Shifting Gears: Thriving in the New Economy

Barbara Lenes McLennan is a graduate economics student in Edmonton.

Nuala Beck hopes to take her place among the ranks of gurus who measure
the health of the North American economy and predict its future. Having
started her own Toronto-based consulting firm in 1984, she is making her
mark in the media with this best-selling, personality-oriented book,
which attempts to turn the “real world” economics profession on its
ear.

Beck’s basis thesis is that the 1980s, not the 1990s, were a time of
collapse of the manufacturing economy and emergence of high-knowledge
industries as the engines of growth for a new technological economy.
Problems today of bankruptcy, unemployment, and government mismanagement
are largely associated with the passing of the old, no longer central
industries. The new economy is driven by cheap semiconductors and
microchips, not the cheap energy of the previous manufacturing-based era
or the cheap steel of the commodity-based era before that. Consequently,
Beck has also developed 25 new financial ratios (some even trademarked)
to measure the progress of the new economy, 12 of which are described in
this book. Several tables and charts are included, the ones of most
interest being her knowledge ratio comparisons. The rest of the book
consists of advice to companies and today’s youth on how to adapt to
the future.

Beck mentions in her introduction that her ideas have been more
positively received in the academic environment than among her
competitors. In its own way, she repeats the call others have made for a
new paradigm in economic theory. She also raises tantalizing questions
about how the nature of work and the concomitant social structure will
change in this new era. However, the overall purpose of this book is to
promote Nuala Beck and Associates, not to create a consistent historical
theory of economic cycles. There are gaps in explanation that raise
inevitable questions: Is she talking about Canada or the United States?
Why start with 1850? What about the 1930s? How can this explanation be
understood to fit with the actual development of economic theory?

Ironically, even as Beck promotes her perceptions as “of the new
economy” (consultants rank a very high knowledge ratio), this economy
is still driven by the old motivation of production growth. It is also
still judged according to the Darwinian ethic, with the current
catchwords being “knowledge,” “smarter,” and “brighter.”
There is a resounding silence in this book as to the place of the
agnostic in the new technological economy.