the most part—again, with the blip that that I alluded to in 2020, 2021—we have now the highest levels of the Human Development Index on record in all of the dimensions on average.
So there is this discrepancy, this paradox, if you will, between what people perceive and what the objective data tells us about how the economy is doing and what their objective living conditions are.
So where does this insecurity come from? Our contention is that it’s associated not so much with the world being more uncertain or unsettled today than in the past, which would be something very difficult to establish, but rather that there are aspects of uncertainty that are either novel or acquiring new configurations.
What are these novel aspects of uncertainty that form this uncertainty complex? We argue that there are three. One is a context of dangerous planetary change that I already described. This is unprecedented. There’s an ongoing discussion about whether we should use terms like the Anthropocene. Geologists reject it as a geological term, but the idea that humans are reshaping how the planet functions remains very much valid and alive. This is the first thing that is new, unprecedented not only in human history, but in the evolution of our planet.
Second, the digital transformation that you already alluded to, with its mix of potential promise but also new challenges, new risks.
And then the third, which was the focus of our latest human development report: political polarization. A heightened sense of political polarization—not only sense, but the reality of political polarization, which has been increasing, according to some of the data that we cite in the report, in two-thirds of the world’s countries over the last ten years.
Political polarization is obviously not something new. It has happened in other periods in history, particularly in the 1920s and 1930s. But it’s now acquiring a new configuration and having implications that are making, going back to the challenge of managing interdependence, making it more difficult for societies to manage their shared challenges, both within countries and across countries.
Janet Bush: I want to talk more about how to improve our handling of our interdependence in a more polarized world. But before we do that, just to go back to empowerment, MGI, as you know, has done a lot of work on sustainable and inclusive growth and how to get all those things at the same time, and that they depend on each other.
We introduced this empowerment line—that’s the point at which individuals can meet their essential needs and begin to have some security. It was a new take on the old poverty indicators. We estimated an empowerment gap of 8 percent of GDP annually, which is very, very large. What do you make of that? Does that accord with the way you’re thinking?
Pedro Conceição: I think it’s a very good report and a very important contribution that McKinsey did, because it speaks to something that is often neglected and is very central to the notion of human development.
Often, the focus of policies or analysis is on well-being, people’s well-being. And that’s important for human development. That’s what the Human Development Index captures. But along with well-being, it’s important from the human development perspective, this notion of empowerment that the McKinsey report was able to quantify.
It’s not only about enabling people to reach a minimum threshold that enabled them to live their lives with the basic needs met. It’s about whether people have the conditions to feel in control of their lives. In our jargon, we use the notion of agency. I might use the phrase from Amartya Sen that we cite very often, that we should look at people not only as patients, recipients of services or benefits, but also as agents able to shape their future.
The McKinsey report that you cited very much gave salience to this notion of empowerment. And that puts additional demands on what we often consider to be the focus of resource allocations and policies. We are very much aligned with your thinking, and we had the privilege of having conversations with some of the colleagues involved in the report that were also helpful to us and, again, were very important to bring greater visibility to the notion of empowerment, agency, the ability of people to feel in control of their lives.
According to our data from the World Values Survey that we use in our report, half of the global population today does not feel in control of their lives. So there is a huge “agency gap,” we call it.
And finally, on this point, I will connect it to these perceptions of insecurity. We also find that the more insecure people feel, the larger this agency gap is. So there’s a connection between this perception of insecurity and lack of empowerment, lack of agency.
Janet Bush: In this difficult world of ours, people are feeling disempowered, insecure. So the question is what do we do about it? Your suggestion is that we have to work together more. There are three things, I think, that you’ve said. One is to overcome misperceptions. Why is that so important? It’s not just the misperception that you are worse off than you actually are.
Pedro Conceição: Some of the challenges that we confront require more than individual commitment to addressing problems. They require collective action. And often we know that transformation, social, political transformations, economic transformations require moving beyond what sometimes is called “pluralistic ignorance.”
What is pluralistic ignorance? It’s the fact that people hold individual beliefs about what should be done but consider that those around them do not share those same beliefs.
I’ll give an example that we cite in the report. A recent survey asked people if they would be willing to make a personal financial sacrifice to mitigate climate change. Almost 70 percent of the global population responds yes to this question. They would be willing to do so.
Then they asked a second question: Do you think that people around you share that same belief? The percentage drops to 40 percent. So addressing climate change, as we all know, and we can go down the list, is something that does not depend only on how committed individually we are. It depends on collective action. It matters not only what we think as an individual, but what we think society believes.
In a sense, the message is that we actually agree on more than we think we do. But we are under this veil of pluralistic ignorance, or this fog of pluralistic ignorance. Piercing through this fog of pluralistic ignorance and enabling people to realize that actually we are more on the same page than we think we are, has been shown—experimentally—to be one of the most effective ways of enabling people to change their behavior.
Janet Bush: Because I guess that if you think that nobody else is going to do something about climate change, then you’re less likely to take individual responsibility in your own life.
Pedro Conceição: That and also, even if you do so, even if you are very committed to mitigating climate change and do everything you can within your power—the way you move around, what you eat, looking at your carbon footprint, you can be a very committed individual. That’s not enough.
And if you believe that people around you do not care as much as you do, then the way in which we express political views, for instance, or the kind of processes that are more collective, are undermined. Because the individual belief is not enough. We need to be aware that we are all on the same page, as you said.
Janet Bush: And the second thing that you point out is human security. You say that people need to have legitimate and natural human security ambitions without protectionism. What do you mean by that?
Pedro Conceição: It goes back to the contention, I guess, that perceptions of insecurity are the root of some of the challenges that we typically identify as being behind the gridlock. For instance, I already alluded to the fact that the more insecure people feel, the less they feel in control of their lives. The more insecure people feel, the less empowered they feel, the less agency they perceive as having.
Secondly, the more insecure people feel, the less they trust others. We often invoke lack of trust as one of the challenges that we confront in enabling societies to come together to address the challenges or, in the international community, lack of trust between countries.
A lot of it—obviously not all of it, but part of it—has to do with perceptions of insecurity. There’s at least this correlation between people feeling more insecure, trusting others less.
And then third, the more insecure people feel, the more attracted they are to the extremes of the political spectrum. It’s not an ideological thing of left and right. It’s if you feel insecure, you’re attracted to more polarized views, more polarized political views. And there are different ways that account for this behavior. But one has to do with the fact that when people feel threatened, they tend to retreat to sort of the in group.
These psychological and social psychology processes that work in the background, in a sense, and are often not very much the focus of policies, are very important to recognize and understand. It’s in this sense that we put a lot of emphasis on this notion of addressing security—not in the sense of territorial security as such, but more this broader notion of human security, the importance of people to live.
Our own definition of human security is people that are free from want, free from fear, and free from living in indignity. It’s important to achieve that without protectionism, because protectionism is not the solution when we face the interdependence that I alluded to earlier, right?
So, yes, there are many things that countries can do and need to do within their borders. But there are many others that require countries coming together internationally.
Janet Bush: The third thing is the big one. You say that you need a 21st-century architecture to deliver global public goods. I’ve heard this before, and it’s been suggested many times. How feasible is that in a polarized world?
Pedro Conceição: It’s difficult, but I think our argument is that one needs to draw a distinction between the fact that countries will have their differences, will compete with each other, will have different priorities, will compete on technology, will compete on territorial security, obviously.
But that is not incompatible with the notion that countries can find areas in which they can come together to address these challenges, in which there are interdependencies. The two are not mutually exclusive. Of course polarization—and that’s the whole point of the report—makes it more difficult, but not impossible.
I think the important message in this argument is also the notion that countries do not need to solve all of their differences to agree on the provision of these global public goods. Conflict is a part of life. Conflict will persist. Competition will persist. That’s not going to go away.
But that’s not incompatible with the notion that countries need to come together to address the next pandemic or to address climate change. And it’s happening to some extent. Again, not with the speed, not with the intensity that we would like to see. But it’s well documented in the press that, for instance, the United States and China do cooperate when it comes to climate change. Recently at the United Nations General Assembly, there was a resolution passed on artificial intelligence, proposed by the United States, supported by China and many other countries.
So there are arenas in which countries can come together. And what we suggest in the report is that this lens of global public goods makes it concrete so that it doesn’t stay at the level of something aspirational and utopian about achieving something like world peace, which we all would like to have. But it makes it very concrete.
It’s about global public goods such as climate change mitigation. It’s about global public goods such as communicable disease control or pandemic management or the management of misinformation or mitigating the risks of artificial intelligence. It’s possible to find arenas in which countries can come together.
We use this expression of architecture because it requires, also, allocation of resources. And potentially, or surely, transfer of resources from rich high-income countries to low- and middle-income countries, but transfer of resources that are not driven by the motivations that are behind some of these transfers that are often related with humanitarian emergencies, saving lives or traditional development assistance.
These are very important. And we need to continue. We are not doing enough on these two dimensions, but we need this third dimension, which is if we’re asking a low-income country to do something on behalf of the international community to provide global public goods, of course the country itself benefits.
But because it’s providing, also, gains to the international community, it needs to be supported, at least in the incremental effort that it’s undertaking on behalf of the international community beyond the benefits that accrue to the country.
Janet Bush: Just this year, we at McKinsey came up with this barometer, the global cooperation barometer. And it looked at five aspects of global competition: trade and capital flows, innovation and technology, climate and natural capital, health and wellness, and peace and security. Lots of the things that we’ve been discussing.
The inaugural barometer showed that the cooperation had been rising for ten years. But it stalled. Almost mirroring what’s happened with the Human Development Index, in a way. How can we kick-start that cooperation? What would it look like?
Pedro Conceição: I think that one of the contributions that the report is aiming at making is to try to be more precise about—of course, it would be ideal to have cooperation on everything, right? And I think that’s a little bit the angle of the cooperation barometer that McKinsey has done.
Yes, it would be good to cooperate on anything. But if it’s difficult because of this context of polarization, geopolitical upheaval, to cooperate on any dimensions, what are those on which international cooperation is not only desirable but unavoidable? Because again, we can calibrate some of the cooperation we make with decisions on trade, for instance, or capital flows. And there are many considerations that go into this. But when it comes to sharing a planet, there’s really not a choice.
Global public goods provide a lens and an analytical set of tools that enable us to draw, perhaps, a clear distinction where we need to absolutely come together, and those areas in which coming together would be good, it’s desirable but perhaps not as essential.
Janet Bush: Yes, so it’s about mutual self-interest.
Pedro Conceição: It’s about mutual self-interest. And it’s about identifying issues that are not zero-sum, right? It’s about identifying those issues in which negotiation doesn’t really come into play. Because all countries benefit.
You know, in the language of economics, these global public goods are non-rival and non-excludable at the global scale. Now, it’s challenging to get there, and the report has many things to say about how to get there. And part of it has to do with having to find different categories of global public goods. They have different ways in which countries need to come together to provide for these global public goods.
But at the higher level, it’s important first to recognize and identify what these global public goods are, see in which category they fall, and then understand what are the incentive structures that we need to put in place—in the form of treaties, for instance—that enable this delivery to take place. What kind of resource allocation, of course, or what kind of international transfer of resources we need to put in place to enable them to happen.
Janet Bush: I want to draw to a close with a sort of looking back, perspective on your work with human development. When you look at what’s happening today and the challenges we face, how does that sit in the context of the many years that you’ve been committed to human development?
Pedro Conceição: First of all, what we have observed over the last three, four years has been a disruption, quite unexpected. We are also victims of this uncertainty complex. And that’s why the human development reports, certainly the last two perhaps, veered towards territory that’s a little bit more alien to development reports, I guess.
Some of the topics that we discussed, Janet, are typically not the subject of a development report or reports coming from international organizations. The reason, to summarize it, is that we need to rebalance reports and analysis that focuses on the “what.” Because we know a lot about the what. Many of the reports are giving recommendations to countries on what they should do. And that’s important.
But what we’ve realized is that we need also to put emphasis on the “how.” Often we do know what needs to be done. We don’t need necessarily another report telling us that, you know, the way to mitigate climate change is through a just energy transition. I think we all understand that and actually have the means and technologies to do that, for the most part—perhaps not everything, but certainly renewable energy, solar, wind are accessible, are cheaper in many cases than production of energy from fossil fuels.
The solutions are there, in a sense. It’s less about, or along with, the search for solutions; it’s about understanding what’s standing in the way of us coming together. That has been a shift that has led to some unsettledness also in the work we do and in the direction that our reports have been taking.
Janet Bush: I don’t want to end on a pessimistic note. So give me a cause for optimism.
Pedro Conceição: Well, I think that optimism is about a belief about what’s likely to happen. But what we argue is that it’s important to be hopeful. I’m paraphrasing Václav Havel, who said to this effect: being pessimistic or optimistic is an assessment that one makes about what’s probable.
Hopefully it’s about fighting for something we want to happen. And so even if you are pessimistic, you should still be hopeful. Because you should still be fighting for that world that we all aspire to.
We also use in the report the expression a “possibilist agenda.” It’s not about being optimistic or pessimistic, but seeing that there are possibilities, that there are things we can do. Whether we’ll do it or not takes us into the territory of being pessimistic or optimistic. But it starts with, in our view, a possibilist agenda driven and inspired by hope.
Janet Bush: The art of the possible and hope, two very good things to end on. Thank you so much for joining us, Pedro.
Pedro Conceição: It was a pleasure, Janet. Thank you for having me.
