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178-450: The GPI is used in ecological economics , "green" economics, sustainability and more inclusive types of economics. It factors in environmental and carbon footprints that businesses produce or eliminate, including in the forms of resource depletion , pollution and long-term environmental damage. GDP is increased twice when pollution is created, since it increases once upon creation (as a side-effect of some valuable process) and again when

356-487: A fiduciary responsibility to the greater ecological world, and that sustainable development must therefore take a different approach to valuing natural resources and ecological functions. Recently, Stanislav Shmelev developed a new methodology for the assessment of progress at the macro scale based on multi-criteria methods, which allows consideration of different perspectives, including strong and weak sustainability or conservationists vs industrialists and aims to search for

534-487: A fiduciary responsibility to the greater ecological world, and that sustainable development must therefore take a different approach to valuing natural resources and ecological functions. Recently, Stanislav Shmelev developed a new methodology for the assessment of progress at the macro scale based on multi-criteria methods, which allows consideration of different perspectives, including strong and weak sustainability or conservationists vs industrialists and aims to search for

712-627: A market system failed to take into account the needs of future generations, and that a socialist economy required calculation in kind , the tracking of all the different materials, rather than synthesising them into money as a general equivalent . In this he was criticised by neo-liberal economists such as Ludwig von Mises and Freidrich Hayek in what became known as the socialist calculation debate . The debate on energy in economic systems can also be traced back to Nobel prize -winning radiochemist Frederick Soddy (1877–1956). In his book Wealth, Virtual Wealth and Debt (1926), Soddy criticized

890-627: A market system failed to take into account the needs of future generations, and that a socialist economy required calculation in kind , the tracking of all the different materials, rather than synthesising them into money as a general equivalent . In this he was criticised by neo-liberal economists such as Ludwig von Mises and Freidrich Hayek in what became known as the socialist calculation debate . The debate on energy in economic systems can also be traced back to Nobel prize -winning radiochemist Frederick Soddy (1877–1956). In his book Wealth, Virtual Wealth and Debt (1926), Soddy criticized

1068-475: A 'middle way' by providing a strong neo-Keynesian economic push without putting excessive pressure on the natural resources, including water or producing emissions, both directly and indirectly. A key concept of energy economics is net energy gain , which recognizes that all energy sources require an initial energy investment in order to produce energy. To be useful the energy return on energy invested ( EROEI ) has to be greater than one. The net energy gain from

1246-475: A 'middle way' by providing a strong neo-Keynesian economic push without putting excessive pressure on the natural resources, including water or producing emissions, both directly and indirectly. A key concept of energy economics is net energy gain , which recognizes that all energy sources require an initial energy investment in order to produce energy. To be useful the energy return on energy invested ( EROEI ) has to be greater than one. The net energy gain from

1424-438: A coalition of representatives from several state government departments in search of a metric that would factor social well-being into the more traditional gross product indicators of the economy. The metric would help determine the sustainability of growth and economic progress against social and environmental factors typically left out of national indicators. The GPI was chosen as a comprehensive measure of sustainability as it has

1602-717: A commitment to eradicate global inequality through sustainable development (See Green Economics). Examples of heterodox ecological economic experiments include the Catalan Integral Cooperative and the Solidarity Economy Networks in Italy. Both of these grassroots movements use communitarian based economies and consciously reduce their ecological footprint by limiting material growth and adapting to regenerative agriculture . Cultural and heterodox applications of economic interaction around

1780-501: A commitment to eradicate global inequality through sustainable development (See Green Economics). Examples of heterodox ecological economic experiments include the Catalan Integral Cooperative and the Solidarity Economy Networks in Italy. Both of these grassroots movements use communitarian based economies and consciously reduce their ecological footprint by limiting material growth and adapting to regenerative agriculture . Cultural and heterodox applications of economic interaction around

1958-460: A country's economic activity over a year has left the country with a better or worse future possibility of repeating at least the same level of economic activity in the long run. For example, agricultural activity that uses replenishing water resources, such as river runoff, would score a higher GPI than the same level of agricultural activity that drastically lowers the water table by pumping irrigation water from wells. Hicks (1946) pointed out that

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2136-416: A decline, with valuable habitat such as estuaries in critical condition. The aquaculture or farming of piscivorous fish, like salmon , does not help solve the problem because they need to be fed products from other fish. Studies have shown that salmon farming has major negative impacts on wild salmon, as well as the forage fish that need to be caught to feed them. Since animals are higher on

2314-416: A decline, with valuable habitat such as estuaries in critical condition. The aquaculture or farming of piscivorous fish, like salmon , does not help solve the problem because they need to be fed products from other fish. Studies have shown that salmon farming has major negative impacts on wild salmon, as well as the forage fish that need to be caught to feed them. Since animals are higher on

2492-495: A great deal of degradation of nature's ability to clear waste, prevent erosion, pollinate crops, etc., was being done in the name of monetary profit opportunity: this was adding to GDP but causing a great deal of long term risk in the form of mudslides, reduced yields, lost species, water pollution, etc. Such effects have been very marked in areas that suffered serious deforestation , notably Haiti , Indonesia , and some coastal mangrove regions of India and South America . Some of

2670-557: A green economy, competent institutions and governance systems are vital in guaranteeing the efficient execution of strategies, guidelines, campaigns, and programmes. Shifting to a Green Economy demands a fresh mindset and an innovative outlook of doing business. It likewise necessitates new capacities, skills set from labor and professionals who can competently function across sectors, and able to work as effective components within multi-disciplinary teams. To achieve this goal, vocational training packages must be developed with focus on greening

2848-557: A green economy, competent institutions and governance systems are vital in guaranteeing the efficient execution of strategies, guidelines, campaigns, and programmes. Shifting to a Green Economy demands a fresh mindset and an innovative outlook of doing business. It likewise necessitates new capacities, skills set from labor and professionals who can competently function across sectors, and able to work as effective components within multi-disciplinary teams. To achieve this goal, vocational training packages must be developed with focus on greening

3026-458: A key role in producing well-being. At the same time, there is intense debate about how and when to place values on these benefits. A study was carried out by Costanza and colleagues to determine the 'value' of the services provided by the environment. This was determined by averaging values obtained from a range of studies conducted in very specific context and then transferring these without regard to that context. Dollar figures were averaged to

3204-458: A key role in producing well-being. At the same time, there is intense debate about how and when to place values on these benefits. A study was carried out by Costanza and colleagues to determine the 'value' of the services provided by the environment. This was determined by averaging values obtained from a range of studies conducted in very specific context and then transferring these without regard to that context. Dollar figures were averaged to

3382-435: A measure of societal well-being claim that competing measures such as GPI are more vulnerable to political manipulation. Finnish economists Mika Maliranta and Niku Määttänen write that the problem of alternative development indexes is their attempt to combine things that are incommensurable. It is hard to say what they exactly indicate and difficult to make decisions based on them. They can be compared to an indicator that shows

3560-579: A modern 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), is credited by Daly as a fundamental text of the field, alongside Soddy's Wealth, Virtual Wealth and Debt . Some key concepts of what is now ecological economics are evident in the writings of Kenneth Boulding and E. F. Schumacher , whose book Small Is Beautiful – A Study of Economics as if People Mattered (1973)

3738-512: A modern 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), is credited by Daly as a fundamental text of the field, alongside Soddy's Wealth, Virtual Wealth and Debt . Some key concepts of what is now ecological economics are evident in the writings of Kenneth Boulding and E. F. Schumacher , whose book Small Is Beautiful – A Study of Economics as if People Mattered (1973)

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3916-522: A more politically applied form of the subject. According to ecological economist Malte Michael Faber  [ de ] , ecological economics is defined by its focus on nature, justice, and time. Issues of intergenerational equity , irreversibility of environmental change, uncertainty of long-term outcomes, and sustainable development guide ecological economic analysis and valuation. Ecological economists have questioned fundamental mainstream economic approaches such as cost-benefit analysis , and

4094-409: A negative impact upon being able to continue some types of production. GDP measures the entirety of production at a given time. GDP is relatively straightforward to measure compared to GPI. Competing measures like GPI define well-being, which are arguably impossible to define. Therefore, opponents of GPI claim that GPI cannot function to measure the goals of a diverse, plural society. Supporters of GDP as

4272-494: A novel perspective on the management of surplus energy within economies. This concept encourages a shift from growth-centric models to approaches that prioritise sustainable and meaningful expenditures of excess resources . Thermoeconomics is based on the proposition that the role of energy in biological evolution should be defined and understood through the second law of thermodynamics , but also in terms of such economic criteria as productivity , efficiency , and especially

4450-494: A novel perspective on the management of surplus energy within economies. This concept encourages a shift from growth-centric models to approaches that prioritise sustainable and meaningful expenditures of excess resources . Thermoeconomics is based on the proposition that the role of energy in biological evolution should be defined and understood through the second law of thermodynamics , but also in terms of such economic criteria as productivity , efficiency , and especially

4628-662: A per hectare number for different types of ecosystem e.g. wetlands, oceans. A total was then produced which came out at 33 trillion US dollars (1997 values), more than twice the total GDP of the world at the time of the study. This study was criticized by pre-ecological and even some environmental economists – for being inconsistent with assumptions of financial capital valuation – and ecological economists – for being inconsistent with an ecological economics focus on biological and physical indicators. The whole idea of treating ecosystems as goods and services to be valued in monetary terms remains controversial. A common objection

4806-662: A per hectare number for different types of ecosystem e.g. wetlands, oceans. A total was then produced which came out at 33 trillion US dollars (1997 values), more than twice the total GDP of the world at the time of the study. This study was criticized by pre-ecological and even some environmental economists – for being inconsistent with assumptions of financial capital valuation – and ecological economists – for being inconsistent with an ecological economics focus on biological and physical indicators. The whole idea of treating ecosystems as goods and services to be valued in monetary terms remains controversial. A common objection

4984-461: A point, beyond $ 7,000 GDP/capita the increase in GPI is reduced or remains stagnant. Similar trends can be seen when comparing GDP to life satisfaction as well as in a Gallup Poll published in 2008. According to Lawn's model, the "costs" of economic activity include the following potential harmful effects: Analysis by Robert Costanza also around 1995 of nature's services and their value showed that

5162-444: A recent focus of the labour movement . The calculation of GPI presented in the simplified form is the following: GPI = A + B - C - D + I A is income weighted private consumption B is value of non-market services generating welfare C is private defensive cost of natural deterioration D is cost of deterioration of nature and natural resources I is increase in capital stock and balance of international trade The GPI indicator

5340-414: A well-accepted scientific methodology that can be adopted by other states and compared over time. Maryland's GPI trends are comparable to other states and nations that have measured their GPI in that gross state product (GSP) and GPI have diverged over the past four decades where GSP has increased more rapidly than GPI. While economic elements of GPI have increased overall (with a significant drop off during

5518-432: Is also controversial in ecological economics. The United Nations Food and Agriculture Organization achieved near-universal agreement in 2008 that such payments directly valuing ecosystem preservation and encouraging permaculture were the only practical way out of a food crisis. The holdouts were all English-speaking countries that export GMOs and promote " free trade " agreements that facilitate their own control of

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5696-432: Is also controversial in ecological economics. The United Nations Food and Agriculture Organization achieved near-universal agreement in 2008 that such payments directly valuing ecosystem preservation and encouraging permaculture were the only practical way out of a food crisis. The holdouts were all English-speaking countries that export GMOs and promote " free trade " agreements that facilitate their own control of

5874-697: Is an effort to justify state services in GPI terms. It assigns the Commissioner of the Environment and Sustainable Development, an officer in the Auditor-General of Canada 's office, to perform the analysis and report to the House of Commons . However, Canada continues to state its overall budgetary targets in terms of reducing its debt to GDP ratio , which implies that GDP increase and debt reduction in some combination are its main priorities. In

6052-516: Is an important debate in ecological economics and the economics of sustainability. There is a continuum of views among economists between the strongly neoclassical positions of Robert Solow and Martin Weitzman , at one extreme and the 'entropy pessimists' , notably Nicholas Georgescu-Roegen and Herman Daly , at the other. Neoclassical economists tend to maintain that man-made capital can, in principle, replace all types of natural capital. This

6230-460: Is an important debate in ecological economics and the economics of sustainability. There is a continuum of views among economists between the strongly neoclassical positions of Robert Solow and Martin Weitzman , at one extreme and the 'entropy pessimists' , notably Nicholas Georgescu-Roegen and Herman Daly , at the other. Neoclassical economists tend to maintain that man-made capital can, in principle, replace all types of natural capital. This

6408-563: Is analogous to the relationship between the gross profit of a company and the net profit; the net profit is the gross profit minus the costs incurred, while the GPI is the GDP (value of all goods and services produced) minus the environmental and social costs. Accordingly, the GPI will be zero if the financial costs of poverty and pollution equal the financial gains in production of goods and services, all other factors being constant. Some economists assess progress in people's welfare by comparing

6586-443: Is based on the concept of sustainable income, presented by economist John Hicks (1948). The sustainable income is the amount a person or an economy can consume during one period without decreasing his or her consumption during the next period. In the same manner, GPI depicts the state of welfare in the society by taking into account the ability to maintain welfare on at least the same level in the future. The Genuine Progress Indicator

6764-432: Is both a transdisciplinary and an interdisciplinary field of academic research addressing the interdependence and coevolution of human economies and natural ecosystems , both intertemporally and spatially. By treating the economy as a subsystem of Earth's larger ecosystem, and by emphasizing the preservation of natural capital , the field of ecological economics is differentiated from environmental economics , which

6942-508: Is degrowth economics. Degrowth addresses both biophysical limits and global inequality while rejecting neoliberal economics. Degrowth prioritizes grassroots initiatives in progressive socio-ecological goals, adhering to ecological limits by shrinking the human ecological footprint (See Differences from Mainstream Economics Below). It involves an equitable downscale in both production and consumption of resources in order to adhere to biophysical limits. Degrowth draws from Marxian economics , citing

7120-508: Is degrowth economics. Degrowth addresses both biophysical limits and global inequality while rejecting neoliberal economics. Degrowth prioritizes grassroots initiatives in progressive socio-ecological goals, adhering to ecological limits by shrinking the human ecological footprint (See Differences from Mainstream Economics Below). It involves an equitable downscale in both production and consumption of resources in order to adhere to biophysical limits. Degrowth draws from Marxian economics , citing

7298-460: Is distinguishable from neoclassical economics primarily by its assertion that the economy is embedded within an environmental system. Ecology deals with the energy and matter transactions of life and the Earth, and the human economy is by definition contained within this system. Ecological economists argue that neoclassical economics has ignored the environment, at best considering it to be a subset of

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7476-408: Is distinguishable from neoclassical economics primarily by its assertion that the economy is embedded within an environmental system. Ecology deals with the energy and matter transactions of life and the Earth, and the human economy is by definition contained within this system. Ecological economists argue that neoclassical economics has ignored the environment, at best considering it to be a subset of

7654-417: Is known as the weak sustainability view, essentially that every technology can be improved upon or replaced by innovation, and that there is a substitute for any and all scarce materials. At the other extreme, the strong sustainability view argues that the stock of natural resources and ecological functions are irreplaceable. From the premises of strong sustainability, it follows that economic policy has

7832-417: Is known as the weak sustainability view, essentially that every technology can be improved upon or replaced by innovation, and that there is a substitute for any and all scarce materials. At the other extreme, the strong sustainability view argues that the stock of natural resources and ecological functions are irreplaceable. From the premises of strong sustainability, it follows that economic policy has

8010-474: Is largely ignored in contemporary economics but fits under the idea of sustainability . The best-known attempts to apply the concepts of GPI to legislative decisions are probably the GPI Atlantic , an index, not an indicator, invented by Ronald Colman for Atlantic Canada , who explicitly avoids aggregating the results obtained through research to a single number, alleging that it keeps decisions makers in

8188-515: Is measured by 26 indicators which can be divided into three main categories: Economic, Environmental, and Social. Some regions, nations, or states may adjust the verbiage slightly to accommodate their particular scenario. For example, the GPI template uses the phrase "Carbon Dioxide Emissions Damage" whereas the state of Maryland uses "Cost of Climate Change" because it also accounts for other greenhouse gases (GHG) such as methane and nitrous oxide . Non-profit organizations and universities have measured

8366-444: Is not analyzable from a strictly economic standpoint and suggests an interdisciplinary approach combining social and natural sciences as a means to address this. When considering surplus energy, ecological economists state this could be used for activities that do not directly contribute to economic productivity but instead enhance societal and environmental well-being. This concept of dépense , as developed by Georges Bataille , offers

8544-444: Is not analyzable from a strictly economic standpoint and suggests an interdisciplinary approach combining social and natural sciences as a means to address this. When considering surplus energy, ecological economists state this could be used for activities that do not directly contribute to economic productivity but instead enhance societal and environmental well-being. This concept of dépense , as developed by Georges Bataille , offers

8722-577: Is not contained – the Stern report is an example. The disagreement has sparked a vigorous debate on issue of discounting and intergenerational equity. Mainstream economics has attempted to become a value-free ' hard science ', but ecological economists argue that value-free economics is generally not realistic. Ecological economics is more willing to entertain alternative conceptions of utility , efficiency , and cost-benefits such as positional analysis or multi-criteria analysis. Ecological economics

8900-526: Is not contained – the Stern report is an example. The disagreement has sparked a vigorous debate on issue of discounting and intergenerational equity. Mainstream economics has attempted to become a value-free ' hard science ', but ecological economists argue that value-free economics is generally not realistic. Ecological economics is more willing to entertain alternative conceptions of utility , efficiency , and cost-benefits such as positional analysis or multi-criteria analysis. Ecological economics

9078-466: Is not made. Food production may become a problem, as erosion , an impending water crisis , and soil salinity (from irrigation ) reduce the productivity of agriculture. Ecological economists argue that industrial agriculture , which exacerbates these problems, is not sustainable agriculture , and are generally inclined favorably to organic farming , which also reduces the output of carbon. Global wild fisheries are believed to have peaked and begun

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9256-466: Is not made. Food production may become a problem, as erosion , an impending water crisis , and soil salinity (from irrigation ) reduce the productivity of agriculture. Ecological economists argue that industrial agriculture , which exacerbates these problems, is not sustainable agriculture , and are generally inclined favorably to organic farming , which also reduces the output of carbon. Global wild fisheries are believed to have peaked and begun

9434-526: Is now known as ecosocialism . The antecedents of ecological economics can be traced back to the Romantics of the 19th century as well as some Enlightenment political economists of that era. Concerns over population were expressed by Thomas Malthus , while John Stuart Mill predicted the desirability of the stationary state of an economy . Mill thereby anticipated later insights of modern ecological economists, but without having had their experience of

9612-470: Is now known as ecosocialism . The antecedents of ecological economics can be traced back to the Romantics of the 19th century as well as some Enlightenment political economists of that era. Concerns over population were expressed by Thomas Malthus , while John Stuart Mill predicted the desirability of the stationary state of an economy . Mill thereby anticipated later insights of modern ecological economists, but without having had their experience of

9790-425: 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

9968-425: 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

10146-439: Is that life is precious or priceless, but this demonstrably degrades to it being worthless within cost-benefit analysis and other standard economic methods. Reducing human bodies to financial values is a necessary part of mainstream economics and not always in the direct terms of insurance or wages . One example of this in practice is the value of a statistical life , which is a dollar value assigned to one life used to evaluate

10324-439: Is that life is precious or priceless, but this demonstrably degrades to it being worthless within cost-benefit analysis and other standard economic methods. Reducing human bodies to financial values is a necessary part of mainstream economics and not always in the direct terms of insurance or wages . One example of this in practice is the value of a statistical life , which is a dollar value assigned to one life used to evaluate

10502-438: Is the mainstream economic analysis of the environment. One survey of German economists found that ecological and environmental economics are different schools of economic thought , with ecological economists emphasizing strong sustainability and rejecting the proposition that physical (human-made) capital can substitute for natural capital (see the section on weak versus strong sustainability below). Ecological economics

10680-404: Is then a concern that ecological economics has failed to learn from the extensive literature in environmental ethics about how to structure a plural value system. Resource and neoclassical economics focus primarily on the efficient allocation of resources and less on the two other problems of importance to ecological economics: distribution ( equity ), and the scale of the economy relative to

10858-404: Is then a concern that ecological economics has failed to learn from the extensive literature in environmental ethics about how to structure a plural value system. Resource and neoclassical economics focus primarily on the efficient allocation of resources and less on the two other problems of importance to ecological economics: distribution ( equity ), and the scale of the economy relative to

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11036-538: 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 well-being through development, and seeks to ensure achievement of this through planning for the sustainable development of ecosystems and societies. Of course the terms development and sustainable development are far from lacking controversy. Richard B. Norgaard argues traditional economics has hi-jacked

11214-538: 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 well-being through development, and seeks to ensure achievement of this through planning for the sustainable development of ecosystems and societies. Of course the terms development and sustainable development are far from lacking controversy. Richard B. Norgaard argues traditional economics has hi-jacked

11392-429: Is typically viewed as economics for sustainable development , and may have goals similar to green politics . In international, regional, and national policy circles, the concept of the green economy grew in popularity as a response to the financial predicament at first then became a vehicle for growth and development. The United Nations Environment Programme (UNEP) defines a 'green economy' as one that focuses on

11570-429: Is typically viewed as economics for sustainable development , and may have goals similar to green politics . In international, regional, and national policy circles, the concept of the green economy grew in popularity as a response to the financial predicament at first then became a vehicle for growth and development. The United Nations Environment Programme (UNEP) defines a 'green economy' as one that focuses on

11748-656: The European Union (EU) the Metropole efforts and the London Health Observatory methods are equivalents focused mostly on urban lifestyle. The EU and Canadian efforts are among the most advanced in any of the G8 or OECD nations, but there are parallel efforts to measure quality of life or standard of living in health (not strictly wealth ) terms in all developed nations . This has also been

11926-551: The Great Recession ), social well-being has stagnated, with any values added being cancelled out by costs deducted, and environmental indicators, while improving slightly, are always considered costs. Combined, these elements bring the GPI below GSP. However, Maryland's GPI did increase by two points from 2010 to 2011. The calculation methodology of GPI was first developed and published in 1995 by Redefining Progress and applied to US data from 1950 to 1994. The original work on

12104-495: The Green Economy adherents robustly promote good governance. To boost local investments and foreign ventures, it is crucial to have a constant and foreseeable macroeconomic atmosphere. Likewise, such an environment will also need to be transparent and accountable. In the absence of a substantial and solid governance structure, the prospect of shifting towards a sustainable development route would be insignificant. In achieving

12282-433: The Green Economy adherents robustly promote good governance. To boost local investments and foreign ventures, it is crucial to have a constant and foreseeable macroeconomic atmosphere. Likewise, such an environment will also need to be transparent and accountable. In the absence of a substantial and solid governance structure, the prospect of shifting towards a sustainable development route would be insignificant. In achieving

12460-557: The precautionary principle . As ecological economists try to minimize these potential disasters, calculating the fallout of environmental destruction becomes a humanitarian issue as well. Already, the Global South has seen trends of mass migration due to environmental changes. Climate refugees from the Global South are adversely affected by changes in the environment, and some scholars point to global wealth inequality within

12638-436: The precautionary principle . As ecological economists try to minimize these potential disasters, calculating the fallout of environmental destruction becomes a humanitarian issue as well. Already, the Global South has seen trends of mass migration due to environmental changes. Climate refugees from the Global South are adversely affected by changes in the environment, and some scholars point to global wealth inequality within

12816-472: The trophic level , they are less efficient sources of food energy. Reduced consumption of meat would reduce the demand for food, but as nations develop, they tend to adopt high-meat diets similar to that of the United States. Genetically modified food (GMF) a conventional solution to the problem, presents numerous problems – Bt corn produces its own Bacillus thuringiensis toxin/protein, but

12994-409: The trophic level , they are less efficient sources of food energy. Reduced consumption of meat would reduce the demand for food, but as nations develop, they tend to adopt high-meat diets similar to that of the United States. Genetically modified food (GMF) a conventional solution to the problem, presents numerous problems – Bt corn produces its own Bacillus thuringiensis toxin/protein, but

13172-589: The First and Second laws of thermodynamics , to determine how much energy is needed at each point in a system, and in what form that energy is a cost in various environmental issues. The energy accounting system keeps track of energy in, energy out, and non-useful energy versus work done , and transformations within the system. Scientists have written and speculated on different aspects of energy accounting. Ecological economists agree that ecosystems produce enormous flows of goods and services to human beings, playing

13350-537: The First and Second laws of thermodynamics , to determine how much energy is needed at each point in a system, and in what form that energy is a cost in various environmental issues. The energy accounting system keeps track of energy in, energy out, and non-useful energy versus work done , and transformations within the system. Scientists have written and speculated on different aspects of energy accounting. Ecological economists agree that ecosystems produce enormous flows of goods and services to human beings, playing

13528-578: The GPI in 1995 was a modification of the 1994 version of the Index of Sustainable Economic Welfare in Daly and Cobb. Results showed that GDP increased substantially from 1950 to 1994. Over the same period, the GPI stagnated. Thus, according to GPI theory, economic growth in the US, i.e., the growth of GDP, did not increase the welfare of the people over that 44 year period. So far, GPI time-series have been calculated for

13706-418: The GPI of Vermont, Maryland, Colorado, Ohio, and Utah. These efforts have incited government action in some states. As of 2014, Vermont , Maryland , Washington and Hawai'i have passed state government initiatives to consider GPI in budgeting decisions, with a focus on long-term cost and benefits. Hawai'i's GPI spans the years from 2000 to 2020 and will be updated annually. In 2009, the state of Maryland formed

13884-399: The GPI seeks to correct this shorthand by providing a more encompassing measure. Some economists, notably Herman Daly , John B. Cobb and Philip Lawn , have asserted that a country's growth, increased goods production, and expanding services have both costs and benefits, not just the benefits that contribute to GDP. They assert that, in some situations, expanded production facilities damage

14062-418: The GPI. After the economic recession of the early-1990s the GDP continued to grow, but the GPI stayed on a lower level. This indicates a widening gap between the trends of GDP and GPI that began in the early-1990s. In the 1990s and 2000s the growth of GDP has not benefited the average Finn. If measured by GPI, sustainable economic welfare has actually decreased due to environmental hazards that have accumulated in

14240-575: The US and Australia as well as for several of their states. In addition, GPI has been calculated for Austria, Canada, Chile, France, Finland, Italy, the Netherlands, Scotland, and the rest of the UK. The GPI time-series 1945 to 2011 for Finland have been calculated by Statistics Finland . The calculation closely followed the US methodology. The results show that in the 1970s and 1980s economic growth, as measured by GDP, clearly increased welfare, measured by

14418-429: The above-mentioned factors easily benefits at least one other. For instance, photo voltaic (or solar) panels have a 15% efficiency when absorbing the sun's energy, but its construction demand has increased 120% within both commercial and residential properties. Additionally, this construction has led to a roughly 30% increase in work demands (Chen). The potential for the substitution of man-made capital for natural capital

14596-429: The above-mentioned factors easily benefits at least one other. For instance, photo voltaic (or solar) panels have a 15% efficiency when absorbing the sun's energy, but its construction demand has increased 120% within both commercial and residential properties. Additionally, this construction has led to a roughly 30% increase in work demands (Chen). The potential for the substitution of man-made capital for natural capital

14774-437: The costs and benefits (or profitability) of the various mechanisms for capturing and utilizing available energy to build biomass and do work. As a result, thermoeconomics is often discussed in the field of ecological economics, which itself is related to the fields of sustainability and sustainable development. Exergy analysis is performed in the field of industrial ecology to use energy more efficiently. The term exergy ,

14952-437: The costs and benefits (or profitability) of the various mechanisms for capturing and utilizing available energy to build biomass and do work. As a result, thermoeconomics is often discussed in the field of ecological economics, which itself is related to the fields of sustainability and sustainable development. Exergy analysis is performed in the field of industrial ecology to use energy more efficiently. The term exergy ,

15130-401: The costs borne by the society as a whole to repair or control pollution and poverty, GPI balances GDP spending against external costs. GPI advocates claim that it can more reliably measure economic progress, as it distinguishes between the overall "shift in the 'value basis' of a product, adding its ecological impacts into the equation". Comparatively speaking, the relationship between GDP and GPI

15308-698: The costs of small changes in risk to life–such as exposure to one pollutant. Economics, in principle, assumes that conflict is reduced by agreeing on voluntary contractual relations and prices instead of simply fighting or coercing or tricking others into providing goods or services. In doing so, a provider agrees to surrender time and take bodily risks and other (reputation, financial) risks. Ecosystems are no different from other bodies economically except insofar as they are far less replaceable than typical labour or commodities. Despite these issues, many ecologists and conservation biologists are pursuing ecosystem valuation . Biodiversity measures in particular appear to be

15486-698: The costs of small changes in risk to life–such as exposure to one pollutant. Economics, in principle, assumes that conflict is reduced by agreeing on voluntary contractual relations and prices instead of simply fighting or coercing or tricking others into providing goods or services. In doing so, a provider agrees to surrender time and take bodily risks and other (reputation, financial) risks. Ecosystems are no different from other bodies economically except insofar as they are far less replaceable than typical labour or commodities. Despite these issues, many ecologists and conservation biologists are pursuing ecosystem valuation . Biodiversity measures in particular appear to be

15664-417: The costs of the pollution they create (rather than having the government or society at large bear those costs) "by taxing their goods proportionally to their negative ecological and social impacts". GPI is an attempt to measure whether the environmental impact and social costs of economic production and consumption in a country are negative or positive factors in overall health and well-being. By accounting for

15842-530: The current neoliberal economic system as a source of this issue. The most cogent example of how the different theories treat similar assets is tropical rainforest ecosystems, most obviously the Yasuni region of Ecuador . While this area has substantial deposits of bitumen it is also one of the most diverse ecosystems on Earth and some estimates establish it has over 200 undiscovered medical substances in its genomes – most of which would be destroyed by logging

16020-477: The current neoliberal economic system as a source of this issue. The most cogent example of how the different theories treat similar assets is tropical rainforest ecosystems, most obviously the Yasuni region of Ecuador . While this area has substantial deposits of bitumen it is also one of the most diverse ecosystems on Earth and some estimates establish it has over 200 undiscovered medical substances in its genomes – most of which would be destroyed by logging

16198-517: The dark; the Alberta GPI created by ecological economist Mark Anielski to measure the long-term economic, social and environmental sustainability of the province of Alberta and the "environmental and sustainable development indicators" used by the Government of Canada to measure its own progress to achieving well-being goals. The Canadian Environmental Sustainability Indicators program

16376-462: The development and modern history of ecological economics and explain its differentiation from resource and environmental economics, as well as some of the controversy between American and European schools of thought. An article by Robert Costanza , David Stern, Lining He, and Chunbo Ma responded to a call by Mick Common to determine the foundational literature of ecological economics by using citation analysis to examine which books and articles have had

16554-462: The development and modern history of ecological economics and explain its differentiation from resource and environmental economics, as well as some of the controversy between American and European schools of thought. An article by Robert Costanza , David Stern, Lining He, and Chunbo Ma responded to a call by Mick Common to determine the foundational literature of ecological economics by using citation analysis to examine which books and articles have had

16732-516: The development terminology in his book Development Betrayed . Well-being in ecological economics is also differentiated from welfare as found in mainstream economics and the 'new welfare economics' from the 1930s which informs resource and environmental economics. This entails a limited preference utilitarian conception of value i.e., 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. Ecological economics

16910-516: The development terminology in his book Development Betrayed . Well-being in ecological economics is also differentiated from welfare as found in mainstream economics and the 'new welfare economics' from the 1930s which informs resource and environmental economics. This entails a limited preference utilitarian conception of value i.e., 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. Ecological economics

17088-418: The ecological footprint of human interactions in the economy. This footprint is measured by the impact of human activities on natural resources and the waste generated in the process. Ecological economists aim to minimize the ecological footprint, taking into account the scarcity of global and regional resources and their accessibility to an economy. Some ecological economists prioritise adding natural capital to

17266-418: The ecological footprint of human interactions in the economy. This footprint is measured by the impact of human activities on natural resources and the waste generated in the process. Ecological economists aim to minimize the ecological footprint, taking into account the scarcity of global and regional resources and their accessibility to an economy. Some ecological economists prioritise adding natural capital to

17444-466: The economy as a subsystem of Earth's larger ecosystem, and by emphasizing the preservation of natural capital , the field of ecological economics is differentiated from environmental economics , which is the mainstream economic analysis of the environment. One survey of German economists found that ecological and environmental economics are different schools of economic thought , with ecological economists emphasizing strong sustainability and rejecting

17622-666: The economy as pollution and waste. The potential of an environment to provide services and materials is referred to as an "environment's source function", and this function is depleted as resources are consumed or pollution contaminates the resources. The "sink function" describes an environment's ability to absorb and render harmless waste and pollution: when waste output exceeds the limit of the sink function, long-term damage occurs. Some persistent pollutants, such as some organic pollutants and nuclear waste are absorbed very slowly or not at all; ecological economists emphasize minimizing "cumulative pollutants". Pollutants affect human health and

17800-666: The economy as pollution and waste. The potential of an environment to provide services and materials is referred to as an "environment's source function", and this function is depleted as resources are consumed or pollution contaminates the resources. The "sink function" describes an environment's ability to absorb and render harmless waste and pollution: when waste output exceeds the limit of the sink function, long-term damage occurs. Some persistent pollutants, such as some organic pollutants and nuclear waste are absorbed very slowly or not at all; ecological economists emphasize minimizing "cumulative pollutants". Pollutants affect human health and

17978-634: The ecosystem. This train of thought respects physical bio-limits and non-human species, pursuing equity and social justice through direct democracy and grassroots leadership. Social well-being is paired with spiritual, physical, and material well-being. These movements are unique to their region, but the values can be seen across the globe in indigenous traditions, such as the Ubuntu Philosophy in South Africa. Ecological economics differs from mainstream economics in that it heavily reflects on

18156-506: The ecosystem. This train of thought respects physical bio-limits and non-human species, pursuing equity and social justice through direct democracy and grassroots leadership. Social well-being is paired with spiritual, physical, and material well-being. These movements are unique to their region, but the values can be seen across the globe in indigenous traditions, such as the Ubuntu Philosophy in South Africa. Ecological economics differs from mainstream economics in that it heavily reflects on

18334-507: The ecosystems upon which it relies. Ecological economics makes a clear distinction between growth (quantitative increase in economic output) and development (qualitative improvement of the quality of life ), while arguing that neoclassical economics confuses the two. Ecological economists point out that beyond modest levels, increased per-capita consumption (the typical economic measure of "standard of living") may not always lead to improvement in human well-being, but may have harmful effects on

18512-507: The ecosystems upon which it relies. Ecological economics makes a clear distinction between growth (quantitative increase in economic output) and development (qualitative improvement of the quality of life ), while arguing that neoclassical economics confuses the two. Ecological economists point out that beyond modest levels, increased per-capita consumption (the typical economic measure of "standard of living") may not always lead to improvement in human well-being, but may have harmful effects on

18690-634: The environment and broader societal well-being. This situation is sometimes referred to as uneconomic growth (see diagram above). Ecological economics challenges the conventional approach towards natural resources, claiming that it undervalues natural capital by considering it as interchangeable with human-made capital—labor and technology. The impending depletion of natural resources and increase of climate-changing greenhouse gasses should motivate us to examine how political, economic and social policies can benefit from alternative energy. Shifting dependence on fossil fuels with specific interest within just one of

18868-634: The environment and broader societal well-being. This situation is sometimes referred to as uneconomic growth (see diagram above). Ecological economics challenges the conventional approach towards natural resources, claiming that it undervalues natural capital by considering it as interchangeable with human-made capital—labor and technology. The impending depletion of natural resources and increase of climate-changing greenhouse gasses should motivate us to examine how political, economic and social policies can benefit from alternative energy. Shifting dependence on fossil fuels with specific interest within just one of

19046-420: The environment, into three main categories. These are the mainstream new resource economists, the new environmental pragmatists, and the more radical social ecological economists. International survey work comparing the relevance of the categories for mainstream and heterodox economists shows some clear divisions between environmental and ecological economists. A growing field of radical social-ecological theory

19224-420: The environment, into three main categories. These are the mainstream new resource economists, the new environmental pragmatists, and the more radical social ecological economists. International survey work comparing the relevance of the categories for mainstream and heterodox economists shows some clear divisions between environmental and ecological economists. A growing field of radical social-ecological theory

19402-657: The environment. The Finnish GPI time series have been updated by Dr Jukka Hoffrén at Statistics Finland. Within EU's Interreg IV C FRESH Project (Forwarding Regional Environmental Sustainable Hierarchies) GPI time-series were calculated to Päijät-Häme, Kainuu and South-Ostrobotnia (Etelä-Pohjanmaa) regions in 2009–2010. During 2011 these calculations were completed with GPI calculations for the Lappland, Northern Ostrobothnia (Pohjois-Pohjanmaa) and Central-Ostrobothnia (Keski-Pohjanmaa) regions. GPI considers some types of production to have

19580-556: The exception of Daly. In 1987, Daly and Costanza edited an issue of Ecological Modeling to test the waters. A book entitled Ecological Economics , by Joan Martinez Alier , was published later that year. Alier renewed interest in the approach developed by Otto Neurath during the interwar period . The year 1989 saw the foundation of the International Society for Ecological Economics and publication of its journal, Ecological Economics , by Elsevier . Robert Costanza

19758-484: The exception of Daly. In 1987, Daly and Costanza edited an issue of Ecological Modeling to test the waters. A book entitled Ecological Economics , by Joan Martinez Alier , was published later that year. Alier renewed interest in the approach developed by Otto Neurath during the interwar period . The year 1989 saw the foundation of the International Society for Ecological Economics and publication of its journal, Ecological Economics , by Elsevier . Robert Costanza

19936-594: The field. Some are close to resource and environmental economics while others are far more heterodox in outlook. An example of the latter is the European Society for Ecological Economics . An example of the former is the Swedish Beijer International Institute of Ecological Economics. Clive Spash has argued for the classification of the ecological economics movement, and more generally work by different economic schools on

20114-432: The field. Some are close to resource and environmental economics while others are far more heterodox in outlook. An example of the latter is the European Society for Ecological Economics . An example of the former is the Swedish Beijer International Institute of Ecological Economics. Clive Spash has argued for the classification of the ecological economics movement, and more generally work by different economic schools on

20292-494: The forest or mining the bitumen. Effectively, the instructional capital of the genomes is undervalued by analyses that view the rainforest primarily as a source of wood, oil/tar and perhaps food. Increasingly the carbon credit for leaving the extremely carbon-intensive ("dirty") bitumen in the ground is also valued – the government of Ecuador set a price of US$ 350M for an oil lease with the intent of selling it to someone committed to never exercising it at all and instead preserving

20470-494: The forest or mining the bitumen. Effectively, the instructional capital of the genomes is undervalued by analyses that view the rainforest primarily as a source of wood, oil/tar and perhaps food. Increasingly the carbon credit for leaving the extremely carbon-intensive ("dirty") bitumen in the ground is also valued – the government of Ecuador set a price of US$ 350M for an oil lease with the intent of selling it to someone committed to never exercising it at all and instead preserving

20648-483: The global ecosystem in 1997. Initially published in Nature , the article concluded on $ 33 trillion with a range from $ 16 trillion to $ 54 trillion (in 1997, total global GDP was $ 27 trillion). Half of the value went to nutrient cycling . The open oceans, continental shelves, and estuaries had the highest total value, and the highest per-hectare values went to estuaries, swamps/floodplains, and seagrass/algae beds. The work

20826-431: The global ecosystem in 1997. Initially published in Nature , the article concluded on $ 33 trillion with a range from $ 16 trillion to $ 54 trillion (in 1997, total global GDP was $ 27 trillion). Half of the value went to nutrient cycling . The open oceans, continental shelves, and estuaries had the highest total value, and the highest per-hectare values went to estuaries, swamps/floodplains, and seagrass/algae beds. The work

21004-412: The green economy denote a fundamental shift for more effective, resourceful, environment-friendly and resource‐saving technologies that could lessen emissions and alleviate the adverse consequences of climate change , at the same time confront issues about resource exhaustion and grave environmental dilapidation. As an indispensable requirement and vital precondition to realizing sustainable development,

21182-412: The green economy denote a fundamental shift for more effective, resourceful, environment-friendly and resource‐saving technologies that could lessen emissions and alleviate the adverse consequences of climate change , at the same time confront issues about resource exhaustion and grave environmental dilapidation. As an indispensable requirement and vital precondition to realizing sustainable development,

21360-731: The gross domestic product over time—that is, by adding up the annual dollar value of all goods and services produced within a country over successive years. However, GDP was not intended to be used for such purpose. It is prone to productivism or consumerism , over-valuing production and consumption of goods, and not reflecting improvement in human well-being. It also does not distinguish between money spent for new production and money spent to repair negative outcomes from previous expenditure. For example, it would treat as equivalent one million dollars spent to build new homes and one million dollars spent in aid relief to those whose homes have been destroyed, despite these expenditures arguably not representing

21538-447: The growth of efficient systems as the alienation of nature and man. Economic movements like degrowth reject the idea of growth itself. Some degrowth theorists call for an "exit of the economy". Critics of the degrowth movement include new resource economists, who point to the gaining momentum of sustainable development. These economists highlight the positive aspects of a green economy, which include equitable access to renewable energy and

21716-447: The growth of efficient systems as the alienation of nature and man. Economic movements like degrowth reject the idea of growth itself. Some degrowth theorists call for an "exit of the economy". Critics of the degrowth movement include new resource economists, who point to the gaining momentum of sustainable development. These economists highlight the positive aspects of a green economy, which include equitable access to renewable energy and

21894-408: The health of the ecosystem. The economic value of natural capital and ecosystem services is accepted by mainstream environmental economics, but is emphasized as especially important in ecological economics. Ecological economists may begin by estimating how to maintain a stable environment before assessing the cost in dollar terms. Ecological economist Robert Costanza led an attempted valuation of

22072-408: The health of the ecosystem. The economic value of natural capital and ecosystem services is accepted by mainstream environmental economics, but is emphasized as especially important in ecological economics. Ecological economists may begin by estimating how to maintain a stable environment before assessing the cost in dollar terms. Ecological economist Robert Costanza led an attempted valuation of

22250-548: The health, culture, and welfare of people. Growth that was in excess of sustainable norms (e.g., of ecological yield ) had to be considered to be uneconomic. According to the "threshold hypothesis", developed by Manfred Max-Neef , "when macroeconomic systems expand beyond a certain size, the additional benefits of growth are exceeded by the attendant costs" (Max-Neef, 1995). This hypothesis is borne out in data comparing GDP/capita with GPI/capita from 17 countries. The graph demonstrates that, while GDP does increase overall well-being to

22428-409: The human aspects and natural influences and an economic order that can generate high-salary jobs. In 2011, its definition was further developed as the word 'green' is made to refer to an economy that is not only resourceful and well-organized but also impartial, guaranteeing an objective shift to an economy that is low-carbon, resource-efficient, and socially-inclusive . The ideas and studies regarding

22606-409: The human aspects and natural influences and an economic order that can generate high-salary jobs. In 2011, its definition was further developed as the word 'green' is made to refer to an economy that is not only resourceful and well-organized but also impartial, guaranteeing an objective shift to an economy that is low-carbon, resource-efficient, and socially-inclusive . The ideas and studies regarding

22784-555: The human economy. The neoclassical view ignores much of what the natural sciences have taught us about the contributions of nature to the creation of wealth e.g., 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,

22962-555: The human economy. The neoclassical view ignores much of what the natural sciences have taught us about the contributions of nature to the creation of wealth e.g., 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,

23140-432: The instrumentalism of shallow ecology and the environmental economists commodification of everything external to the market system. A simple circular flow of income diagram is replaced in ecological economics by a more complex flow diagram reflecting the input of solar energy, which sustains natural inputs and environmental services which are then used as units of production . Once consumed, natural inputs pass out of

23318-432: The instrumentalism of shallow ecology and the environmental economists commodification of everything external to the market system. A simple circular flow of income diagram is replaced in ecological economics by a more complex flow diagram reflecting the input of solar energy, which sustains natural inputs and environmental services which are then used as units of production . Once consumed, natural inputs pass out of

23496-502: The mean of a car's velocity and the amount of fuel left. They add that it indeed seems as if the economy has to grow in order for the people to even remain as happy as they are at present. In Japan, for example, the degree of happiness expressed by the citizens in polls has been declining since the early 1990s, the period when Japan's economic growth stagnated. Ecological economics Organizations: Ecological economics , bioeconomics , ecolonomy , eco-economics , or ecol-econ

23674-473: The most influence on the development of the field. However, citations analysis has itself proven controversial and similar work has been criticized by Clive Spash for attempting to pre-determine what is regarded as influential in ecological economics through study design and data manipulation. In addition, the journal Ecological Economics has itself been criticized for swamping the field with mainstream economics. Various competing schools of thought exist in

23852-473: The most influence on the development of the field. However, citations analysis has itself proven controversial and similar work has been criticized by Clive Spash for attempting to pre-determine what is regarded as influential in ecological economics through study design and data manipulation. In addition, the journal Ecological Economics has itself been criticized for swamping the field with mainstream economics. Various competing schools of thought exist in

24030-556: The most promising way to reconcile financial and ecological values, and there are many active efforts in this regard. The growing field of biodiversity finance began to emerge in 2008 in response to many specific proposals such as the Ecuadoran Yasuni proposal or similar ones in the Congo . US news outlets treated the stories as a "threat" to "drill a park" reflecting a previously dominant view that NGOs and governments had

24208-438: The most promising way to reconcile financial and ecological values, and there are many active efforts in this regard. The growing field of biodiversity finance began to emerge in 2008 in response to many specific proposals such as the Ecuadoran Yasuni proposal or similar ones in the Congo . US news outlets treated the stories as a "threat" to "drill a park" reflecting a previously dominant view that NGOs and governments had

24386-403: The pest resistance is believed to be only a matter of time. Global warming is now widely acknowledged as a major issue, with all national scientific academies expressing agreement on the importance of the issue. As the population growth intensifies and energy demand increases, the world faces an energy crisis . Some economists and scientists forecast a global ecological crisis if energy use

24564-403: The pest resistance is believed to be only a matter of time. Global warming is now widely acknowledged as a major issue, with all national scientific academies expressing agreement on the importance of the issue. As the population growth intensifies and energy demand increases, the world faces an energy crisis . Some economists and scientists forecast a global ecological crisis if energy use

24742-566: The pollution is cleaned up; in contrast, GPI counts the initial pollution as a loss rather than a gain, generally equal to the amount it will cost to clean up later plus the cost of any negative impact the pollution will have in the meantime. While quantifying costs and benefits of these environmental and social externalities is a difficult task, "Earthster-type databases could bring more precision and currency to GPI's metrics." It has been noted that such data may also be embraced by those who attempt to "internalize externalities" by making companies pay

24920-425: The practical purpose of calculating income is to indicate the maximum amount that people can produce and consume without undermining their capacity to produce and consume the same amount in the future. From a national income perspective, it is necessary to answer the following question: "Can a nation's entire GDP be consumed without undermining its ability to produce and consume the same GDP in the future?" This question

25098-497: The prevailing belief of the economy as a perpetual motion machine, capable of generating infinite wealth—a criticism expanded upon by later ecological economists such as Nicholas Georgescu-Roegen and Herman Daly. European predecessors of ecological economics include K. William Kapp (1950) Karl Polanyi (1944), and Romanian economist Nicholas Georgescu-Roegen (1971). Georgescu-Roegen, who would later mentor Herman Daly at Vanderbilt University , provided ecological economics with

25276-497: The prevailing belief of the economy as a perpetual motion machine, capable of generating infinite wealth—a criticism expanded upon by later ecological economists such as Nicholas Georgescu-Roegen and Herman Daly. European predecessors of ecological economics include K. William Kapp (1950) Karl Polanyi (1944), and Romanian economist Nicholas Georgescu-Roegen (1971). Georgescu-Roegen, who would later mentor Herman Daly at Vanderbilt University , provided ecological economics with

25454-472: The primary responsibility to protect ecosystems. However Peter Barnes and other commentators have recently argued that a guardianship/trustee/commons model is far more effective and takes the decisions out of the political realm. Commodification of other ecological relations as in carbon credit and direct payments to farmers to preserve ecosystem services are likewise examples that enable private parties to play more direct roles protecting biodiversity, but

25632-472: The primary responsibility to protect ecosystems. However Peter Barnes and other commentators have recently argued that a guardianship/trustee/commons model is far more effective and takes the decisions out of the political realm. Commodification of other ecological relations as in carbon credit and direct payments to farmers to preserve ecosystem services are likewise examples that enable private parties to play more direct roles protecting biodiversity, but

25810-401: The production of coal, oil and gas has declined over time as the easiest to produce sources have been most heavily depleted. In traditional energy economics, surplus energy is often seen as something to be capitalized on—either by storing for future use or by converting it into economic growth. Ecological economics generally rejects the view of energy economics that growth in the energy supply

25988-401: The production of coal, oil and gas has declined over time as the easiest to produce sources have been most heavily depleted. In traditional energy economics, surplus energy is often seen as something to be capitalized on—either by storing for future use or by converting it into economic growth. Ecological economics generally rejects the view of energy economics that growth in the energy supply

26166-411: The proposition that physical (human-made) capital can substitute for natural capital (see the section on weak versus strong sustainability below). Ecological economics was founded in the 1980s as a modern discipline on the works of and interactions between various European and American academics (see the section on History and development below). The related field of green economics is in general

26344-402: The rainforest. While this natural capital and ecosystems services approach has proven popular amongst many it has also been contested as failing to address the underlying problems with mainstream economics, growth, market capitalism and monetary valuation of the environment. Critiques concern the need to create a more meaningful relationship with Nature and the non-human world than evident in

26522-402: The rainforest. While this natural capital and ecosystems services approach has proven popular amongst many it has also been contested as failing to address the underlying problems with mainstream economics, growth, market capitalism and monetary valuation of the environment. Critiques concern the need to create a more meaningful relationship with Nature and the non-human world than evident in

26700-556: The same kind of progress. This is relevant for example when considering the true costs of development that destroys wetlands and hence exacerbates flood damages. Simon Kuznets , the inventor of the concept of GDP, noted in his first report to the US Congress in 1934: the welfare of a nation can scarcely be inferred from a measure of national income. In 1962, he also wrote: Distinctions must be kept in mind between quantity and quality of growth, between costs and returns, and between

26878-468: The sectors. Simultaneously, the educational system needs to be assessed as well in order to fit in the environmental and social considerations of various disciplines. Among the topics addressed by ecological economics are methodology, allocation of resources, weak versus strong sustainability, energy economics, energy accounting and balance, environmental services, cost shifting, modeling, and monetary policy. A primary objective of ecological economics (EE)

27056-468: The sectors. Simultaneously, the educational system needs to be assessed as well in order to fit in the environmental and social considerations of various disciplines. Among the topics addressed by ecological economics are methodology, allocation of resources, weak versus strong sustainability, energy economics, energy accounting and balance, environmental services, cost shifting, modeling, and monetary policy. A primary objective of ecological economics (EE)

27234-516: The separability of economic values from scientific research, contending that economics is unavoidably normative , i.e. prescriptive, rather than positive or descriptive. Positional analysis, which attempts to incorporate time and justice issues, is proposed as an alternative. Ecological economics shares several of its perspectives with feminist economics , including the focus on sustainability, nature, justice and care values. Karl Marx also commented on relationship between capital and ecology, what

27412-516: The separability of economic values from scientific research, contending that economics is unavoidably normative , i.e. prescriptive, rather than positive or descriptive. Positional analysis, which attempts to incorporate time and justice issues, is proposed as an alternative. Ecological economics shares several of its perspectives with feminist economics , including the focus on sustainability, nature, justice and care values. Karl Marx also commented on relationship between capital and ecology, what

27590-433: The short and long run... Goals for more growth should specify more growth of what and for what. Some have argued that an adequate measure must also take into account ecological yield and the ability of nature to provide services , and that these things are part of a more inclusive ideal of progress, which transcends the traditional focus on raw industrial production. The need for a GPI to supplement indicators such as GDP

27768-546: The social and ecological costs of the Post–World War II economic expansion . In 1880, Marxian economist Sergei Podolinsky attempted to theorize a labor theory of value based on embodied energy ; his work was read and critiqued by Marx and Engels . Otto Neurath developed an ecological approach based on a natural economy whilst employed by the Bavarian Soviet Republic in 1919. He argued that

27946-411: The social and ecological costs of the Post–World War II economic expansion . In 1880, Marxian economist Sergei Podolinsky attempted to theorize a labor theory of value based on embodied energy ; his work was read and critiqued by Marx and Engels . Otto Neurath developed an ecological approach based on a natural economy whilst employed by the Bavarian Soviet Republic in 1919. He argued that

28124-644: The typical capital asset analysis of land, labor, and financial capital. These ecological economists use tools from mathematical economics , as in mainstream economics, but may apply them more closely to the natural world. Whereas mainstream economists tend to be technological optimists, ecological economists are inclined to be technological sceptics. They reason that the natural world has a limited carrying capacity and that its resources may run out. Since destruction of important environmental resources could be practically irreversible and catastrophic, ecological economists are inclined to justify cautionary measures based on

28302-644: The typical capital asset analysis of land, labor, and financial capital. These ecological economists use tools from mathematical economics , as in mainstream economics, but may apply them more closely to the natural world. Whereas mainstream economists tend to be technological optimists, ecological economists are inclined to be technological sceptics. They reason that the natural world has a limited carrying capacity and that its resources may run out. Since destruction of important environmental resources could be practically irreversible and catastrophic, ecological economists are inclined to justify cautionary measures based on

28480-458: The view of a starry night sky, etc. There has then been a move to regard such things as natural capital and ecosystems functions as goods and services. However, this is far from uncontroversial within ecology or ecological economics due to the potential for narrowing down values to those found in mainstream economics and the danger of merely regarding Nature as a commodity. This has been referred to as ecologists 'selling out on Nature'. There

28658-458: The view of a starry night sky, etc. There has then been a move to regard such things as natural capital and ecosystems functions as goods and services. However, this is far from uncontroversial within ecology or ecological economics due to the potential for narrowing down values to those found in mainstream economics and the danger of merely regarding Nature as a commodity. This has been referred to as ecologists 'selling out on Nature'. There

28836-431: The western development model of economics. Meaning G ood Life , Buen Vivir emphasizes harmony with nature, diverse pluralculturism, coexistence, and inseparability of nature and material. Value is not attributed to material accumulation, and it instead takes a more spiritual and communitarian approach to economic activity. Ecological Swaraj originated out of India, and is an evolving world view of human interactions within

29014-431: The western development model of economics. Meaning G ood Life , Buen Vivir emphasizes harmony with nature, diverse pluralculturism, coexistence, and inseparability of nature and material. Value is not attributed to material accumulation, and it instead takes a more spiritual and communitarian approach to economic activity. Ecological Swaraj originated out of India, and is an evolving world view of human interactions within

29192-584: The world have begun to be included as ecological economic practices. E.F. Schumacher introduced examples of non-western economic ideas to mainstream thought in his book, Small is Beautiful , where he addresses neoliberal economics through the lens of natural harmony in Buddhist economics . This emphasis on natural harmony is witnessed in diverse cultures across the globe. Buen Vivir is a traditional socio-economic movement in South America that rejects

29370-466: The world have begun to be included as ecological economic practices. E.F. Schumacher introduced examples of non-western economic ideas to mainstream thought in his book, Small is Beautiful , where he addresses neoliberal economics through the lens of natural harmony in Buddhist economics . This emphasis on natural harmony is witnessed in diverse cultures across the globe. Buen Vivir is a traditional socio-economic movement in South America that rejects

29548-428: The world transport network: The US, UK, Canada and Australia. Ecological economics Organizations: Ecological economics , bioeconomics , ecolonomy , eco-economics , or ecol-econ is both a transdisciplinary and an interdisciplinary field of academic research addressing the interdependence and coevolution of human economies and natural ecosystems , both intertemporally and spatially. By treating

29726-485: The worst land abuses for instance have been shrimp farming operations that destroyed mangroves, evicted families, left coastal lands salted and useless for agriculture, but generated a significant cash profit for those who were able to control the export market in shrimp. This has become a signal example to those who contest the idea that GDP growth is necessarily desirable. GPI systems generally try to take account of these problems by incorporating sustainability : whether

29904-425: Was coined by Zoran Rant in 1956, but the concept was developed by J. Willard Gibbs . In recent decades, utilization of exergy has spread outside of physics and engineering to the fields of industrial ecology, ecological economics, systems ecology , and energetics . An energy balance can be used to track energy through a system, and is a very useful tool for determining resource use and environmental impacts, using

30082-425: Was coined by Zoran Rant in 1956, but the concept was developed by J. Willard Gibbs . In recent decades, utilization of exergy has spread outside of physics and engineering to the fields of industrial ecology, ecological economics, systems ecology , and energetics . An energy balance can be used to track energy through a system, and is a very useful tool for determining resource use and environmental impacts, using

30260-640: Was criticized by articles in Ecological Economics Volume 25, Issue 1, but the critics acknowledged the positive potential for economic valuation of the global ecosystem. The Earth's carrying capacity is a central issue in ecological economics. Early economists such as Thomas Malthus pointed out the finite carrying capacity of the earth, which was also central to the MIT study Limits to Growth . Diminishing returns suggest that productivity increases will slow if major technological progress

30438-511: Was criticized by articles in Ecological Economics Volume 25, Issue 1, but the critics acknowledged the positive potential for economic valuation of the global ecosystem. The Earth's carrying capacity is a central issue in ecological economics. Early economists such as Thomas Malthus pointed out the finite carrying capacity of the earth, which was also central to the MIT study Limits to Growth . Diminishing returns suggest that productivity increases will slow if major technological progress

30616-548: Was expanding the economy but degrading life. The matter remains controversial and is a main issue between advocates of green economics and neoclassical economics . Neoclassical economists understand the limitations of GDP for measuring human well-being but nevertheless regard GDP as an important, though imperfect, measure of economic output and would be wary of too close an identification of GDP growth with aggregate human welfare. However, GDP tends to be reported as synonymous with economic progress by journalists and politicians, and

30794-758: Was founded in the 1980s as a modern discipline on the works of and interactions between various European and American academics (see the section on History and development below). The related field of green economics is in general a more politically applied form of the subject. According to ecological economist Malte Michael Faber  [ de ] , ecological economics is defined by its focus on nature, justice, and time. Issues of intergenerational equity , irreversibility of environmental change, uncertainty of long-term outcomes, and sustainable development guide ecological economic analysis and valuation. Ecological economists have questioned fundamental mainstream economic approaches such as cost-benefit analysis , and

30972-493: Was highlighted by analyses of uneconomic growth in the 1980s, notably that of Marilyn Waring , who studied biases in the UN System of National Accounts . By the early 1990s, there was a consensus in human development theory and ecological economics that growth in money supply was actually reflective of a loss of well-being: that shortfalls in essential natural and social services were being paid for in cash and that this

31150-545: Was published just a few years before the first edition of Herman Daly 's comprehensive and persuasive Steady-State Economics (1977). The first organized meetings of ecological economists occurred in the 1980s. These began in 1982, at the instigation of Lois Banner, with a meeting held in Sweden (including Robert Costanza , Herman Daly , Charles Hall , Bruce Hannon, H.T. Odum , and David Pimentel). Most were ecosystem ecologists or mainstream environmental economists, with

31328-492: Was published just a few years before the first edition of Herman Daly 's comprehensive and persuasive Steady-State Economics (1977). The first organized meetings of ecological economists occurred in the 1980s. These began in 1982, at the instigation of Lois Banner, with a meeting held in Sweden (including Robert Costanza , Herman Daly , Charles Hall , Bruce Hannon, H.T. Odum , and David Pimentel). Most were ecosystem ecologists or mainstream environmental economists, with

31506-531: Was the first president of the society and first editor of the journal, which is currently edited by Richard Howarth. Other figures include ecologists C.S. Holling and H.T. Odum , biologist Gretchen Daily, and physicist Robert Ayres . In the Marxian tradition, sociologist John Bellamy Foster and CUNY geography professor David Harvey explicitly center ecological concerns in political economy . Articles by Inge Ropke (2004, 2005) and Clive Spash (1999) cover

31684-477: Was the first president of the society and first editor of the journal, which is currently edited by Richard Howarth. Other figures include ecologists C.S. Holling and H.T. Odum , biologist Gretchen Daily, and physicist Robert Ayres . In the Marxian tradition, sociologist John Bellamy Foster and CUNY geography professor David Harvey explicitly center ecological concerns in political economy . Articles by Inge Ropke (2004, 2005) and Clive Spash (1999) cover

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