Part I — The reshaping of finance
Happy New Year. This is a time where we look back, we plan for the next year, and, at times, we make promises to ourselves. Typically, the promises cover things such as eating healthy, getting more exercise, taking care of our family, being more generous, etc. Statistically, we know from our subscription services businesses in health and wellness, that January is, by far, the biggest month of the year for investing in health and wellness services.
We all have good, well-meaning intentions to live a proper life and to take care of ourselves and our nearest and dearest. Rational people know that it is good for them. It enhances longevity, to eat better and get more exercise. But what happens when we cannot even keep a simple promise to ourselves? What happens when we need to look after the 2nd- and 3rd-order consequences of our actions? And not just the consequences to ourselves.
Modern economic theory has taught us that taxes, or reallocation of economic resources, is an efficient way of changing behaviour. The behavioural changes are often induced by combining these tools with regulations, implemented through laws and directives. If you look at the largest industries in the world — Energy, Insurance, Pensions, Banking, Real Estate, Tourism, Transportation, Pharma, Chemicals, Telecoms, Education…
