Ecological economics, degrowth, and institutional change
2012
Klitgaard, Kent A. | Krall, Lisi
Ecological economics has made great strides in the understanding of how the human economy is embedded in a finite and limited biophysical system. However less progress has been made in understanding the internal dynamics of the economy that produce periods of slow growth, even in the absence of biophysical constraints. The real economy is a complex system, replete with myriad positive feedback loops. By looking at the economy from a systems perspective ecological economists can better understand the internal dynamics of a market system that lead to the periodic depressions and recessions that characterize “the failed growth economy.” A non-growing or declining economy exacerbates formidable economic problems such as unemployment, debt, and poverty. Since the middle of the 20th century governments have pursued growth strategies to solve social problems. But the age of economic growth is coming to an end, driven by its own internal dynamics and by biophysical forces such as climate change and peak oil. Degrowth implies less, and the steady state implies less on a permanent basis. Ecological economists need to pay more attention to the implications of less for a market economy and the effects upon people under our present economic configuration.
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