Chapter 23: Ecological Economics
23.1 Economic Worldviews
• Can development be sustainable?
• Our definitions of resources shape how we use
them
• Classical economics examines supply and demand
• Neoclassical economics emphasizes growth
• Ecological economics incorporates principles of
ecology
• Communal property resources are a classic
problem in ecological economics
Freedom and Growth
• 1200-1500 Growth in European internal
markets
• 1500-1900 Territorial Expansion
• 1700-2000 Scientific and Technological
Expansion
• Everyone gets a Bigger Slice
• Can Freedom Exist in a Zero-Sum World?
The Laffer
Curve
23.2 Population, Technology, And
Scarcity
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Scarcity can lead to innovation
Carrying capacity is not necessarily fixed
Economic models compare growth scenarios
Why not conserve resources?
23.3 Natural Resource Accounting
• Gross National (Domestic) product is our
dominant growth measure
• Alternate measures account for well-being
• New approaches incorporate nonmarket
values
– Nonmarket values can’t be spent in the
marketplace
• Cost-benefit analysis aims to optimize
resource use
23.4 Market Mechanisms Can Reduce
Pollution
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Using market forces
Is emissions trading the answer?
Sulfur trading offers a good model
Carbon trading is already at work
23.5 Trade, Development, and Jobs
• International trade brings benefits but also
intensifies inequities
– NAFTA
• Aid often doesn’t help the people who need it
– Theft, Misappropriation
– Inefficiency and Bureaucracy
– Ethnic, Religious and Class Rivalry
• Microlending helps the poorest of the poor
23.6 Green Business
• New business models follow concepts of
ecology
• Efficiency starts with design of products and
processes
• Green consumerism gives the public a voice
• Environmental protection creates jobs
• Personally Responsible Consumerism