The New Paradigm Papers of the Month of December

Once a month the Forum New Economy is showcasing a handful of selected research papers that lead the way towards a new economic paradigm.




6. DECEMBER 2023



Towards a Public Sustainable Finance Paradigm for the Green Transition

Philipp Golka, Steffen Murau, and Jan-Erik Thie

The discourse on “sustainable finance” within the context of the Green Transition is a prominent subject in academic and policy discussions. In this debate, private for-profit investments often overshadow the role of public investments. This paper critiques the current understanding of sustainable finance, highlighting its limitations, including an overestimation of the impact of private capital, reliance on outdated economic assumptions, and a misunderstanding of institutional constraints. The authors propose a paradigm shift towards “Public Sustainable Finance,” placing the state at the forefront and advocating for a comprehensive approach that includes direct public investments. The authors use the case of Germany to illustrate how a Public Sustainable Finance paradigm can be implemented even within existing fiscal constraints, offering pragmatic solutions to address the urgency of the climate crisis.



Top Wealth and Its Historical Origins An Analysis of Germany’s Largest Privately Held Fortunes in 2019

Daria Tisch and Emma Ischinsky

This study examines the historical dynamics of wealth concentration, shedding light on the origins, entrenchment, and interconnections within Germany’s wealthiest individuals. With wealth concentration and economic power in the hands of a small elite, the research introduces the concept of “entrenched fortunes” (fortunes which date back to the early twentieth century) and compares them with more recently established ones. Analyzing a 2019 rich list of 1,032 German fortunes, the study finds over one-third associated with companies founded before World War I, with 8% descending from the same families. Despite historical upheavals, entrenched fortunes rank higher on the wealth list than newer ones. Owners of these entrenched fortunes are often connected through marital lines and kinship, hinting at social closure at the top. The findings indicate that the accumulation and perpetuation of fortunes over many generations is an important feature of top wealth in Germany.



Government Redistribution and Development Global Estimates of Tax-and-Transfer Progressivity, 1980-2019

Matthew Fisher-Post and Amory Gethin

This article addresses the critical gap in understanding the distributional effects of government taxes and transfers worldwide, especially in the developing world. Utilizing new data and methods, the study establishes a comprehensive database on the distribution of taxes and transfers in 151 countries since 1980. The findings reveal five key stylized facts on global fiscal progressivity, highlighting the significant impact of transfers in reducing inequality. The study also examines the relationship between redistribution and economic development, providing insights into the dynamics of fiscal policies across countries. Overall, this research contributes to bridging the gap in comprehensive post-tax income distributions and offers valuable insights into the effectiveness of global fiscal policies in reducing inequality.



Populist Leaders and the Economy

Manuel Funke, Moritz Schularick, Christoph Trebesch

Populism has reached unprecedented levels globally, with over 25 percent of nations currently being led by populist figures. This study investigates the economic performance under populist leadership by constructing a new extensive cross-country database spanning from 1900 to 2020. The analysis identifies 51 populist presidents and prime ministers and reveals a substantial economic toll associated with populism. After a 15-year period, GDP per capita is found to be 10 percent lower compared to a plausible nonpopulist scenario. The study highlights a correlation between populist rule and economic disintegration, declining macroeconomic stability, and the erosion of institutions.




After decades of overly naive market belief, we urgently need new answers to the great challenges of our time. More so, we need a whole new paradigm to guide us. We collect everything about the people and the community who are dealing with the question of a new paradigm and who analyze the historical and present impact of paradigms and narratives – whether in new contributions, performances, books and events.