Ecological economics: human progress as part of nature

599px-The_Blue_Marble“The term ‘ecological economics’ should be a little redundant, as both words share the Greek root oikos (household) and together mean something like household-study household-law. It is telling that the two fields of ecology and mainstream economics have grown so far apart in the century and a half since they were named that they now represent completely different sets of principles.

The basic idea of ecological economics can be summarised by [Herman] Daly‘s argument with the World Bank economists: when you draw the box for the economy, you have to put it in a larger box called the environment. The human economy is a subset of the world system. Our inputs, in terms of natural resources, and outputs, including pollution, are like the metabolism of a kind of super-organism. We can analyse it using the same kinds of tools as we use to analyse other living systems, such as a cell, or a beehive, or a complete ecosystem.

Instead of being a closed system, like a machine, the economy is open to the environment. Attention therefore shifts from the inner mechanics of the economy to big-picture questions related to things like scale and timing and the flow of energy. Is the economy becoming to big relative to its environment? Is it consuming resources at too fast a rate? Is it adequately disposing of its own waste? Is it endangering the food chain on which it depends for its survival?”

David Orrell (2010), Economyths: How the science of complex systems is transforming economic thought

But remember, it’s all just models within models within models. They are all we have, so if we are to sustain human progress, we need to build better ones: better at explanation, and better at laying out the options for responding to change.

Divisions between the economy, society and the environment are a simplification, and a potentially dangerous one. Ecological economics offers useful ways of thinking about the state and direction of humankind as part of nature, rather than its master. So too does sustainable development. In my view we also need a political economy approach to the environment which studies how the costs and benefits of change lead to potential conflict and particular distributions of power in society. These processes require management by governments working with each other and with civil society. Such issues are surely the most urgent of our times.

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3 thoughts on “Ecological economics: human progress as part of nature

  1. Does this guy seriously suggest that at some Golden Age the science of the “economy” rested on the same “sets of principles” as the science of “ecology” founded by the German zoologist Ernst Haeckel (1834-1919)? Just because two terms have the same etymological root does not prove that two subjects must be inspired and driven by the same logic. This sounds more like assiduous essay writing than a convincing argument.

    In fact, the guys who come closest to viewing the economy as an ecological order are the greatest villains in the eyes of the modern politically correct ecologists: Adam Smith and Friedrich Hayek and others that all belong in the free economy camp. But these laissez faire authors have never been as audacious to claim to be working – as economists – on the same principles as the science of ecology. And indeed, what today’s trendy ecologists suggest with regard to the economy (steering it right left and centre, rather than treating it as an organic growth and leaving it to itself) is analogous to genetic engineering in biology and chemistry. They treat the economy not as a spontaneous ecological order, not as “the natural environment” but as an engineering project.

    The brief quote contains a hotchpotch of generalities that do not at all suffice to give anyone an idea of what is the specific difference between economics [to be shunned] and ecological economics [to be (re?-)inaugurated].

    “We can analyse it [the economy] using the same kinds of tools as we use to analyse other living systems, such as a cell, or a beehive, or a complete ecosystem.” Not even Hayek would have been so foolish as to make such a claim – unless he might have tried a trick on his readers, whereby certain analogies between economics and the science of ecology, which exist on a general level, are presented as proof that the entire science of economics is systematically mistaken and can only be salvaged by substituting it through the science of ecology.

    • I think Orrell’s point is that the science of complex systems may be more appropriate to modelling in both ecology and economics and provides a bridge between the two. I admit that this may well not come across in the brief quote. The complex systems approach does not view any system as a machine which can be easily controlled and manipulated. It sets limits on how far we can make predictions and influence outcomes. But it can also potentially provide richer explanations of the operation and development of such systems.

      • “The complex systems approach does not view any system as a machine which can be easily controlled and manipulated. It sets limits on how far we can make predictions and influence outcomes. But it can also potentially provide richer explanations of the operation and development of such systems.”

        I agree.

        But do you find that kind of scientific conscientiousness and openness confirmed in actual green conduct? Claiming that the whole climate system of our planet is driven by one factor (CO2) strikes me as the height of mechanistic simplicity – the very opposite of an “open system approach”. Anyone who deviates from this simple tale is asked to shut up. “The science is settled,” they say. Sorry, that quite simply is not the scientific way, and certainly not an approach toward “richer explanations.”

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