Is the world zero-sum or win-win?

Zero-sum thinking is back in vogue. After a geopolitically challenging year, relationships between great powers are increasingly cast in stark “if they win, we lose” terms. This has been seen most recently in the stand-off between Russia and NATO over Ukraine. However, in 2011 the journalist Gideon Rachman had already observed three sources of increased zero-sum thinking: slower economic growth; growing rivalry between the United States and rising powers, in particular China; and the clash of national interests in the search for solutions to global challenges such as climate change, nuclear proliferation, and failed states. He concluded: “A win-win world has been replaced by a zero-sum world”.

Is this true? Has the world become zero-sum?

Economics was one area where zero-sum concepts were historically well entrenched. For centuries mercantilists believed that wealth was found in zero-sum holdings of land and gold.   Yet, by the 19^th century, the concept of comparative advantage supported a growing belief in free trade, later reinforced by the disastrous experience with protectionism during the 1930s.

Prosperity: a win-win game?

This belief has been questioned by some due to the rise of Japan in the 1980s, of Germany in the 1990s, and of China and other emerging economies since the turn of the century. However, the evidence shows that economic integration continues to provide benefits that are broadly shared across nations. Over the last 20 years, all G7 economies increased their per capita income. Almost three-quarters of the increase in each country was due to a common improvement in prosperity. Only 27% was due to a change in the relative prosperity of the countries.

Globally, the positive impact of the freer flow of goods and services is being augmented by the fast flow of ideas and innovation. Growing global economies of scale, particularly in ICT and mobile, are allowing companies to make massive investments in new products and services that benefit consumers around the world. This is particularly true in online products and services where the cost of serving incremental customers on a global basis is close to zero.

In education, the positive-sum opportunities are accelerating. Ubiquitous mobile access allows knowledge from any corner of the earth to be shared instantly around the world.  Wikipedia has transformed how we search for and share knowledge. Less than 15 years after its creation, this collaborative organisation has assembled 34 million articles, equivalent to 15,000 volumes of the Encylopedia Brittanica. Massive Online Open Courses (MOOCs), such as the World Economic Forum’s Forum Academy are allowing world-class education to be shared at a scale and with a global scope unimaginable a few years ago.

Facing global challenges together

Perhaps the most striking possibilities of a positive-sum world are in health. The recent Ebola outbreak has reminded us all how globally vulnerable we are to infectious diseases. Improvements in public health systems in developing countries reduce the risk for all health systems around the world. Innovations that provide high quality, low cost health in developing countries — such as inexpensive portable diagnostic equipment and the use of smart phones to deliver health services — are also improving health services in developed countries. As emerging economies face the same challenges of chronic diseases and aging populations as advanced economies, they may well develop some of the key technical and service model breakthroughs that help all nations address these growing concerns.

Economic growth, education, and health — the three key drivers of the Human Development Index (HDI) — are all positive sum. Therefore, it is not surprising that the world’s HDI performance has improved every single year since its inception in 1990. During that time, global life expectancy has improved by six years, extreme poverty has dropped by half, 6 million fewer children are dying before the age of five. Across the world income levels have risen while globally inequality (as measured by the global Gini coefficient) has dropped.

When others benefit, we benefit too

There are huge challenges today: slow growth; youth unemployment, environmental concerns; millions living in extreme poverty; extremist movements expanding their hold in fragile states. However, the actions to resolve all these issues are positive sum, not zero sum.  When others benefit, we benefit too.

Unfortunately, the zero-sum mindset persists amongst many theorists and leaders. The danger is that zero-sum thinking can lead to outcomes that are worse than zero sum. In most dynamic systems, the opposite of positive sum is not zero sum, it is negative sum. One of the causes of WWI was that its protagonists saw power and prosperity in zero-sum terms. The result was tragically negative sum. Every major participant in 1914 came out diminished: the Czar killed, the Kaiser overthrown, France with millions dead, the UK heavily indebted.

The great challenges today, from territorial rivalry to climate change, must be resolved in a constructively positive-sum fashion or they could become catastrophically negative sum. Zero-sum approaches will not lead to stable or positive outcomes. Given the dynamics of global challenges, working collaboratively is not naïve: it is necessary.

Author: Robert Greenhill is Senior Fellow at the Centre for International Governance Innovation.

Image: Joggers run past as the skyline of Singapore’s financial district is seen in the background April 21, 2014. REUTERS/Edgar Su.