Commentary: Today’s World Economic Order Isn’t

There are moments when economics stops pretending it is a science of gentle curves and instead reads like epic poetry. According to Martin Wolf, chief economics commentator at The Financial Times, we are living through one of those moments now – a rupture unseen in 70 years.

The old spellbook of democratic capitalism, free trade, open borders, and liberal democracy no longer reliably works its magic. And as Wolf reminded the room at the recent EFMD Deans Conference in Vienna, with a line that deserves to be carved into marble and syllabi alike: Nostalgia is not a strategy.

The keynote was less forecast than frame. It was a way of seeing the world clearly when the noise is deafening. For poets and quants alike, it offered structure without illusion and numbers that tell a story darker and stranger than the charts suggest.

I. The Certainties The Gravity We Cannot Escape

Wolf began with what feels paradoxical in uncertain times: the near certainties.

Demography is destiny, and destiny is aging. Population growth is now concentrated almost entirely in Africa and South Asia, while China, Europe, and much of the developed world face fertility collapse. Forty-one percent of humanity already lives where fertility is below 1.5. This is not a scenario. It is baked in.

Technology accelerates relentlessly. Gordon Moore, co-founder of Intel, once imagined thousands of transistors. Today AI chips carry trillions. The same exponential curves bend downward in clean energy costs. Progress is not slowing. It is compounding.

Growth is the default setting of the world economy. Since World War II, global output has risen almost every year, producing a fivefold increase in GDP per head. Crisis years 2009 and 2020 stand out precisely because they are so rare. The machine keeps running.

Economic gravity is shifting East. China’s meteoric ascent is cooling, but the larger arc from West to Asia remains intact, with India and others inheriting the momentum.

And finally, the planet will get warmer. We are already at 1.5°C above pre-industrial levels, and nothing in current politics suggests decisive reversal. This too is not conjecture.

These are the constants in the equation. Everything else is volatility around them.

II. Why the World Hasn’t Broken Yet

Given this backdrop, why does the system still hold?

Wolf points to three stabilizers. First, the sheer inertia of growth itself. Second, the astonishing scale of private investment in AI by cash-rich technology firms racing ahead of consensus. And third, a more ironic force, what his colleague dubbed TACO: Trump Always Chickens Out.

History suggests that incendiary rhetoric often resolves into more moderate policy. Markets, ever pragmatic, have learned to price the gap between threat and action.

Resilience, then, is not optimism. It is momentum.

III. The Fragilities Where the System Can Still Fracture

If the certainties are geological, the fragilities are tectonic.

Liberal democracy is in trouble, especially at home. In its heartlands, law is increasingly treated as an instrument of power rather than something that stands above it. This shift, Wolf warns, strikes at the moral and institutional core of the Western order.

Geopolitics is heating up. Ukraine and Gaza are not anomalies but signals. Personalized power raises the risk of escalation and history teaches a grim lesson: wars are far easier to enter than to exit.

Finance is swirling. Public debt ratios in advanced economies now exceed post-WWII levels, but without postwar growth prospects. Add persistent fiscal deficits and fragile banks and you get a system that is stable until it isn’t.

For quants, this is tail risk. For poets it is tragedy foreshadowed.

IV. The Long Slowdown

Beneath the daily drama lies a quieter shift: structural deceleration.

Aging populations drag on growth. The great era of catching up to China’s once-in-history leap may be over, with no clear successor. And globalization – once underwritten by benevolent hegemony – is fraying. Trade in goods is already retreating. Protectionism waits in the wings.

Europe, Wolf implies, is especially exposed – too open to ignore geopolitics, too slow in growing to absorb shocks easily.

V. The Two Revolutions That Change Everything

Against this gloom stand two forces large enough to bend the trendlines again.

Artificial intelligence is the first technology that threatens to subvert not manual labor but elite cognition. The very people business schools educate – analysts, strategists, managers – sit closest to the blast radius. Productivity may soar, but so may social instability.

Clean energy, meanwhile, is undergoing its own quiet miracle. Solar batteries – and perhaps fusion and quantum breakthroughs – promise a radically different energy system. Not fast enough to save us from near-term climate pain, but powerful enough to reshape the long run.

Together, these revolutions are unsettling, exhilarating, and deeply political.

What This Means for Business Schools and for Us

Wolf’s challenge to academic leaders is unambiguous.

1. Rethink what it means to be skilled. When machines think, human value shifts toward judgment, creativity, ethics, and adaptability.
2. Teach geopolitics as strategy, not background noise. Power borders and rivalry now belong at the core of business education.
3. Defend democratic norms. Markets rest on the rule of law. When law bends to power, prosperity eventually follows.

Coda After the Rupture

The world economy is a machine for growth, Martin Wolf says. But machines require maintenance and sometimes redesign.

For the quant, this keynote was a warning about assumptions embedded too deeply in models.

For the poet, it was a meditation on a world caught between memory and mutation.

And for everyone in the room it was a reminder that the future will not rhyme with the past – no matter how comforting the old verses sound.

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Benjamin Stevenin is the former Director of Business School Solutions and Partnerships at Times Higher Education.

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