ecological economics – what is it, and what differs it from environmental economics? Eva Friman 2011

the concept of economic growth as a paradigm shift in economic thought in the 1950s classical economicsneoclassical economics ontology time- and space bound national wealth wealth universal in time and space epistemology/ theory economics as normative/ contextualization (concrete and specific) economics as value- neutral/ de-contextualization (abstract and general) conclusion on limits limited economic expansion unlimited economic growth Eva Friman 2011

modernist economic discourse Eva Friman 2011

neoclassical economics Eva Friman 2011

classical theory institutional theory Eva Friman 2011

basic assumptions environmental economics ecological economic one-dimensional human nature multi-dimensional human nature insatiable needs satiable needs, insatiable wants efficiency in focus; distribution and equity secondary (if that) distribution and equity in focus; efficiency secondary nature as instrumental – value if value given nature as intrinsically valuable scarcity as budget restrictions scarcity as physical restrictions Eva Friman 2011

needs & wants needssatiable, must be satisfied to survive wantsinsatiable, must not be satisfied to survive Eva Friman 2011

basic assumptions environmental economics ecological economics economy as autonomous economy as subsystem to ecology environment as choice of consumption environment as basis for consumption optimizing allocation and externalities optimizing physical scale environmental crisis as result of lack of clearly defined property rights and non- priced externalities environmental crisis as result of a free-floating economic system Eva Friman 2011

weak and strong sustainability natural capital cultural capital human made capital – substitutes or complements? Eva Friman 2011

weak and strong sustainability substitutes complements weak sustainabilitystrong sustainability (priority to efficiency) (priority to sustainability) keeping total capital intact keeping intact human made and natural capital separately, plus current situation means natural capital needs to grow Eva Friman 2011

environmental economics ecological economics – pricing the environment – defining property rights (i.e. reforming neoclassical theory) – environmental investments – redistributing wealth (global North/global South) (investing in nature/natural capital, reducing through-put, i.e. GDP) Eva Friman 2011

environ. econ. sustainability ecol. econ. sustainability weak sustainability sustainable economic growth (change in high-income countries’ T; eco-modernism) strong sustainability non-growing through-put (change in high-income countries’ T and A; eco-logism) Eva Friman 2011

GDP and ISEW Eva Friman 2011