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 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.Jeroen C.J.M. van den Bergh (2001). "Ecological Economics: Themes, Approaches, and Differences with Environmental Economics," Regional Environmental Change, 2(1), pp. 13-23 (press +). 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).Illge L, Schwarze R. (2006). A Matter of Opinion: How Ecological and Neoclassical Environmental Economists Think about Sustainability and Economics . German Institute for Economic Research.
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 a more politically applied form of the subject.Paehlke R. (1995). Conservation and Environmentalism: An Encyclopedia, p. 315. Taylor & Francis.Scott Cato, M. (2009). Green Economics. Earthscan, London. .
According to ecological economist , 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.Malte Faber. (2008). How to be an ecological economist. Ecological Economics 66(1):1-7. Preprint. Ecological economists have questioned fundamental mainstream economic approaches such as cost-benefit analysis, and 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.Mattson L. (1975). Book Review: Positional Analysis for Decision-Making and Planning by Peter Soderbaum. The Swedish Journal of Economics.Soderbaum, P. 2008. Understanding Sustainability Economics. Earthscan, London. . pp.109-110, 113-117. 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 is now known as ecosocialism.
History and development 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 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 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 Friedrich Hayek in what became known as the socialist calculation debate.Cartwright Nancy, J. Cat, L. Fleck, and T. Uebel, 1996. Otto Neurath: philosophy between science and politics. Cambridge University Press
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 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.Zencey, Eric. (2009, April 12). Op-ed. New York Times, p. WK9. Accessed: December 23, 2012.
European predecessors of ecological economics include K. William Kapp (1950)Kapp, K. W. (1950) The Social Costs of Private Enterprise. New York: Shocken. Karl Polanyi (1944),Polanyi, K. (1944) The Great Transformation. New York/Toronto: Rinehart & Company Inc. and Romanian economist Nicholas Georgescu-Roegen (1971). Georgescu-Roegen, who would later mentor Herman Daly at Vanderbilt University, provided ecological economics with 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) was published just a few years before the first edition of Herman Daly's comprehensive and persuasive Steady-State Economics (1977).Schumacher, E.F. 1973. Small Is Beautiful: A Study of Economics as if People Mattered. London: Blond and Briggs.Daly, H. 1991. Steady-State Economics (2nd ed.). Washington, D.C.: Island Press.
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 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.Costanza R. (2003). Early History of Ecological Economics and ISEE. Internet Encyclopaedia of Ecological Economics. Alier renewed interest in the approach developed by Otto Neurath during the interwar period.Martinez-Alier J. (1987)Ecological economics: energy, environment and society The year 1989 saw the foundation of the International Society for Ecological Economics and publication of its journal, Ecological Economics, by Elsevier. Robert Costanza 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 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 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.
Schools of thought Various competing schools of thought exist in 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 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 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 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 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.
Non-traditional approaches to ecological economics