A designer and a political economy teacher on the difference between managing your money and understanding the system that decides what money measures.
Ana Falcao
Strategic Designer
Elena Sisti
Entrepreneur & Political Economy Teacher
In our first conversation, Elena said something that stuck with me for days. She said that women were convinced they couldn't count, so their work stopped counting. I kept turning that sentence over.
Because if the problem is that deep, if it sits inside the system itself, then learning how to budget or invest doesn't actually solve it. It helps you operate better inside a structure that was already built without you.
Elena makes a distinction I had never thought about before: financial education and economic education are not the same thing. Financial education teaches you to manage money. Economic education teaches you how value is created, measured, and distributed, and who made those rules.
That's the conversation we had for this module.
Elena, the financial industry is in a rush to teach women about money. By 2030, women will control $34 trillion in investable assets. Every bank and podcast wants to be the one educating them. As an economist, is financial literacy enough?
Financial literacy is essential for all of us, not only women. It is fundamental for our wellbeing that we understand the financial aspects of the decisions we make. But I still remember my Financial Mathematics professor, Erio Castagnoli, who said repeatedly that the basics course was so easy he was bored teaching it. And he was right. Once you grasp the concept of cash flow, interest rates, discount rates, rates of return, and the difference between debt and equity, there is really not much more you need to survive and talk to the person who manages your investments. All of it comes down to time and risk. The most complex calculation you need is a multiplication and a percentage.
The surge of interest in financial literacy is mostly driven by the financial system itself. Banks want women to open accounts, to choose investments. We need people to make better decisions managing their money, to understand that credit cards charge interest and that there is more to investing than buying another house. But the illusion that you can manage investments entirely on your own is just that: an illusion. You need regulated financial advisors. They are the ones you speak to when deciding what to do with your money.
I believe it is very important to teach women and men financial literacy. But it is not transformative, and it will have little effect on the everyday life of women.
What would be transformative is teaching Economics. A social science that studies the production, distribution, and consumption of goods and services. To put it simply, it studies the choices of individuals and companies: why we choose to work, what we buy and why, why we stay home and don't go out. That's microeconomics. Then it looks at the same thing as systems: countries, multinationals, trade, financial markets. What happens when individual choices combine and become social behaviour. The effects on unemployment, inflation, trade, health expenditure, education, and how all of these affect growth and welfare.
If we want to invest our savings with more knowledge, financial education is enough. If we want to contribute to change and fully understand what happens around us, it is economics we need to understand.
You make a distinction between financial education and economic education. Most people would say they're the same thing. What's the difference, and why does it matter for women?
Economics studies how individuals behave and interact when dealing with scarce resources, incentives, and the costs and benefits of their actions. From an economic perspective, every individual tries to get the best possible result from what they do. They maximise their utility. As a society, we assume that individual actions add up to collective wellbeing.
This is a powerful way to explain human behaviour. But then it needs to be measured. What defines utility? What is wellbeing?
And here is where it becomes political. As an economist, you start converting aspects of life into monetary value. Those conversions have very little to do with truth and a lot to do with the values and beliefs of a society at a particular time. What to measure is an ideological choice. What determines individual utility and what constitutes welfare is a political decision that shapes the world.
In the last 50 years, economists have heavily relied on econometrics and mathematics. That shifted the general perception of economics from a social science into something that looks like an exact science. But it is not. It is political. The fact that you use maths does not make it like physics.
Think about GDP. It measures the monetary value of goods and services produced for the market. But it never measures the production of goods and services inside the home. All unpaid domestic work disappeared from the statistics. Not measured. It does not exist. That is a political choice, not a scientific one. And not a neutral one.
I'll give you an example that makes this very concrete. After a knee operation on an elderly person, the community has to decide: do we keep them in hospital for rehabilitation, or send them home?
The monetary calculation is simple. Hospital has costs: doctors, electricity, nurses. Sending home: cost equals zero. The choice seems obvious.
But an economist without bias would calculate differently. Hospital has costs plus the risk of infection and return visits. Sending home has the cost of the time spent by the person who will care for the patient, bringing them back to hospital, managing daily needs.
The entire decision depends on the value assigned to the time of the caregiver at home. If that value is zero, because most caregivers are women and many are classified as unemployed, then you send the patient home and a woman takes care of them for free.
That is how invisible work stays invisible. Not because it doesn't exist, but because the system assigns it a value of zero.
GDP was created in the 1930s. Household production was explicitly excluded. Simon Kuznets himself warned against using it as a measure of welfare. Ninety years later, it's still the primary metric. Why?
GDP is a perfectly good metric for what it measures: the monetary value of market production. The problem is not GDP itself. The problem is that GDP became the economy in people's minds.
When you study geography at school, there's a whole section describing the economy through three sectors: primary, secondary, tertiary. The entire economy is collapsed into GDP at every level of education.
But all of us, in every country, produce goods and services outside the market. We give birth. We take care of children. We clean houses, we iron, we cook, we drive kids to school. We look after each other when we are sick. We volunteer at community centres. We take care of relatives and friends in need, we accompany them to hospital. We do many things that are not exchanged in the market but have economic value.
In 2011, the OECD economist Veerle Miranda calculated the value of all the work we do outside the market and concluded that between one-third and half of all valuable economic activity is not accounted for in traditional measures of wellbeing. In all countries, women do more of this work than men.
Between one-third and half. That is why women should be concerned about economic theory far more than about their financial abilities. That work is not going anywhere in real life, even though it disappeared from the statistics. Someone will have to do it. It needs to exist in the numbers so we can account for it and decide who does it and how.
There are not three sectors of the economy. There are four. The household production sector is the foundation, and GDP would not exist without it. Since we are all aware of how much these activities contribute to the wellbeing of a society, should they not be included in how we measure it?
Is it just a coincidence that this work is mostly done by women, all around the world?
A Forbes article published last month argues that there is a real difference between having assets and having agency, between being a client of the financial system and being an architect of it. Do you agree?
In this sense I believe men and women are more similar than we think. There are those who want to change the financial system and those who like it as it is. Both men and women working in the financial world share responsibility for the kind of society we want to build. Financial choices are connected to what we want our money to support and how we can drive change. I know many men who share the same priorities as women for a fairer, more just, and more equal society.
Traditionally, women show more concern for the environment and fair investment practices. Evidence shows that more balance between the sexes leads to a more balanced society, since women tend to bring less risky values into the equation. But the real differences in the financial system come from the inability of women to participate in the rooms where decisions are made. The problem is access to those rooms, not intention.
You teach economics to design students at Domus Academy. What happens when a creative person first encounters economic thinking?
What I see is a distrust of numbers. Measuring means assigning numbers, scores, or attributes with specific rules. The distrust of money as a measuring unit comes from a perception of bad feeling and moral judgment related to money, profit, and wealth, something common across cultures. When you introduce monetary value, there's a feeling that you're making something less important, more mundane.
Economists are perfectly aware that monetary value is a functional choice that allows enormous simplification. There is little moral significance to it. What we should be challenging is the set of rules, not the effort to measure.
When my students at Domus see my Excel sheets with budgets and business plans, they immediately think I am trying to reduce creativity, aesthetics, and lateral thinking into something instrumental. While I am just providing them with tools to translate their abilities into a language that accountants and finance people understand.
I told a student once: you can measure in flowers if you want. What is transformative is the process that takes you to the evaluation. To measure means to be able to set the rules and speak clearly about the different choices and options available. If you refuse to measure whether your creativity works better than someone else's for the company, why should the company choose yours?
The choice of what and how to measure reflects values. Measurement is not neutral. But refusing to measure is not neutral either.
If the goal is not just financial literacy but economic confidence, what are the concepts a woman needs that she was never taught?
The first and most important thing to understand is that the market is not the economy. GDP is not the economy.
Price is the amount of money exchanged in a market transaction. It is easy to measure because it results from a monetary exchange. Economic value is different. It is the total value of the benefits of a product or service, whether or not money changes hands.
At a personal level, when you do any activity, there are two ways to measure its economic value.
The first is substitution cost. If you cook dinner for your family: how much would you spend if you went to a restaurant or paid someone to cook? In my case, a family of six, a restaurant averages 25 euros per person. Take away 10 euros for the ingredients I use at home, and the value of my cooking work is 15 times 6: 90 euros. For one dinner.
The second is opportunity cost. How much would I earn if I spent that same hour doing my job? In my case, about 100 euros.
I used this exercise in Cambodia, helping communities work out business plans for their family farms. I shocked them by asking to calculate the value of the women's work in the houses, cooking for everyone, cleaning for the whole family, while the men were in the fields. Very simple exercise. Very easy, once someone tells you that what you do is work, even if you've always considered it free. They simply never thought of it.
Use it every time you make a decision. In business and in personal life. The world has spent a long time convincing women that we care and love because it's our nature, so we naturally do all that work for free. It is time we say: we agree, we need to care and love. But it has enormous value. So let's calculate it and start sharing the responsibility.
Don't forget: between one-third and half of all economic activity is done for free. Most of it by women.
At a social level, the same thinking applies. When a community decides that schools close at 2pm and children go home, is that a personal problem, or is it a society that is not counting the work of whoever will look after them? Are we sure, as a community, that we're saving money? What are the real economic benefits and costs of sending children home that early?
The New Economics Foundation published a paper calculating the real value to society of different professions. For every £1 paid to a childcare worker, between £7 and £9.50 of benefits are generated for society. Hospital cleaners hold the record: for every £1 they're paid, over £10 in social value is generated, because people don't get infections, and that lowers health expenditure for everyone.
This brings in another concept: externalities. The market has clear rules set by humans with different priorities at different times. It is not a natural environment. The current rules allow participants to mostly ignore what they do to society. Externalities are negative when they impose a cost on others, like pollution from a flight you don't pay for. They are positive when they create a benefit, like the hospital cleaner preventing infections.
Understanding externalities, opportunity cost, and the difference between price and value. These are not abstract academic concepts. They are tools that change how you see your own work, your own time, and your own contribution.