The Colours of the Economy

by Terence Hogarth

From numbers to colours

Economic statistics broken down by sector and compiled using stringent classifications have long provided the main basis for describing the economy. For instance, NACE (Nomenclature of Economic Activities), is the European classification of industrial sectors. Statistics compiled according to NACE, such as employment by sector, are vitally important, but they do not tell the whole story.

It is apparent that other than through complicated input-output tables it is difficult to gauge the way in which sectors engage and intermingle with one another from sector-based statistics. And because classification systems take time to amend - NACE Rev 2 was introduced in 2008 and updated in 2022 - there are always likely to be concerns about how well they capture changes currently taking place in the economy. There is also a need to bear in mind that strict classificatory systems may not fully capture the nuance or the importance of changes which take place within and between sectors.

This is where the ‘colours of the economy’ can complement information based on strict classification systems of economic activity. That they are a complement rather than a substitute should not be under-emphasised.

Why describe the economy in colours?

Artists use colour to elicit emotions. Similarly, writers use colour to evoke feelings and add layers of interpretation and complexity to their stories. In similar ways, colour is more and more used to describe the economy. It is now commonplace to talk about the green economy, the blue economy or the growing silver economy. And reference is increasingly made to the white, yellow, gold and orange economies.

Colour can arouse sensitivities about the economy. There are, for instance, fears that left unchecked the world’s addiction to mass consumption will push countries further into the red, a colour that has symbolic associations with danger, heat, and debt. It might be said that the black and grey economies, drained of colour, express disapproval not least because of their links to exclusion and illegality.

A single colour can have a pure form. It can also have a number of shades which suggests something about its intensity. Colours also mix with one another. Starting from red the colours of the spectrum merge from red to orange, yellow, green, blue, indigo and finally violet. There are no clear boundaries. Primary colours can be mixed to produce new secondary ones. Colour is mutable. And so is the economy and the sectors within it.

The colours of the economy convey much about change where colour intensifies or fades, or where it merges into another for example where the green economy merges into the blue one and vice versa. A specific sector of the economy, say the white one, might contain a splash of yellow or orange indicating the way in which creativity and technology cut across traditional sectors of the economy. Colour provides a flexible tool to describe economic change and the interconnections within it. But what are the key colours of the economy?

The colours of the economy

Colour is used to succinctly reveal something about the economy which might be otherwise obscured. The concept of the green economy has its origins in describing activities designed to mitigate or reverse environmental degradation and to facilitate achievement of the net zero ambition. But increasingly, it also includes actions to bring about a just green transition that will produce sustainable growth, reduce poverty, and increase social inclusion. The use of colour here allows a nuanced rather than a rigid interpretation, which enables, at the very least, increased consideration of the way in which sustainability and social justice are inextricably intertwined.

In the same way, the blue economy, at face value might be seen simply as activities linked to the sea and major inland waterways. But blue, in relation to water, might also evoke, in some, a vision of crystalline clear, relatively still, azure waters brimming with healthy sea life. In so doing it reveals something about individuals’ collective preferences about what should be the goals of the blue economy. It pushes the discussion beyond dry economic statistics into something much more interesting about what, in this case, the blue economy should look like.

Meanwhile, the brown economy brings to mind brownfield sites and the environmental degradation resulting from the release of pollutants and the emission of greenhouse gases. Brown, however, is also the colour of soil which is a source of life. Brown therefore also symbolises the potential for renewal if land can be decontaminated and brought back to life. Across the globe, brownfield sites are being reclaimed, put to new purposes and, in doing so, might even become greenfield sites.

Understanding more abstract colours of the economy

Green, blue, and brown are all associated with physical or earthly things such as sun, sea and soil. There are also more abstract concepts to consider, such as the white, silver, orange, gold and yellow economies.

The white economy is healthcare. It includes medical centres including hospitals, the pharmaceutical industry and the medical equipment sector. It reminds one of the white clothing typically favoured by clinicians and the white decoration of medical centres designed to show up dirt and potential contaminants. White is neutral and unspoilt. It conjures up associations with the pristine cleanliness of environments designed to control pathogens.

An adjunct of the white economy is the silver one. As people age there is a tendency for their hair to grey. Accordingly there is an association of silver with ageing if one accepts that silver is, from a colour perspective, a radiant form of grey. It indicates the positives attached to the ageing process. As people age they are likely to make increased use of health and care services, as well as leisure and other goods and services produced by the silver economy.

Orange, in antiquity, was associated with culture, creativity and identity. It is also the colour of fire – metaphors abound which refer to ‘creative fires’ in one way or another (Buitrago and Duque, 2013). Because of this, orange has become associated with the cultural and creative industries. In other words, the production of goods and services which have intellectual value rooted in culture and art. It is estimated that the orange economy accounts for around 3 % of global GDP. Increasingly, these goods and services are seen to make use of hi-tech. In this context, ‘STEAM’ is an increasingly important educational approach that incorporates the arts into the more-familiar STEM model of science, technology, engineering and mathematics.

Finance and IT are not only growth industries, but they are ones which act as catalysts for growth across the economy as a whole. Finance and IT generate colossal amounts of wealth reflected in the stock market capitalisations of banks and tech companies. This is the gold economy. Its name references the period when the value of a currency was linked to a country’s reserves of gold (the gold standard). As a catalyst, the gold economy is linked to every other sector. For example, it facilitates investment in, amongst other things, environmental change. Meanwhile, green finance is an increasingly important part of the policy mix to bring about improvements in sustainability.

The use of colours also allows new concepts and interpretations to emerge. The yellow economy is sometimes associated with the information economy, research and innovation (e.g. Santander, 2022). But we might also suggest that the ‘yellow economy’ be used to describe the economic activities taking place in a context of increasing desertification. Sand tends to be depicted on maps as being yellow and is also the colour of the blazing sun one associates with life in the desert. The yellow economy might be used to describe the variety of technologies, crops and processes that mitigate conditions of persistent drought or the solar energy which can be harvested. The importance of this yellow economy will only continue to grow if an increasing share of the global landmass becomes arid or semi-arid.

Towards a brighter (but not too bright) kaleidoscopic labour market

Colour provides an added dimension to any narrative about change in the economy or labour market. As a descriptor it reveals succinctly something about the importance and preferences which words alone cannot express. At is simplest dark, muddy colours might be seen as a bad thing (such as the black economy) whereas brighter colours might be regarded as good (for example, the green economy), but not to the point where they signify combustion.

Particular colours have become imbued with certain meanings which conjure up visions of some kind of ideal such as in the case of the blue economy. There are also considerations about how colours might be maintained (to avoid the colour being drained out of them) or intensified (becoming greener or bluer). There is also a need to think about the way in which colours merge into one another or through mixing create new colours. One colour may have a splash or swirl of another indicating the way in which one sector might permeate many others.

Not only do all the different colours of the economy need to play their part in bringing about a sustainable global economy they need to positively interact with one another. There are obvious links such as those between the grey and white economies. But there are other synergies too. Medical supplies, for instance, are greener when they are biodegradable. Activities in the orange economy can encourage older people to remain active (the silver economy) as well as providing a range of therapies to aid well-being (the white economy).

How you mix the colours of the economy to best effect to bring about a brighter kaleidoscope of colours is far from straightforward. The EU’s Green Deal demonstrates the manifold strands of development required to effectively develop just one colour of the economy.

It is evident that skill is and will be a key component of any policy mix. First there are the skills required to recognise the opportunities one colour affords another. Second there are the skills that need to be in place to realise those opportunities. Whether one can identify skill needs in advance through a foresight-type exercise – or even a moonshot mission – rather than rely on market signals, continues to dominate policy discussions.

When we speak of skills or human capital what colour comes to mind? After all, it is the production of human capital which is often a precursor to the achievement of nearly all the well intentioned ambitions policy makers across the world.

References

Buitrago, F. & Duque, I. (2013). The orange economy. An infinite opportunity. Washington:

Inter-American Development Bank IDB

Santander (2022) The Yellow Economy: How to get the best return from science and tech