Building an inclusive economy

• Author: Katrín Jakobsdóttir
• Position: Prime Minister of Iceland
• Pages: 12-13

POINT OF VIEW

AS GOVERNMENTS ARE slowly turning their focus

from raw GDP-driven measurements toward

well-being criteria when judging economic success,

the demand for progressive social justice policies

is increasing. is is why ma ny policymakers are

examinin g how Iceland, which enjoys a relatively

strong economy, has made gender equality a core

part of its domestic and foreign policies.

e campaign for women’s equality in Iceland ha s

demanded government action to liberate women

from social structures that have kept them down

for centuries. is includes legislative changes

for women’s sexual and reproductive freedoms as

well as robust equalit y laws and gender quotas for

corporate boards.

But it has also required policies t hat are, in con-

ventional economic terms, considered extremely

expensive. And the price tag s till prevents many gov-

ernments from adopting them. e key topics here

are universal ch ildcare and shared parental leave. If

applied properly, these policies have the potential to

change the mak eup—and the rules of the game —

of both the public and the private spheres. Why?

Because they enable women to participate in the

labor market and public decision-making, while

making space for men to sha re domestic responsi-

bilities. Yet these family-friendly policies have not

won the global support they deser ve and are seen by

many as a vast opening to profli gate public spending.

Fifty years have elapsed since Robert Kennedy

rightly said that GDP measu res everything except

that which makes life worthwhile. Economics

is nonetheless still centered on the measurable,

dividing government outlays into two categories:

expenses and investment. is dualism classifies

money spent on physical infrastr ucture as an invest-

ment and, therefore, worthy of public monies. On

the other hand, social infrastructure is branded

as expenses or operatin g costs, preferably the first

in line to be cut. Yet these are the structures that

sustain us from ( before) birth to death and create

the conditions that make life worthwhile.

Interestingly, physical infrastructure—roads,

tunnels, building s—is often the platform for men’s

employment, while women are much more likely

to be employed in services associated with social

infrastr ucture—educat ion, childcare, health ca re.

By focusing on physical infr astructure to the exclu-

sion of social infrast ructure, economists and poli-

cymakers ig nore an obvious truth: we need both in

order for our societies to thrive and develop. What

is a school building worth w ithout quality educa-

tion for all? What is a hospital building without

the people providing the health ca re? And what is

the value of a road or a tunnel in a society where

illiteracy prevents social mobility?

Building an Inclusive Economy

Iceland’s prime minister discusses what gender means for

rethinking the economy

Katrín Jakobsdóttir

COURTESY O F THE OFFI CE OF THE PR IME MINIS TER OF IC ELAND

POINT OF VIEW

12 FINANCE & DEVELOPMENT | March 2019