Market Humanism

In a webinar at Oxford University on 5 March 2026, Eric Beinhocker and Nick Hanauer presented a new paradigm for the economic system to replace the failing neoliberalism. It places humans, ethics and values at the centre, and thus reflects many Bahá'í principles. It is rare to see such a coherent review of what is wrong with present economic assumptions and thinking, and coherent proposals for a better alternative. Here is a summary of some of the key points based on the webinar presentation, for which a recording is available. A brochure on the proposal is linked below. A book is due to be published later this year.

Is there an alternative to the failed orthodoxies of neoliberalism or the chaos of economic populism? Yes, according to Oxford economist Professor Eric Beinhocker and technology entrepreneur and civic activist Nick Hanauer. A new paradigm is emerging that they call ‘Market Humanism” which has the potential to reshape our economy and our politics. We are in the midst of a change in the global economic paradigm. The neoliberal consensus dominated policy, politics, business, and academia from the 1970s until it collapsed in the 2008 financial crisis. Since then, we’ve been living in a paradigm vacuum that has been filled by economic populism and the politics of grievance. This paradigm vacuum is not only a threat to democracy and the geopolitical order but also prevents us from addressing critical issues such as climate change and the rise of artificial intelligence.

Beinhocker and Hanauer provide hope by synthesising across a wide range of work from modern economics to philosophy, behavioural science, anthropology, sociology, political science, complex systems theory, evolutionary theory, computer science, and other fields. They assemble the pieces of what a new, and better, economic paradigm might look like. They call this new paradigm, ‘Market Humanism’ - an economy built for human flourishing and an economics built on 21st century science. In the webinar they described what Market Humanism is, and how it has the potential to change our thinking on policy and business, how it might re-configure our politics, and new narratives that can engage the public. They concluded with a discussion of the opportunities and challenges of moving towards a market humanist economy.

They start by defining an economic paradigm with a "stack" that ranks theories and practices, and their explanations, by levels. At the moral level there is moral philosophy and cultural norms that define the purpose of the economy and "good" or "bad" in the system.

At the level of scientific explanations, there is behavioural theory concerning human motivation and decision-making; economic systems theory about economic interactions and collective system behaviour; theories of value explain economic value and how it is created; the process of progress including theories of how the economy innovates and changes over time; and metrics for measuring economic performance and change.

Normative prescriptions include political economy about how markets, firms and states should be organised, and how wealth and power should be distributed; policies and practices that would make the system perform better; and public narratives that explain how the system works and how it could perform better.

They explain how the neoliberal consensus was a coherent stack, and then ask if modern economics build a new, better stack. This requires incorporating many other domains. At the values level, this would be moral philosophy, moral psychology, political philosophy, and faith traditions. The scientific level ranges across modern economics, behavioural economics, psychology, cognitive science, complex systems theory, network theory, evolutionary theory, computer science, sociology, political science, anthropology, and history. The normative level would draw on modern economics, political economy, institutional economics, public policy, law, business, social change practitioners, and narrative arts.

At the foundation of the new economy is the realisation that price and value are not the same thing. Real value is "solving human problems". Price is a socially-constructed signal for economic coordination, but does not always reflect value to individuals or society. Value comes from solving problems to create "fit order". Humans create order in their physical and social environments. Value is generated when we create order that serves a function (meets needs and wants) and is fit for purpose. Prosperity is the accumulation of solutions to human problems. Prosperity grows as cooperation grows to solve more complex problems. We can measure "solutions to human problems" via quality of life and wellbeing proxies.

Markets require trust to operate effectively. They should solve problems not create them. They should be aligned with societal interests.

Market humanism sees three kinds of regulation as value enhancing. First are laws and regulations that produce trust, which is essential for the large-scale cooperation “with strangers” required to create significant economic value. Second are laws and regulations that require individuals and firms to limit and take ownership of the problems they create. True economic value is created when we solve more problems than we create. When individuals or companies dump problems they create back onto society, it is value-destroying, and government needs to step in to constrain problem-creating behaviors. Third are government actions that align markets with societal interests. When markets are aligned with solving human problems, they are one of humankind’s most powerful inventions, contributing to enormous increases in well-being. But when they are misaligned, they are equally powerful and can lead to socially destabilizing wealth inequalities, exploitation, and environmental destruction.

Markets, states and civil society are part of a larger ecology of institutions that enable human cooperation and problem solving. They are not in zero sum competition. Each has a role to play and solves different kinds of problems for society. Each depends on the others. Markets and private sector organizations are essential for solving certain kinds of problems, but they cannot and should not solve all of our problems.

Inequality is an emergent phenomenon of markets when there are sources of asymmetry in the economy like hierarchy, class or race; there is path dependence where history matters; and there are compounding processes like power, social networks or return on capital. Markets tend to produce high inequality, and then there is re-levelling through mass warfare, revolution, state failure or lethal pandemics.

Large middle classes are the result of policies such as expanded access to education and housing, the wealthy paying their fair share of taxes, workers are empowered, financial markets are regulated, and there are improvements in public goods. The neo-liberal consensus dismantled policies, there was wage stagnation and middle class shrinkage, with growing plutocracy and lost economic dynamism.

Inclusion and fair social contracts are foundational to prosperity. There are economic, social and environmental dimensions of inclusion. A virtuous cycle of innovation and demand goes from reciprocity and fairness, cooperation and trust, and problem solving, leading to prosperity, and on to inclusion. From inclusion at the centre, demand and innovation form the next level, and the outer ring goes from higher wages, more purchasing power, higher standard of living, higher social trust and cooperation, increased business opportunity, more entrepreneurship, to more innovation, and a more stable and prosperous nation.

The policies that work are those that empower workers through living wages, collective bargaining, worker mobility, job guarantees, worker classification, paid leave and benefits, worker education and training, and labour standards in procurement. Then there is investment in the public good such as transport, digital, energy, housing, education, health care, and community. To make markets competitive requires anti-trust reform, merger guidelines, patent reform, small business support, and public options. Then to make markets strategic will need strategic trade policies, modern industrial policy, supply chain resilience, mission driven innovation, capability clusters, and a talent strategy.

All this means aligning corporate interests with human interests. Instead of the neoliberal consensus where corporations serve only shareholders, in market humanism corporations solve problems serving individuals and society, as with b-corporations addressing the environment, community, customers, workers, and governance. There is potential with artificial intelligence, social media, the clean energy transition, health, democracy, and creating a circular economy.

The brochure includes a much more detailed critique of the failing neoliberal paradigm and the market humanism paradigm to take its place.

SOURCES: Webinar on 5 March 2026 https://www.oxfordmartin.ox.ac.uk/videos/market-humanism and
Brochure: Markets Built for Humans: Creating an Economy for People, Planet, and Democracy https://oms-inet.files.svdcdn.com/production/files/MarketsBuiltForHuman…
This IEF summary.