the early history of modern ecological economics abstract this paper provides a historical perspective for the discussion on ecological economics as a special field of research by studying the historical background of ecological economics the present discussions and tensions inside the field might become easier to understand and to relate to the study is inspired by other studies of the emergence of new research areas done by sociologists and historians of science and includes both cognitive and social aspects macro trends and the role of individuals the basis for the paper is a combination of literature studies and interviews with key researchers from the field the story opens with the emergence of the new environmental agenda in the 1960s which was influenced by the scientific development in biology and ecology then it is outlined how the environmental challenge was met by economics in the 1960s around 1970 the basic ideas of ecological economics were given modern formulations but it took a long gestation period from the beginning of the 1970s to the end of the 1980s before ecological economics took shape during this gestation period the personal relationships between the actors were formed and the meetings that were decisive for the formal establishment of ecological economics took place

of goats and dogs joseph townsend and the idealisation of markets a decisive episode in the history of economics joseph townsend s dissertation on the poor laws 1786 played a major role in the development of economic thought its originality lies in the fact that the notion of competitive markets was defined as a natural law a principle of nature that should not be meddled with this principle was explained by describing the struggle for survival between goats and dogs on a remote pacific island the dissertation stands in the shadow of thomas malthus s essay on the principle of population yet malthus has been accused of plagiarising townsend i argue that an overlooked aspect in this debate is that townsend s dissertation and malthus s essay share a revolutionary methodology that removed the market mechanism from any cultural and social context in the name of science a feature that has been a part of market fundamentalist economics ever since

the new institutional economics this outstanding book presents new original contributions from some of the world s leading economists including ronald coase douglass c north masahiko aoki oliver e williamson and harold demsetz it demonstrates the extent and depth of the new institutional economics research programme which is having a worldwide impact on the economics profession

eco thermodynamics economics and the second law the laws of physics especially the first and second laws of thermodynamics have significant implications for economic theory the major implications of the first law conservation of mass energy are straightforward and have been discussed at length elsewhere in brief raw material inputs to economic processes are not consumed having been extracted from the environment in the first place they eventually return to the environment as wastes the economic implications of the second law entropy law are far more subtle there is considerable literature initiated by the work of georgescu roegen on the supposed constraints on economic growth imposed by the fact that economic processes utilize low entropy raw materials fossil fuels and high grade metal ores and discard high entropy wastes however as a practical matter the flux of available low entropy energy exergy from the sun is extremely large and certainly adequate to sustain economic activity in the solar system indefinitely even though fossil fuel and metal ore stocks may eventually be exhausted it is argued in this paper that the real economic significance of the second law lies in the fact that exergy is i not conserved and ii is a useful common measure of resource quality as well as quantity applicable to both materials and energy thus exergy can be used to measure and compare resource inputs and outputs including wastes and losses this is potentially important in itself moreover since exergy is not conserved it is truly consumed i e used up in economic processes hence exergy is no less a factor of production than labor or capital this fact has strong implications for economic growth theory especially with regard to assessing the role of technical progress

externalities a market model failure we focus here on a set of conceptual problems related to the accepted theory of externalities we are primarily concerned with difficulties that arise when a theoretical system is extended beyond its logical domain this is the practice in externality theory when the market model assuming independent agents is used to analyze physical interdependency the different kinds of dependencies obscure the standard use of the paretian analysis as the issues of rights and efficiency are mixed up the creation of emissions and the creation of externalities are further not held apart producing flows in the efficiency evaluations due to the interdependencies involved actions of both emitter and victim must be taken into account while searching for efficient policies finally we analyze the interrelationships between what is termed the internal structure of the market model and the annexed sphere of externalities we conclude that the accepted policy prescriptions both assume and demand no interrelationships between these two spheres we find the assumption unrealistic and inconsistent as concerns the basic foundations of the market model there are two main traditions addressing externalities the coasean and the pigovian this paper shows that both are vulnerable to the above critique thus the presumption that externality theory is now settled and coherent is seen to be without theoretical support

defining economics the long road to acceptance of the robbins definition robbins essay gave economics a definition that came to dominate the professional literature this definition laid a foundation that could be seen as justifying both the narrowing of economic theory to the theory of constrained maximization or rational choice and economists ventures into other social science fields though often presented as self evidently correct both the definition itself and the developments that it has been used to support were keenly contested this paper traces the reception diffusion and contesting of the robbins definition arguing that this process took around three decades and that even then there was still significant dissent

evolutionary theories in environmental and resource economics approaches and applications recent advances in evolutionary theory have important implications for environmental economics a short overview is offered of evolutionarythinking in economics subsequently major concepts and approaches inevolutionary biology and evolutionary economics are presented andcompared attention is devoted among others to darwinian selection punctuated equilibrium sorting mechanisms lamarckian evolution coevolution and self organization basic features of evolution such assustained change irreversible change unpredictability qualitativechange and disequilibrium are examined it is argued that there are anumber of fundamental differences as well as similarities betweenbiological and economic evolution next some general implications ofevolutionary thinking for environmental economics are outlined this isfollowed by a more detailed examination of potential uses ofevolutionary theories in specific areas of environmental economics including sustainability and long run development theories technologyand environment ecosystem management and resilience spatial evolutionand environmental processes and design of environmental policy

trends in the development of ecological economics from the late 1980s to the early 2000s abstract as the contributions to ecological economics are very diverse recent years have seen some discussion on both how to delimit the field and in which direction it should develop the intention with this paper is to contribute to the discussion by outlining important trends in the development of the field from the late 1980s to the early 2000s the study is inspired by other studies in the sociology and history of science in particular by the theoretical framework regarding scientific fields as reputational organizations which draws attention to both cognitive and social aspects of the formation of a field the basis for the paper is a combination of literature studies interviews with key researchers in the field and participant observations the paper outlines the characteristic cognitive features of ecological economics at the time of the birth of the field it is then described how the development in ecological economics was influenced by broader social factors during the following years and how the field was shaped by the inflow and outflow of different groups of researchers the emergence of different research programmes is outlined as is the organizational development finally the characteristics of ecological economics are summarized and the future prospects are briefly assessed

a long view of real rates in light of the large and sustained rise in real interest rates in the late 1970s and early 1980s this paper reviews i the theoretical discussion on the determination of nominal and real interest rates ii the factors determining real interest rates and iii problems of defining and measuring the real rate we go on to examine the historical record of real interest rates in france germany the uk and the usa since 1875 we find that high real rates since 1980 seem to be a return to a long run norm and it is the period from the second world war to 1979 that represents a more natural period in which to investigate an abrupt change of behaviour for real interest rates copyright 1999 by oxford university press

identifying fiscal policy in effectiveness from the differential counter cyclicality of government spending in the interwar period differences across decades in the counter cyclical stance of fiscal policy can identify whether the growth in government spending affects output growth and so speeds recovery from a recession we study government spending reaction functions from the 1920s and 1930s for twenty countries there are two main findings first surprisingly government spending was less counter cyclical in the 1930s than in the 1920s second the growth of government spending did not have a significant effect on output growth so that there is little evidence that this feature of fiscal policy played a stabilizing role in the interwar period resume identifier le caractere effectif ou non de la politique fiscale a partir de la contra cyclicite differentielle des depenses gouvernementales pendant l entre deux guerres des differences dans le degre de contra cyclicite de la politique budgetaire peuvent servir a identifier si la croissance des depenses publiques a un effet sur la croissance de l output et accelere ainsi la reprise de l activite suivant une recession nous etudions des fonctions de reaction des depenses publiques pour les annees 1920 et 1930 ce pour vingt pays il en ressort deux resultats principaux premierement et fait surprenant les depenses publiques etaient moins contra cycliques durant les annees 1930 que 1920 deuxiemement la croissance des depenses publiques n a pas eu d effet significatif sur la croissance de l output ce qui permet de douter que cet aspect de la politique budgetaire ait joue un role stabilisateur durant l entre guerre

k william kapp s theory of social costs and environmental policy towards political ecological economics abstract the paper analyzes the contribution of k william kapp widely considered one of the founders of ecological economics this paper will demonstrate how k william kapp developed his theory of social costs into a framework for environmental policy development i e the basis for political ecological economics the latter provides the most comprehensive and non utilitarian alternative to the main neoclassical approaches provided by arthur pigou and ronald coase kapp determined basic human needs to be necessary values operational for policymaking via politically derived and scientifically determined social minima criteria and socio ecological indicators this rational humanism was inspired by weber s concept of substantive rationality and informed by john dewey s pragmatic instrumentalism the paper concludes that kapp s contribution is important enough to cement its place in the broader school of ecological economics

resilience in the dynamics of economy environment systems the ecological concept of resilience has begun to inform analysis of change in economy environment systems the linkages between resilience and the stability of dynamical systems are discussed along with its role in understanding of the evolution of such systems particular linkages discussed include those between resilience biodiversity and the sustainability of alternative states recent developments in modelling the resilience of joint economy environment systems suggest the advantages of analysing change in the system as a markov process the transition probabilities between states offering a natural measure of the resilience of the system in such states it is argued that this emergent property of the collaboration between ecology and economics has far reaching implications for the way we think about model and manage the environmental sustainability of economic development

from great depression to great credit crisis similarities differences and lessons the great depression of the 1930s and the great credit crisis of the 2000s had similar causes but elicited strikingly different policy responses while it remains too early to assess the effectiveness of current policy it is possible to analyse monetary and fiscal responses in the 1930s as a natural experiment or counterfactual capable of shedding light on the impact of current policies we employ vector autoregressions instrumental variables and qualitative evidence for 27 countries in the period 1925 39 the results suggest that monetary and fiscal stimulus was effective that where it did not make a difference it was not tried they shed light on the debate over fiscal multipliers in episodes of financial crisis they are consistent with multipliers at the higher end of those estimated in the recent literature and with the argument that the impact of fiscal stimulus will be greater when banking systems are dysfunctional and monetary policy is constrained by the zero bound miguel almunia agustin benetrix barry eichengreen kevin h o rourke and gisela rua

towards a disequilibrium theory of endogenous economic growth this paper discusses the need for a new approach to economic growth theory the standard theory of growth in equilibrium driven by exogenous uncaused productivity gains has an implication that is both unjustified and perverse from a policy perspective that government intervention of any kind can only introduce constraints and reduce option space thus decreasing potential growth it is argued that growth theory should 1 acknowledge the importance of natural resources especially fossil fuels as a driver of past and present economic growth 2 incorporate an explicit recognition that growth is a consequence of technological innovation especially radical innovation that often responds to natural resource scarcities or other societal needs and 3 explicitly reflect the fact that the important i e scarce factors of production in economics can and do change over time i e from a rural cowboy economy of the past to an urbanized spaceship economy of the future in short it should reflect the fact that necessity is the mother of invention the first and third of these modifications have been proposed before but not in combination the third seems to be new

sustainability economics general versus specific and conceptual versus practical we clarify the definition and interpretation of sustainability economics baumgartner and quaas 2010 in response to recent comments by van den bergh 2010 bartelmus 2010 and others for that sake we distinguish between general and specific definitions of sustainability and sustainability economics as well as between conceptual and practical approaches

the coase theorem and the empty core a comment i would not presume to discuss the value of the theory of the core for economic analysis what i will do is to explain why study of the example which professors aivazian and callen use as the basis of their argument has not led me to modify my views the imagined situation which aivazian and callen analyse is one in which there is a laundry c and two firms a and b which pollute profits would be in total greater if the two polluters a and b closed down it is argued that in the conditions set out in their example c could not induce a and b to cease operations by means of money payments ifa and b were not liable for the harm inflicted on c it is assumed that if each firm operated independently firm a would earn profits of 3 000 per unit of time b 8 000 and c 24 000 however if a pair of these firms made an agreement to change their mode of operation the joint profits would be for a and b 15 000 for a and c 31 000 and for b and c 36 000 since the firm excluded from these agreements would continue to operate independently it is apparent by adding the profit earned by this firm to the joint profit of the two firms in the agreement that the combined profits of all three firms would always remain 39 000 however if a and b could be induced to close down so that c alone continued to operate c s profits would be 40 000 as total profits with two firms party to an agreement and one firm acting independently are always 39 000 and total profits would be 40 000 if c alone operated it would seem possible for c to make payments to a and b out of the additional 1 000 that would accrue which would make a and b better off than if they continued in operation and would still leave something over to increase c s profits aivazian and callen argue however that this would not happen they maintain given the conditions postulated in their example that even if an arrangement was made between a b and c which enabled profits of 40 000 to be earned that position would be unstable

reconciling sustainability systems theory and discounting abstract most definitions of sustainability imply that a system is to be maintained at a certain level held within certain limits into the indefinite future sustainability denies run away growth but it also avoids any decline or destruction this sustainability path is hard to reconcile with the renewal cycle that can be observed in many natural systems developing according to their intrinsic mechanisms and in social systems responding to internal and external pressures systems are parts of hierarchies where systems of higher levels are made up of subsystems from lower levels renewal in components is an important factor of adaptation and evolution if a system is sustained for too long it borrows from the sustainability of a supersystem and rests upon lack of sustainability in subsystems therefore by sustaining certain systems beyond their renewal cycle we decrease the sustainability of larger higher level systems for example schumpeter s theory of creative destruction posits that in a capitalist economy the collapse and renewal of firms and industries is necessary to sustain the vitality of the larger economic system however if the capitalist economic system relies on endless growth then sustaining it for too long will inevitably borrow from the sustainability of the global ecosystem this could prove catastrophic for humans and other species to reconcile sustainability with hierarchy theory we must decide which hierarchical level in a system we want to sustain indefinitely and accept that lower level subsystems must have shorter life spans in economic analysis inter temporal discount rates essentially tell us how long we should care about sustaining any given system economists distinguish between discount rates for individuals based on personal time preference lower discount rates for firms based on the opportunity cost of capital and even lower discount rates for society for issues affecting even higher level systems such as global climate change many economists question the suitability of discounting future values at all we argue that to reconcile sustainability with inter temporal discounting discount rates should be determined by the hierarchical level of the system being analyzed

lessons from the 1930s great depression this paper provides a survey of the great depression comprising both a narrative account and a detailed review of the empirical evidence focusing especially on the experience of the united states we examine the reasons for and flawed resolution of the american banking crisis as well as the conduct of fiscal and monetary policy we also consider the pivotal role of the gold standard in the international transmission of the slump and leaving gold as a route to recovery policy lessons for today from the great depression are discussed as are some implications for macroeconomics

clarifying the epistemology of corporate sustainability abstract business research is placing increasing focus on the relationship between the natural environment and the political concept of sustainable development within this nexus one area labelled corporate sustainability emphasizes the interactions between economic environmental and social values the need to consider multiple values has contributed to a blur in the conceptual landscape this is partly due to the fact that authors often address epistemological challenges on an implicit level moreover hidden ideologies e g the profit maximization paradigm can explain the conceptual obscurity the contribution of this article is twofold firstly a conceptual framework is developed based on the dichotomy of positivism and constructivism a relation is established between these epistemological positions and the analytic treatment of environmental and social values the framework can be applied to increase transparency on epistemological challenges and thereby strengthening construct validity in the field secondly an analysis of the most influential literature from the last 50 years shows that there is a trend of clustering theoretical positions and value constructs without any critical awareness of their philosophical assumptions the authors hope that acknowledgement of a multi paradigmatic approach can help to clarify the epistemology of the research area by establishing pluralism as an explicit position

the ideology of efficiency searching for a theory of policy analysis the potential pareto improvement criterion and other measures of economic efficiency do not pass the test of consistency and coherence within economic theory nor do such measures accord with what public decision makers seek in policy advice from economists such efficiency measures are nonetheless durable components of the ideology of economics in general and benefit cost analysis in particular the objectivity of the policy scientist has been confused with the objectivity of the science while economic efficiency has no claim to objectivity the policy scientist can be an objective analyst of policy choices

the case for methodological pluralism abstract ecology and economics share the same greek root both address complex systems ecology consists of numerous approaches to understanding natural systems energetics population biology food web models hierarchy theory to mention just a few within ecology field knowledge and the reporting of new observations are well respected economics on the other hand is dominated by one pattern of thinking and standard of proof the market model and econometrics within economics field knowledge and observations per se are little valued agreement on a correct method is frequently taken as an indication of the maturity of a science the argument is developed in this paper that all the aspects of complex systems can only be understood through multiple methodologies the agreement on method within economics however seems to reflect stronger pressures within the discipline for conformity than for truth relative to ecology since ecological economics seeks to understand a larger system than either economics or ecology seeks to understand a diversity of methodologies is appropriate and pressures to eliminate methodologies for the sake of conformity should be avoided

golden fetters the gold standard and the great depression barry eichengreen oxford university press new york 1992 pp xix 448 39 95

new foundations for ecological economics abstract ecological economics has been repeatedly described as transdiciplinary and open to including everything from positivism to relativism i argue for a revision and rejection of this position in favour of realism and reasoned critique looking into the ontological presuppositions and considering an epistemology appropriate for ecological economics to meaningfully exist requires rejecting the form of methodological pluralism which has been advocated since the start of this journal this means being clear about the differences in our worldview or paradigm from others and being aware of the substantive failures of orthodox economics in addressing reality this paper argues for a fundamental review of the basis upon which ecological economics has been founded and in so doing seeks improved clarity as to the competing and complementary epistemologies and methodologies in part this requires establishing serious interdisciplinary research to replace superficial transdisciplinary rhetoric the argument places the future of ecological economics firmly amongst heterodox economic schools of thought and in ideological opposition to those supporting the existing institutional structures perpetuating a false reality of the world s social environmental and economic systems and their operation

the value of biodiversity markets society and ecosystems the value of biodiversity is discussed at different levels including market value non market values to humans and the value of biodi versity to ecosystems the main conclusion is that although market exchange values of environmental services may be used to justify biodiversity protec tion measures it must be stressed that exchange value constitutes a small portion of total biodiver sity value the total value of existing biodiversity is largely unknown but indications are that it is essen tial to human existence the various levels of biodi versity value point to the need for a hierarchical and pluralistic methodology to determine appropri ate policies for its preservation jel q21 i introduction among ecologists there is a general con sensus that biodiversity1 is of critical impor tance to the health of ecosystems and even for the long term survival of the human species there is also a consensus that bio diversity is being lost at a rate which is a cause for concern 2 economists on the other hand generally view biodiversity as just an other good which is to be placed in the basket of market choices just as any other the discussion of the specifics of biodiver sity policy has been unsatisfactory partly because of the different meanings of the word value used by economists and ecolo gists many ecologists fail to understand the logic of market allocation and why biologi cal resources are used in seemingly irra tional ways many economists fail to ap preciate the narrowness of the concept of economic value as indicated by relative prices determined by market exchange fol lowing anderson 1966 and brown 1984 the discussion below considers economic measures of value to be species of the genus assigned value which belongs to the family value many biologists and paleontologists be lieve that we are at a critical point in the history of the human species and perhaps even in the 600 million year history of com plex multicelled life on earth if the paleon tologists and biologists who study the phe nomenon of mass extinction are correct the current human induced mass extinction may be of the same order of magnitude as the five other major extinction episodes which destroyed between 20 and 96 percent of existing species on the planet ehrlich and ehrlich 1992 ward 1994 wilson 1992 we are living in a truly remarkable period in earth s 41 billion year history the valua tion decisions our species has made in the recent past and will make during the next few decades will determine the fate of life on earth for the next tens of millions of years it is critical to clarify the language and concepts we use to estimate the value of biodiversity and thus policies leading to its destruction or preservation the importance attached to the issue of biodiversity preservation necessarily in volves ethical judgments about duty to fu ture generations and responsibility toward the nonhuman natural world although in dividuals hold a variety of conflicting beliefs about human responsibility to the natural world this does not mean that policy choices

allocation distribution and scale towards an economics that is efficient just and sustainable abstract the practical policy of issuing tradeable permits for depletion and pollution requires for its implementation the clear separation of the three basic economic goals of efficient allocation equitable distribution and sustainable scale economic theory needs to catch up with policy in recognizing that scale issues cannot be reduced to either allocation or distribution

towards an ecological economics of sustainability abstract persistent disagreement both as to the interpretation to be given to sustainability and as to the relation between ecological and economic sustainability has hindered the development of an ecological economics of sustainable resource use this paper identifies the main concepts of sustainability deriving from the two disciplines in order to explore the difference implied by an ecological approach to the problem it is argued that present economic and ecological approaches are largely disjoint and that they address basically different phenomena by combining the efficiency requirements of what is usually thought of as economic sustainability with the stability requirements of an ecological approach it is shown that an intertemporally efficient allocation of resources that satisfies the conditions for constant levels of consumption is not necessary to assure ecological sustainability ecological sustainability requires that the allocation of economic resources should not result in the instability of the economy environment system as a whole

the approach of ecological economics this paper discusses the major tenets of ecological economics including value pluralism methodological pluralism and multi criteria policy assessment ecological economics offers viable alternatives to the theoretical foundations and policy recommendations of neoclassical welfare economics a revolution in neoclassical economics is currently taking place and the core assumptions of welfare economics are being replaced with more realistic models of consumer and firm behaviour this paper argues that these new theoretical and empirical findings are largely ignored in applied work and policy applications in environmental economics as the only heterodox school of economics focusing on the human economy both as a social system and as one imbedded in the biophysical universe and thus both holistic and scientifically based ecological economics is poised to play a leading role in recasting the scope and method of economic science

rio 20 looking back at 20 years of environmental and resource economics twenty years on from the rio 92 conference we must face the fact that there have been a few successes but more failures scientific complexity uncertainty short termism inherent in politics the free rider problem and issues of fairness are part of the explanation for the lack of progress but we point to more fundamental motivational problems it is time to assess our responsibility as economists in the field of environment and resources our scientific contribution has been misleading because our models are structurally incapable of addressing major concerns the cost benefit test is not fit to assess large scale resource conservation projects including climate abatement this understanding was already present during the rio 92 summit but the problems while identified have not been resolved twenty years later the contribution from theory through the sustainability paradigm of non decreasing welfare has turned out ineffective it does not provide us with tools for designing a better future for our children instead it risks choosing a constant welfare path with knowledge increasing but natural resources deteriorating while not properly analyzing the richer possibilities for a better future that nature and creativity imply it is time for our profession to search for a more constructive contribution in theory and practice

monetary valuation of ecosystem services it matters to get the timeline right in the abundant literature dealing with the monetary valuation or monetization of ecosystem services mes with very few exceptions the concept is presented as having emerged in 1997 in fact there is a long history starting in the late fifties but largely ignored of sustained attempts to assign monetary values to nature s services these early efforts encountered many conceptual and methodological roadblocks which could not be resolved and led a number of researchers to argue that monetary valuation was not a fruitful approach it is in that context that mes was hailed by some in 1997 as a promising way to integrate environmental goods and services into the logic of economic markets knowledge of the full timeline casts a very different light in particular on the difficulties currently encountered in the practice of mes far from being the expected growing pains of a young discipline these difficulties turn out to be long standing problems that have eluded solution over the last half century and appear intrinsically unresolvable this perspective suggests that at this point it is advisable to look at alternatives to mes for the integration of nature into economic decisions

institutional ecological economics abstract new institutional economics and its forerunners have we argue made important contributions to the evolving agenda of ecological economics the conceptualisation of environmental problems as instances of interdependence and the acknowledgement of positive transaction costs are key insights into the nature of environmental problems we also discuss how plurality of behavioural motivations and limited cognitive capacity have important implications for environmental decision making and its analysis we show how evolutionary and collective action theories offer complementary takes on the choice and change of environmental governance institutions and how the concept of social capital can enrich analyses of environmental governance we conclude that an emerging institutional ecological economics has the greatest relative advantage in analysing the design implementation and effectiveness of environmental governance solutions

us monetary and fiscal policy in the 1930s the paper provides a survey of fiscal and monetary policies during the 1930s under the hoover and roosevelt administrations and how they influenced the policies during the recent great recession the discussion of the causal impacts of monetary policy focuses on papers written in the last decade and the findings of scholars using dynamic structural general equilibrium modelling the discussion of fiscal policy shows why economists do not see the new deal as a keynesian stimulus describes the significant shift toward excise taxation during the 1930s and surveys estimates of the impact of federal spending on local economies the paper concludes with discussion of the lessons for the present from 1930s monetary and fiscal policy

british monetary and fiscal policy in the 1930s current economic turbulence has revived interest in interwar macroeconomic instability and policy this paper provides a guide to the current state of knowledge on british macroeconomic policy between 1929 and the eve of the second world war for today s economists and policy makers mindful that some will seek lessons from this earlier age it makes clear the very particular economic and policy context of the time including the marked difference between british and american economic performance and policies and the challenge posed by the massive rise in debt brought about by the first world war knowledge transfer is possible here for policy learning but what transpires is that lessons are typically stronger as negatives than as positives namely what should not be done in general as against what might be done this largely situation specific the focus is the role and effectiveness of the monetary and fiscal policies pursued together with an assessment of the principal policy not adopted namely the keynesian solution of significant loan financed public works to remedy mass unemployment the analysis is comparative with respect to us macroeconomic economic performance and policy it explores the different macroeconomic shocks of the contraction phase the term great depression is not really appropriate to the british experience in the two countries comparative policy regimes and then in turn analyses the policy mix and policy effectiveness of monetary and fiscal policy including for britain the counterfactual keynesian solution a business cycle periodization is adopted with the key role for the abandonment of the gold standard in terms of regaining freedom of choice in macroeconomic policy itself experiencing significant developments after 1931 the traditional role of the cheap money induced housing boom in britain s post 1932 economic recovery is reaffirmed the impact of the fiscal policies actually pursued are then discussed as are assessments of the likely effectiveness of the keynesian solution had the 1929 liberal party s we can conquer unemployment spending package been implemented

finding common ground between ecological economics and post keynesian economics abstract post keynesian economics and ecological economics have in common that they are considered to be heterodox schools of thought aside from that there has not been a strong connection between them previous books on post keynesian economics contain no chapter on environmental or ecological issues this neglect has led leading ecological economists to criticize post keynesians for succumbing to the same growth paradigm as the neoclassical school this paper argues that the two approaches are complementary in the sense that they each have different strong points ecological economics has correctly pointed out that the growth of the global economy may not be welfare improving anymore whereas post keynesians have gained valuable insights into the functioning of the capitalist growth process to determine the feasibility of a synthesis between the two schools the paper compares their approaches to the problems of production consumption and economic dynamics as well as the associated policy recommendations it shows that on a theoretical level the two schools have much in common but their policy conclusions differ with regard to the desirability of further growth the paper concludes that a synthesis of both approaches may lead to a better understanding of how a capitalist economy operates in a natural environment with limits to growth and to better informed policy advice

macroeconomic policy in light of the credit crunch the return of counter cyclical fiscal policy this paper begins by arguing that the 2007 8 credit crunch does not require a fundamental reevaluation of monetary policy the crunch occurred because regulation was too lax and we need to develop new and more effective tools of regulatory control to focus on current account imbalances or mistakes in setting interest rates as a prime cause of the credit crunch is unconvincing and has the danger of diverting attention away from the need to increase financial regulation the current recession does require a re evaluation of the role fiscal policy can play when interest rates hit a zero bound an expansionary fiscal policy is required because monetary policy makers are reluctant to promise higher future inflation and the impact of quantitative easing is likely to be small although rising debt may place a limit on how much conventional fiscal policy can do not all expansionary fiscal measures require additional borrowing there are two important lessons for the future first although monetary policy should remain the primary tool to stabilize the business cycle the combination of fiscal implementation lags and uncertainty means that some precautionary fiscal action may be appropriate during the early phase of some economic downturns second to play this backstop stabilization role effectively a policy that results in the government debt to gdp ratio declining albeit gradually and erratically in normal times seems appropriate

the great crash and the onset of the great depression this paper argues that the collapse of stock prices in october 1929 generated temporary uncertainty about future income which led consumers to forgo purchases of durable goods that the great crash generated uncertainty is evidenced by the decline in surety expressed by contemporary forecasters that this uncertainty affected consumer behavior is shown by the fact that spending on consumer durables declined drastically in late 1929 while spending on perishable goods rose slightly this effect is confirmed by the fact that there is a significant negative relationship between stock market variability and the production of consumer durables in the prewar era

taxation portfolio choice and debt equity ratios a general equilibrium model this paper explores the portfolio behavior of investors differing with respect to both tax rates and risk aversion emphasizing the role of constraints on individual and firm behavior in ensuring the existence of and characterizing portfolio equilibrium under certain conditions on the securities available in the market which also are necessary for shareholders to be unanimous in supporting firm value maximization investors will be segmented by tax rate into two groups one specialized in equity and the other in debt though the relative wealths of the two groups determine the aggregate debt equity ratio each firm will be indifferent to its financial policy

recent evolutionary theorizing about economic change this famous passage from marshall s principles of economics it first appeared in the fifth edition which came out in 1907 nicely brings out two issues which are as germane to economics today as they were when marshall wrote the first is the heavy reliance by economists in their formal theorizing on the notion of equilibrium the other is the appeal that biological conceptions3x201d have for many economists particularly when their focus is on economic change

mm past present future one of the most productive days in my life was the day in 1956 when it was agreed that merton miller then a shy and retiring young man would you believe it would sit in my graduate course in money and macroeconomics at carnegie institute of technology it was an exciting course with excellent students it took a broad view of the subject one issue that was covered was the cost of capital as a determinant of the rate of investment i had been intrigued by the subject ever since attending a national bureau conference on business finance at which i gave a fairly conventional paper modigliani and ziman 1952 but mostly i listened to a paper by david durand 1952 in which the possibility that financial structure would not affect the market valuation or the cost of capital was suggested only to be rejected as not relevant to the actual capital markets in preparing my lecture dealing with the cost of capital i was able to provide for a world of no taxes a sort of proof of proposition i based on arbitrage i reported the result to my class the next day adding that i didn t really believe my result and there probably was something wrong but miller was instantly captured by the result because he said he knew of a recent paper allen 1954 which provided empirical support for the result even though it lacked a convincing rationale we thus formed

towards a new complexity economics for sustainability some of the most important and urgent topics requiring economic analysis and policy advice are the problems of climate change and environmental sustainability and what can be done to alter corporate and individual behaviour to deal with these issues neoclassical economists tend to focus on market solutions such as carbon trading drawing on ideas of perfect rationality of actors and the appropriateness of marginal analysis to link such policies to the whole range of potential actions from legislative and regulatory to changing individual behaviours requires the economy and society to be analysed in its full complexity recognising that marginal analysis can be not just irrelevant but positively harmful when the need is for systemic shifts in economic and social trajectories this article draws upon a seminar series on complexity economics to consider how heterodox economic analysis can be brought to bear on the issue of the environment to develop a realistic policy agenda for change copyright oxford university press

structured pluralism in ecological economics a reply to peter soderbaum s commentary abstract peter soderbaum argues in his commentary concerning my article on sustainability economics remig 2015 for more open and radical ecological economics i agree with that statement however i reject soderbaum s interpretation that my arguments foster mainstreamed ecological economics or dictatorship in my critique of sustainability economics i raised several issues that have remained unspecified and that potentially lead to unsustainable development patterns once put into practice soderbaum does not reply to these conceptual challenges of sustainability economics in this commentary i argue that structured pluralism dow 2004 is a constituent element of ecological economics i welcome peter soderbaum s proposal for a discussion about the definition of economics and suggest to rely on ronald coase s proposal to define economics as a science that studies the working of the economic system i conclude that sustainability economics in its current form is closer to neoclassical than ecological economics

economic schools of thought on the environment investigating unity and division how do ecological and heterodox economists differ if at all from each other and from neoclassical economists addressing environmental problems in 2009 we probed this question by conducting an international survey across these communities namely at conferences of the european society for ecological economics the association for heterodox economics and the european association of environmental and resource economists the research was designed to gain insight into the extent to which ecological economics can be described as heterodox and a distinct field from orthodox environmental and resource economics conflicting visions of ecological economics have led to a prevalence of neoclassical articles and thought mixed in amongst more heterodox work we introduce a novel classification of work in the field of environmental policy in order to test for the existence of differences in terms of methodological and ideological approaches how heterodox economists understand environmental issues is also an important question to answer if there is to be more collaboration between them and ecological economists the findings have implications for cooperation and the future direction of both ecological and heterodox economics

varieties of ecological economics do we need a more open and radical version of ecological economics abstract should we aim at one single economics paradigm for all purposes or is it wise to accept the existence of more than one theoretical perspective is one ecological economics perspective enough or should we encourage competing paradigms as part of a pluralist perspective moritz remig expresses his preference for mainstreaming ecological economics in the january 2015 issue of ecological economics suggesting that alternative perspectives and alternative terminologies such as sustainability economics lead to confusion in this reply i am arguing that there is no value free or value neutral ecological economics and that therefore limiting economics or ecological economics to one paradigm is not compatible with democracy we have to live with some complexity when dealing with sustainability issues and should not avoid issues of paradigm ideology and political economic system

the identity of ecological economics retrospects and prospects the paper first reveals the relevance of ecological economics in the time of a triple crisis ecological social and economic and promotes it as a distinct paradigm comprised of two interconnected and interdependent aspects the qualitative framework within which it operates and the quantitative models and techniques it uses to observe ecosystem resilience measure progress towards sustainability and evaluate policies while acknowledging the progress that has so far been made the paper argues that divergences in understanding the meaning and content of ecological economics hinder its effectiveness and influence on real world policy making and calls for a unified framework as a common ground that would strengthen the field and direct research the implication of this position then follows pointing out what has so far been missing from the ecological economics analysis and what should be done for it to become a more problem oriented and policy relevant alternative copyright oxford university press

unraveling the veil of fuzziness a thick description of sustainability economics this article provides a thick description geertz 1973 of sustainability economics baumgartner and quaas 2010a b have proposed as an alternative to ecological economics the new field of sustainability economics which has triggered various replies the purpose here is to order and to review these contributions building upon a literature review of sustainability economics the paper argues that the concept currently has more of a fuzzy and declamatory character the rhetoric mccloskey 1998 of sustainability economics contains general issues of sustainability economics externalities and the capability approach the article argues that it is currently not clear how the solutions for science and policy proposed by sustainability economics differ from those of ecological economics efforts should be directed towards further development of the theory and the operationalization of sustainability principles the systemic view of co evolutionary development social learning and sustainability economics normative underpinning merits more consideration in the debate about sustainability economics

what is ecological economics ecological economics addresses the relationships between ecosystems and economic systems in the broadest sense these relationships are the locus of many of our most pressing current problems i e sustainability acid rain global warming species extinction wealth distribution but they are not well covered by any existing discipline environmental and resource economics as it is currently practiced covers only the application of neoclassical economics to environmental and resource problems ecology as it is cur rently practiced sometimes deals with human impacts on ecosystems but the more common tendency is to stick to natural systems ecological economics aims to extend these modest areas of overlap it will include neoclassical environmental economics and ecological impact studies as sub sets but will also encourage new ways of thinking about the linkages between ecological and economic systems we have chosen the name ecological economics for this area of study because it implies a broad ecological interdisciplinary and holistic view of the problem of studying and managing our world the earth from space cover of the journal reflects this global holistic perspective we did not intend to imply with the ordering of the two words in the title that the journal is mainly an economics journal it is intended to be a new approach to both ecology and economics that recognizes the need to make economics more cognizant of ecological impacts and dependencies the need to make ecology more sensitive to economic forces incentives and constraints and the need to treat integrated economic ecologic systems with a common but diverse set of conceptual and analytical tools there was much discussion of other possible names such as economic ecology or ecology and economics or some conjoining of the two words that to me end up being confusing tongue twisters like ecolnomics or econology but ecological economics seemed to get closest to the mean ing we desired while still being evocative to the uninitiated