ecological economics

Information about ecological economics

Ecological economics is a transdisciplinary field of academic research that addresses the dynamic and spatial interdependence between human economies and natural ecosystems. Ecological economics brings together and connects different disciplines, within the natural and social sciences but especially between these broad areas.

Overview

As the name suggests, the field is comprised of researchers with a background in economics and ecology. An important motivation for the emergence of ecological economics has been criticism on the assumptions and approaches of traditional (mainstream) environmental and resource economics. Ecological economics presents a more pluralistic approach to the study of environmental problems and policy solutions, characterized by systems perspectives, adequate physical and biological contexts, and a focus on long-term environmental sustainability. Ecological economics can be regarded as a version of environmental science with much emphasis on social, political, economic and behavioral issues. Its conceptual founders are regarded to be economists Nicholas Georgescu-Roegen, Kenneth Boulding and Herman Daly, ecologists C.S. Holling, H.T. Odum and Robert Costanza, biologist Gretchen Daily and physicist Robert Ayres. Daly and Costanza were critical in the institutional founding of the field - resulting in the establishment of the academic journal Ecological Economics and the International Society for Ecological Economics (ISEE). Another notable school of thought in ecological economics is the Beijer International Institute of Ecological Economics.[1]

History

The origination of ecological economics as a specific field per se is credited to economist Herman Daly, a professor at University of Maryland and formerly an economist for the World Bank.

Ecological economics has been popularized by ecologist and University of Vermont Professor Robert Costanza, who founded the International Society for Ecological Economics (ISEE) and carried out much of the founding research while at the University of Maryland. Economist Nicholas Georgescu-Roegen (1906-1994) who was among Daly's teachers at Vanderbilt University, provided ecological economics with a conceptual framework based on the material and energy flows of economic production and consumption. His magnum opus, The Entropy Law and the Economic Process (1971), has been highly influential.[2]

Nobel prize-winning chemist, Frederick Soddy (1877-1956), and economist Kenneth Boulding (1910-1993) are among other intellectual precursors. Furthermore, some key concepts of what is now ecological economics are evident in the writings of E.F. Schumacher, whose book Small is Beautiful - A Study of Economics as if People Mattered (1973) was published just a few years before the first edition of Daly's comprehensive and persuasive Steady-State Economics (1977).[3][4] Ecological economics' intellectual ancestry may be traced in large part to political economy, a refinement of early economic theory that includes among its earlier researchers Thomas Malthus, David Ricardo and John Stuart Mill. Mill, in particular, by hypothesizing that the "stationary state" of an economy might be something that could be considered desirable, anticipated later insights of modern ecological economists, without having had their experience of the social and ecological costs of the dramatic post-World War II industrial expansion.

CUNY geography professor David Harvey was one of the first to explicitly add ecological concerns to political economic literature. This parallel development in political economy has been continued by analysts such as sociologist John Bellamy Foster.

Topics in ecological economics

Concept

The objective of ecological economics (EE) is to ground economic thinking and practice in physical reality, especially in the laws of physics (particularly the laws of thermodynamics) and in knowledge of biological systems. It accepts as a goal the improvement of human wellbeing through economic development, and seeks to ensure achievement of this through planning for the sustainable development of ecosystems and societies. It distinguishes itself from neoclassical economics (NCE) primarily by its assertion that economics is a subfield of ecology, in that ecology deals with the energy and matter transactions of life and the Earth, and the human economy is by definition contained within this system. In contrast, NCE has historically assumed implicitly (and, more recently, explicitly) that the environment is a subset of the human economy. In this approach, if nature is valuable to our economies, that is because people will pay for its services such as clean air, clean water, encounters with wilderness, etc. It is largely this assertion which allows for NCE to claim theoretically that infinite economic growth is both possible and desirable. However, this belief disagrees with much of what the natural sciences have learned about the world, and, according to EE, completely ignores the contributions of natural capital to the creation of wealth. Natural capital can be considered the planetary endowment of scarce matter and energy, along with the complex and biologically diverse ecosystems that provide goods and ecosystem services directly to human communities: micro- and macro-climate regulation, water recycling, water purification, storm water regulation, waste absorption, food and medicine production, pollination, protection from solar and cosmic radiation, the view of a starry night sky, etc.[5][6]

Allocation of resources

While NCE deals with the efficient allocation of resources, it ignores two other fundamental economic problems which are central to ecological economics: distribution (equity) and the scale of the economy relative to the ecosystem upon which it is reliant.[7] EE also makes a clear distinction between growth (quantitative) and development (qualitative improvement of the quality of life) while arguing that NCE confuses the two. EE challenges the common normative approach taken towards natural resources, claiming that it undervalues natural capital by displaying it as interchangeable with human capital--labor and technology. EE counters this convention by asserting that human capital is instead complementary to and dependent upon natural capital, as human capital inevitably derives from natural capital. From these premises, it follows that economic policy has a fiduciary responsibility to the greater ecological world, and that, by undervaluing the importance of natural capital, sustainable development (as opposed to growth)--which is the only solution to elevating the standard of living for citizens worldwide--will not result. Furthermore, ecological economists point out that, beyond modest levels, increased per-capita consumption (the economist's version of "standard of living") does not necessarily lead to improvements in human wellbeing, while this same consumption can have harmful effects on the environment and even on broader societal wellbeing.

Energy economics

It rejects the view of energy economics that growth in the energy supply is related directly to well being, focusing instead on biodiversity and creativity - or natural capital and individual capital, in the terminology sometimes adopted to describe these economically. In practice, ecological economics focuses primarily on the key issues of uneconomic growth and quality of life. Ecological economists are inclined to acknowledge that much of what is important in human well-being is not analyzable from a strictly economic standpoint and suggests an interdisciplinary approach combining social and natural sciences as a means to address this.

Services provided by the environment

A study was carried out by a number of leading ecological economists to determine the price of the services provided by the environment. This was determined by looking at the price to filter water and other such services provided by the environment. The total was determined to be 33 trillion dollars (in 1997 US dollars), more than twice the total GDP of the world at the time of the study.[8] However, the study was criticized by both mainstream environmental economists - for being inconsistent with assumptions of monetary valuation - and ecological economists - for being inconsistent with an ecological economics focus on biological and physical indicators.[9]

See also

References

1. ^ Masood, E. and Garwin, L. 1998. Costing the Earth: when ecology meets economics. Science 395: 426-427.
2. ^ Georgescu-Roegen, N. 1971. The Entropy Law and the Economic Process. Cambridge, Mass.: Harvard University Press.
3. ^ Schumacher, E.F. 1973. Small is Beautiful: A Study of Economics as if People Mattered. London: Blond and Briggs.
4. ^ Daly, H. 1991. Steady-State Economics (2nd ed.). Washington, D.C.: Island Press.
5. ^ Daily, G.C. 1997. Nature's Services: Societal Dependence on Natural Ecosystems. Washington, D.C.: Island Press.
6. ^ Millenium Ecosystem Assessment. 2005. Ecosystems and Human Well-Being: Biodiversity Synthesis. Washington, D.C.: World Resources Institute.
7. ^ Daly, H. and Farley, J. 2004. Ecological Economics: Principles and Applications. Washington: Island Press.
8. ^ Costanza, R., d'Arge, R., de Groot, R., Farber, S., Grasso, M., Hannon, B., Naeem, S., Limburg, K., Paruelo, J., O'Neill, R.V., Raskin, R., Sutton, P., and van den Belt, M. 1997. The value of the world's ecosystem services and natural capital. Nature 387: 253-260.
9. ^ Norgaard, R.B. and Bode, C. 1998. Next, the value of God, and other reactions. Ecological Economics 25: 37-39.

Further reading

  • Common, M. and Stagl, S. 2005. Ecological Economics: An Introduction. New York: Cambridge University Press.
  • Daly, H. and Townsend, K. (eds.) 1993. Valuing The Earth: Economics, Ecology, Ethics. Cambridge, Mass.; London, England: MIT Press.
  • Georgescu-Roegen, N. 1975. Energy and economic myths. Southern Economic Journal 41: 347-381.

External links

ecosystem is a natural unit consisting of all plants, animals and micro-organisms in an area functioning together with all the non-living physical factors of the environment.
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Economics is the social science that studies the production, distribution, and consumption of goods and services. The term economics comes from the Greek for oikos (house) and nomos (custom or law), hence "rules of the house(hold).
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Ecology (also known as Oekologie, Okology, or Oekology[1],from Greek: οίκος, oikos, "household"; and λόγος, logos
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Environmental economics is a subfield of economics concerned with environmental issues (other usages of the term are not uncommon). In using standard methods of neo-classical economics, it is distinguished from green economics or ecological economics which include the nonstandard
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Sustainability is a characteristic of a process or state that can be maintained at a certain level indefinitely. The term, in its environmental usage, refers to the potential longevity of vital human ecological support systems, such as the planet's climatic system, systems of
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Environmental science is the study of interactions among physical, chemical, and biological components of the environment. It is an interdisciplinary science overlapping the categories in Natural sciences, Engineering sciences and Social sciences.
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Nicholas Georgescu-Roegen, born Nicolae Georgescu (Constanţa, Romania, 4 February 1906 – Nashville, Tennessee, 30 October 1994) was a Romanian mathematician, statistician and economist, best known for his 1971 magnum opus
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Kenneth Ewart Boulding (January 18 1910 - March 18 1993) was an economist, educator, peace activist, poet, religious mystic, devoted Quaker, systems scientist, and interdisciplinary philosopher.
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Herman Daly (1938) is an American ecological economist and professor at the School of Public Policy of University of Maryland, College Park in the United States.

He was Senior Economist in the Environment Department of the World Bank, where he helped to develop policy
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Crawford Stanley (Buzz) Holling (6 December 1930, Theresa, New York) is an Canadian ecologist, and Emeritus Eminent Scholar and Professor in Ecological Sciences at the University of Florida. Holling is one of the conceptual founders of ecological economics.
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Howard Thomas Odum
Birth: 1 September 1924
Chapel Hill, North Carolina, USA
Death: 11 September 2002
Gainesville, Florida, United States
School/tradition: Zoology
Main interests: Mathematics, Ecology and Natural philosophy
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Robert Costanza (14 September, 1950, Pittsburgh, Pennsylvania) is an American ecological economist and the Gund Professor of Ecological economics and Director of the Gund Institute for Ecological Economics at the University of Vermont.
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Robert Underwood Ayres, American-born physicist and economist. His career has focused on the application of physical ideas, especially the laws of thermodynamics, to economics; a long-standing pioneering interest in material flows and transformations (industrial ecology or
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Herman Daly (1938) is an American ecological economist and professor at the School of Public Policy of University of Maryland, College Park in the United States.

He was Senior Economist in the Environment Department of the World Bank, where he helped to develop policy
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Robert Costanza (14 September, 1950, Pittsburgh, Pennsylvania) is an American ecological economist and the Gund Professor of Ecological economics and Director of the Gund Institute for Ecological Economics at the University of Vermont.
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Nicholas Georgescu-Roegen, born Nicolae Georgescu (Constanţa, Romania, 4 February 1906 – Nashville, Tennessee, 30 October 1994) was a Romanian mathematician, statistician and economist, best known for his 1971 magnum opus
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Frederick Soddy (2 September 1877 – 22 September 1956) was an English radiochemist.

Soddy was born in Eastbourne, England. He went to school at Eastbourne College, before going on to study at University College of Wales at Aberystwyth and at Merton College, Oxford.
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Kenneth Ewart Boulding (January 18 1910 - March 18 1993) was an economist, educator, peace activist, poet, religious mystic, devoted Quaker, systems scientist, and interdisciplinary philosopher.
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Ernst Friedrich "Fritz" Schumacher (16 August 1911 – 4 September 1977) was an internationally influential economic thinker with a professional background as a statistician and economist in Britain.
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Thomas Robert Malthus, FRS (13th February, 1766 – 29th December, 1834), was an English demographer and political economist. He is best known for his highly influential views on population growth.
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David Ricardo (18 April, 1772–11 September, 1823), a political economist, is often credited with systematizing economics, and was one of the most influential of the classical economists, along with Thomas Malthus and Adam Smith.
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John Stuart Mill (20 May 1806 – 8 May 1873), British philosopher, political economist, civil servant and Member of Parliament, was an influential liberal thinker of the 19th century.
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David Harvey is the name of:
  • David Harvey (footballer) (born 1948)
  • David Harvey (geographer) (born 1935)
  • David Harvey (producer), American producer
  • David Harvey (statistician) (born 1928)
  • David Harvey (television), television presenter and executive

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John Bellamy Foster is an American journalist, sociologist, essayist and eco-socialist, as well as editor of the Monthly Review, a prominent Marxist magazine.

Foster is a Professor of Sociology at the University of Oregon in Eugene.
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laws of thermodynamics, in principle, describe the specifics for the transport of heat and work in thermodynamic processes. Since their conception, however, these laws have become some of the most important in all of physics and other branches of science connected to thermodynamics.
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Sustainable development is a socio-ecological process characterized by the fulfilment of human needs while maintaining the quality of the natural environment indefinitely. The linkage between environment and development was globally recognized in 1980, when the International Union
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Neoclassical economics refers to a general approach in economics focusing on the determination of prices, outputs, and income distributions in markets through supply and demand.
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Natural capital, as described in the book Natural Capitalism, is a metaphor for the mineral, plant, and animal formations of the Earth's biosphere when viewed as a means of production of oxygen, water filter, erosion preventer, or provider of other ecosystem services.
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ecosystem services and include products like clean drinking water and processes like the decomposition of wastes. Ecosystem services are distinct from other ecosystem products and functions because there is human demand for these natural assets.
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