Economy of the Future: Space Economies


The 20th century was believed to be a fight for equality and was home to conflicts between opposing political and economic viewpoints. The 21st century, on the other hand, is a quest for technological innovation. From the Space Race in the past century, to a possible “Artificial Intelligence Race” in the coming years, our lives are destined to be altered by new inventions and scientific discoveries. Considering the ongoing pandemic, the development of AI, globalization, the dominance of things all-Internet and all-digital, novel space missions, and the ecological crisis, change is absolutely inevitable.



S p a c e E c o n o m i e s


The space industry - which was famously subject to a heated competition between two of the world’s most powerful nations (the USSR and USA) in the middle of the last century - is definitely here to stay. But according to a 2008 report for NASA by Oxford Analytica, the space industry is likely to move from “prestige" to "necessity.” (1) Space mining - using moons, planets, and asteroids to extract raw materials - may rise as a new norm in the coming decades. Self-sustaining and independent colonies (either on the moon or on planets in the Solar System or beyond) will need to rely on resources in space in order to function. For example, water from the Moon may be divided into oxygen and hydrogen, the latter being used to re-fuel spacecrafts, eliminating the need to receive fuel from Earth. (2) (3) Alternatively or simultaneously, materials mined and extracted from space may also be delivered and provided for use on Earth in a so-called “space-for-earth” economy. (4) With the Moon and asteroids being the primary targets, space is home to materials like water, ice, and metals. These materials may be transported to Earth to be used in the production of technologies and may improve our lives if used in healthcare, security, and education.


The potential introduction of new materials to Earth may allow completely new technologies to be produced or previously ‘impossible’ scientific pursuits to come to life.


Additionally, so-called “rare earth” materials are also potential targets for asteroid miners. Elements like lanthanum, neodymium, and yttrium are crucial in the manufacturing sector, yet the majority of them are mined in China via environment-harming procedures. (2) Their availability on asteroids may mean a more sustainable and environmentally-friendly economy on Earth, since we will no longer exploit our own land to extract these materials (however, we will, ironically, exploit asteroids). Therefore, the possibility of switching from using fossil fuels to using materials from space exists.


This ‘space-for-earth’ economy that may come to dominate may alter the way we calculate economic measures like GDP and confuse our understanding of the import / export system. Imports will no longer be materials coming from other countries on Earth, but from space itself. GDP may begin taking into account goods produced by a nation on Earth, as well as the goods produced by its space colonies. Space colonies may even have their own GDP’s. Additionally, settlements in outer space (either on celestial bodies, like planets or moons, or simply onboard large spacecrafts) may become completely independent without being affiliated with any nation on Earth, providing the possibility for new trading partners. This may also lead to the establishment of new countries in space, as well as new citizenships / nationalities, and even cultures.


Although the Space Race may eventually be replaced by space economies that are governed by necessity, a ‘race’ of a different kind is still possible. Countries may begin competing for land on planets, asteroids, and moons (due to these celestial bodies’ availability of resources and, therefore, their desirability). This could mean that countries with access to these space resources will be considered more powerful economically and politically, as well as more prosperous and affluent, than those without or with limited access to space resources.


Commercial space travel (space tourism) may also become a major player in a future economy. Not only may it facilitate transportation and communication between earthly and space settlements, but aid the economy by triggering government and consumer expenditures, business investments, and the creation of new jobs, which, in a market economy, are viewed as seeds for economic prosperity. According to Chris Lewicki, chief executive of Planetary Resources (an asteroid mining company), commercial space flight will become “a multi-trillion dollar industry” in our lifetimes. (5)


Space technologies are generally viewed with a positive attitude. According to the Organisation for Economic Co-operation and Development, space technologies have the potential to aid social wellbeing and "sustainable growth in the post-COVID-19 pandemic recovery." Space technologies can also create more equality by “bridging the digital divide,” aid the ecological crisis by monitoring climate change, as well as create “new economic opportunities.” (6)


For me, the rise of space economies is a sole continuation of humanity’s millennia-worth of exploration, territorial expansion, discoveries, and innovation. As our technologies mature, so will our aspirations at a worldwide scale, yet the most basic principles will remain true regardless of the time period. Humans will almost always, one way or another, interact with the surrounding environment (a natural or artificial one), compete with other parties, solve existing problems, seek out knowledge, and advance intellectually. Economics is the study of the efficient allocation of scarce resources, and these universal principles persist both in space and on Earth. Our economic laws may change, but their ‘root cause’ and fundamental purpose will remain the same. Space economies are just one way of allocating scarce resources.


After all, what an exciting time to live.




Works Cited


  1. ISU Library - International Space University. https://isulibrary.isunet.edu/doc_num.php?explnum_id=290.

  2. Gilbert, Alex. “Mining in Space Is Coming.” Milken Institute Review, https://www.milkenreview.org/articles/mining-in-space-is-coming.

  3. ISRU Info : Home Of The Space Resources Roundtable. https://isruinfo.com/public/docs/Commercial%20Lunar%20Propellant%20Architecture.pdf.

  4. Weinzierl, Matt, and Mehak Sarang. “The Commercial Space Age Is Here.” Harvard Business Review, 12 Feb. 2021, https://hbr.org/2021/02/the-commercial-space-age-is-here.

  5. Cookson, Clive. “Space Mining Takes Giant Leap from Sci-Fi to Reality.” Financial Times, Financial Times, 19 Oct. 2017, https://www.ft.com/content/78e8cc84-7076-11e7-93ff-99f383b09ff9.

  6. Space Economy for People, Planet and Prosperity - Oecd.org. https://www.oecd.org/sti/inno/space-forum/space-economy-for-people-planet-and-prosperity.pdf.



About the author:

I am a 19-year old girl living on the sunny island of Cyprus! I am currently on a gap year and work in digital marketing. I love everything that has to do with the social sciences and the environment; I organize community clean ups each week and will be studying economics and/or psychology in college!



Credits:



44 views0 comments

Recent Posts

See All