<aside> 🛠 We never stopped Central Planning, we just outsourced it, an observation about UK infrastructure markets

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A website by Dr Steven J Steer

‘Economic Architecture’ is made up jargon

It is an attempt to summarise in a two word phrase the need to have a clear way of monitoring, planning and otherwise governing the centrally planned aspects of an economy, i.e a socio-economic system. I typically apply it to a national economy, but it can be applied in other places where governance is complex too.

The approach is based on the premises, that:

• the task of governance can be fully described as ‘using information to make and communicate decisions’ and the implication that efficient management of the information needed to carry out governance allows for good quality central planning; and
• to some extent the complex economy involves some ‘central planning’, where the economy’s central governing authority chooses to control at least part of the economy instead of leaving economic planning to free markets that feature no other central governing authority.
• modern economies have outgrown their incumbent ‘analogue’ operating models for governance due to their increased complexity, meaning a stronger role needs to be played by digital tools and data.

Economic Architecture itself is a designed way of organising the information needed to carry out central planning governance tasks. It impacts what information is available, how it is organised, who has it, how it is shared and agreements about who holds what responsibilities and how people work together. It can be thought of as setting the ‘operating model’ for the economy’s governance.

The more specific purpose of Economic Architecture is to improve the process of creating or adapting complex systems to meet techno-socio-economic challenges where existing governance methods are proving to be unsuited to the challenge. Economic Architecture is generally intended for use with respect to infrastructure-intensive economic sectors and/or public services as this is where central planning is most prolific. Typical ways in which existing (’analogue’) governance methods tend to demonstrate inadequacy include a sense of:

• a slow pace of change
• low confidence in plans for change
• an actor who has the legitimacy (authority, wherewithal and trust) to lead change
• repetitive renewal of strategy and direction
• implementation regularly falling short of aspiration
• weak accountabilities for past and future performance

It is typically assumed that the Economic Architecture method will be applied to national-level challenges, or equivalently complex systems. For simpler systems, this could be described as ‘using a hammer to crack a nut’.

Economic Architecture is an emerging approach for facilitating agreement, design and delivery of change to centrally planned services in new and existing complex systems. Its certainly a lofty aspiration, especually as it seeks to enable society to do things like ‘progress to its next epoch’, but it’s good to dream and set your sights with an ambitious target, providing you stay pragmatic day-to-day.

Definition of key terms

You could argue that any economic system has an implicit Economic Architecture. This site is concerned primarily with establishing best practice methods for helping cases where that Economic Architecture is arrived at through a central plan, rather than from markets that have no official centre.

EconArchIntro.mp3

• Citations

A simple picture to begin unpacking key concepts. Many architecture methods are described using layers and this is no different. The high-level layers are outlined in the image, below.