The brain economy explained: Why strong brains power strong economies

Extractive Summary of the Article | Listen

As AI accelerates change across economies and workplaces, much of the focus has been on the technology itself. But new research from the McKinsey Health Institute and the World Economic Forum suggests that an equally important—and often overlooked—source of value lies closer to home: our brains.

The concept of the brain economy reflects a shift in how value is understood. Increasingly, economic growth depends not only on physical capital or digital infrastructure but also on brain health and brain skills: our ability to think clearly, adapt to change, collaborate effectively, and make sound judgments in complex environments.

Following extractive summary is from the transcription of the in which McKinsey’s Erica Coe, Jacqueline Brassey, Kana Enomoto, and Lucy Pérez explore what the brain economy is, why pressure on our brains is rising, how AI is raising the bar for human capability, and why investing in brain capital has become a clarion call for leaders, businesses, and societies.  The insights form the interview has been edited for length and clarity.

What is the brain economy—and why does it matter now?  The brain economy is really about one thing. Strong brains power strong economies. And so, increasingly, we’re seeing that value creation comes from what we can imagine, design, connect with our brains versus what we make with our hands.

Why are our brains under so much pressure right now?   If we think about the impact that the pandemic had on rates of anxiety and depression and other brain health conditions worldwide, we were already at a point of increased burden. Then you put on top of that the perfect storm that we’re facing right now of demographic, technological, and scientific change. Add to that geopolitical and economic uncertainty, an aging population, and the rising disease burden, and we’re talking about a real strain on our brains across the entire lifespan.

Brain health and brain skills—and why you need both.  Brain capital is the sum of brain health and brain skills. Brain health is not just the absence of disease. It’s also positive brain functioning: our cognitive abilities and ability to function in daily life. That’s the foundation. On top of that, there are skills we can learn starting at a very young age that will strengthen our mental capacity, give us more resilience, and even give us the ability to take on new situations and offset cognitive decline.

AI doesn’t replace humans—it raises the bar.  In the age of artificial intelligence, you need a concomitant investment in human intelligence. To take advantage of what AI is able to deliver for humanity and for our societies to be safe, cohesive, and thriving, we need humanity to work side by side with the technology, to understand what it’s getting, to be able to drive the direction, and to make ethical judgments of how to use that power and information.

The economic case for investing in brain capital.  Just by scaling existing interventions, we could reclaim 260 million years of healthy life and unlock $6.2 trillion in GDP gains by 2050. And that’s just by addressing the existing disease burden around brain health conditions. When you couple that with investing in brain skills and unlocking our collective peak brain performance, the value at stake increases even more.

What can leaders do today to help build brain capital for the future? Leaders have the keys in their hands. They can do a lot. Start by role modeling. This is really about intentionally and consciously making the decision to put brain health at the heart of how you run your business. And it starts with taking care of your own brain health and showing others how you do that.

What the future could look like if we get this right.  If we invest in brain capital, we can build societies that are more innovative, more resilient, and human centered.

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