does economic recession reduce material use empirical evidence based on 157 economies worldwide abstract the research on economic recession has been more focused on the interactions between macroeconomic and financial variables however whether material use has been affected during the recession period has remained under explored in order to fill up this gap this study investigates the relationship between material use and economic recession as well as other socio economic drivers by using the material flow analysis and the system generalized method of moments for 157 economies worldwide during 1980 2011 results show that economic recession poses significant and negative impact on domestic material consumption at 1 level illustrating its role as a determinant factor on material mitigation by dividing the research sample into extractive and non extractive economies as well as high mid and low income groups we again confirmed the significant negative correlations as expected no significant sign is found between recession and physical trade balance besides other drivers such as population gross domestic production gdp per capita and technological variables also exert marked effects at different situations this research work provides an empirical study on how recession and other factors affect material use at various scenarios which have essential implications for understanding material flow dynamics in different economic cycles

co benefit of carbon mitigation on resource use in china abstract on one hand natural resources and energy provide the basis for life on earth but waste and emissions are produced during their throughput on the other hand china as the most populous country and an emerging economic powerhouse has taken on the challenge of hitting peak carbon dioxide co2 emissions by 2030 pursuing resource co benefits from carbon mitigation is an effective approach for china on the road to achieving the 2030 goal in this study we combine the computable general equilibrium cge model and the economy wide material flow accounts or analysis ew mfa method to estimate china s future co2 emissions and resource consumption and their co benefit effect three scenarios are analyzed business as usual bau nationally determined contributions ndc and the scenario of achieving the 2 degree target 2deg we find that both the ndc and 2deg targets can be achieved by 2030 without a significant compromise in economic growth with the effect of carbon mitigation china s resource consumption would rise by a factor of 1 7 bau 1 6 ndc and 1 5 2deg during 2012 2030 and the reduction in co benefits of metal ores nonmetallic minerals and fossil fuels would be 0 6 billion tons and 1 4 billion tons 0 8 billion tons and 2 0 billion tons and 2 6 billion tons and 4 6 billion tons for ndc and 2deg respectively sectoral disparity indicates that sectors with high emissions and resource consumption include traditional heavy industrial sectors and energy related sectors for which additional mitigation policies should be employed not only because they offer the most co benefit effects but they also have the least cost

does the bond market predict bankruptcy settlements this study shows the extent to which deviations from the absolute priority rule increase or decrease the bankruptcy emergence payoff to traded i e usually junior claimants bondholders the data indicate that on average bondholders benefit albeit slightly from absolute priority rule apr violations this paper also examines the degree to which the bond market in the bankruptcy filing month anticipates departures from the apr and other influences on the payoff to bondholders in other words we investigate the informational efficiency of the market for bankrupt bonds overall despite the complex and lengthy nature of bankruptcy proceedings the results support efficiency the finance literature has traditionally assumed that when a firm enters bankruptcy the creditors become the owners and the value of the firm is distributed according to the absolute priority rule apr the apr states that senior creditors should be fully compensated before junior creditors receive any portion of the bankrupt firm s value and junior creditors should receive full payment before shareholders receive any compensation in practice formal bankruptcy proceedings are complex processes that often violate the apr brown 1989 captures some of the intricacies of this process in a game theoretic model showing that the solution to the bargaining process in bankruptcy can involve deviations from the apr although the solution

international trade and energy intensity during european industrialization 1870 1935 the study was conducted in the research project who did the dirty work energy embodied in european and global trade 1800 1970 funded by the swedish research council 421 2013 1110 vetenskapsradet

fair trade towards an economics of virtue over the past 10 years the sales of fair trade goods particularly those carrying the fair trade labelling organizations international flo certification mark have grown exponentially academic interest in fair trade has also grown significantly over the past decade with researchers analysing the model from a wide range of theoretical perspectives whilst fair trade is generally acknowledged as a new supply chain model it has tended to be studied at the micro organisational level rather than at the macro systems level as a consequence its wider impact as institutional innovation at the field level appears to have been under theorised so far in order to address this research gap this article uses a neo institutionalist perspective to analyse fair trade not simply as a new exchange model working within existing organisational and economic structures but rather as an agent of institutional entrepreneurship at and beyond the field level from this latter perspective fair trade brings a new set of transformational meanings to extant exchange and consumption models and reforms fields of economic exchange by disrupting and then re assembling key institutional elements around modern consumption to roll back commodity fetishism and reconnect consumers and producers the type of institutional change driven by fair trade can be seen as a form of social entrepreneurship

drivers for the use of materials across countries abstract this paper analyses drivers for resource use and material productivity across countries this is not only relevant in light of soaring raw material prices but also because eu policies such as the thematic strategy on the sustainable use of natural resources com 2005 670 the eu raw materials initiative com 2008 699 and various similar policies internationally seek to better manage materials along their life cycle and across economies in order to better understand the system dynamics of material use our paper applies methodologies of material flow analysis and regression analysis to identify the major drivers for resource use and decoupling from gdp drivers are understood as those factors that exert influence on human activities to use resources a panel data set is taken for the european union for the years 1980 2000 eu 15 and 1992 2000 eu 25 the main drivers of resource use were found to be energy efficiency new dwellings and roads construction activities shortcomings of the methodology are also discussed

is the japanese economy in a liquidity trap abstract a random coefficient estimation procedure is used to estimate the time profile of the interest rate elasticity of japanese money demand contrary to the prediction of the liquidity trap hypothesis the absolute value of the elasticity is found to decline at lower levels of interest rates

green goals and full employment are they compatible abstract two empirical correlations are studied one between economic growth and environmental impacts and the other between the lack of economic growth and unemployment it is demonstrated that at a global level economic growth is strongly correlated with environmental impacts and barriers to fast decoupling are large and numerous on the other hand low or negative growth is highly correlated with increasing unemployment in most market economies and strategies to change this lead to difficult questions and tradeoffs the coexistence of these two correlations which have rarely been studied together in the literature on green growth degrowth and a growth justifies ambivalence about growth to make key environmental goals compatible with full employment the decoupling of environmental impacts from economic output has to be accompanied by a reduction of dependence on growth in particular strategies to tackle unemployment without the need for growth several of which are studied in this article need much more attention in research and policy

theoretical analysis regarding a zero lower bound on nominal interest rates this paper explores several issues concerning a possible zero lower bound zlb including its theoretical rationale the magnitude of effects of low sustained inflation on real interest rates the validity of analyzing monetary policy in models with no monetary variables and the dynamic stabilizing properties of taylor rules in a zlb context the most important argument however is that if the short nominal rate is immobilized at zero there nevertheless exists a route for monetary stabilization policy to be effective via the foreign exchange market its quantitative importance is examined in a calibrated optimizing open economy model

100 percent reserve banking a critical review of green perspectives abstract 100 percent reserve banking c perb is an enduring proposal for monetary reform that has been taken up by some ecological economists this paper identifies three groups of green arguments in favor of c perb and offers some criticism first the proposal could serve to constrain new investments by the availability of savings thereby checking economic growth however this would strongly increase interest rate volatility second it could potentially elevate environmental considerations in decisions about resource allocation by increasing the role of the democratic state as an economic actor this line of argument faces problems that require further detailed exploration and historical perspective third a transition to c perb would allow debt levels to be drastically cut this is technically possible but politically a tall order whether the existing system of debt based bank money generates a significant growth imperative is unclear and the importance of other driving forces behind perennial economic growth in modern societies which c perb does not address remains an issue of contention in general the adoption of c perb presupposes a tremendous reconfiguration of power relations between states and finance capital

for love or money fairtrade business models in the uk supermarket sector sales in supermarkets have contributed greatly to growth in fairtrade but the literature suggests there may be tensions between fairtrade principles and the commercial practices which characterise uk supermarket value chains this article explores these tensions through an analysis of supermarket value chains for fairtrade coffee cocoa bananas and fresh fruit it finds considerable variation in uk supermarket approaches in terms of scale and scope of commitment to fairtrade and in the nature of relationships with fairtrade suppliers in some cases supermarket involvement has the potential both to expand and deepen the impact of fairtrade whereas in others it threatens to undermine the ability of fairtrade to support long term processes of development the findings indicate that a more nuanced approach to supermarket fairtrade is required with recommendations for actions that could be taken to maximise the opportunities and minimise the risks

material use and material efficiency in latin america and the caribbean different world regions have followed very different trajectories for natural resources use over the recent decades latin america has pursued a development path based largely on exports of primary resources adopting this path has characteristic environmental and social impacts in this paper we provide the first broad based estimate of material use and material efficiency for the region beginning in 1970 and extending to the onset of the global financial crisis in 2008 the results show a region with rapidly growing primary materials consumption which is simultaneously becoming less efficient at converting those resources into national income using an ipat framework we found that population growth and rising per capita incomes made comparable contributions to growing material use while technological change as reflected in material intensity did not moderate consumption increasing materials intensity observed for the region as a whole is also observed for most individual countries this contrasts with some other world regions and implies that many countries in latin america and the caribbean will confront higher environmental pressures than expected when expanding their extractive industries to take advantage of new demand from other world regions while simultaneously supplying the requirements for their own domestic industrial transformations and urbanization

analysis on major drivers of cement consumption during the urbanization process in china abstract accompanying by the rapid urbanization process of china unprecedented amounts of cement have been poured into urban construction over the last decade since research is still scarce on the factors underlying the cement consumption the motivation of this paper is to provide insight into cement based socioeconomic metabolism and to improve understanding of the linkage between human activities and cement consumption to explore the key impact factors of cement consumption an extended stirpat model is exploited in this paper to examine the effect of population gross domestic product gdp per capita cement consumption intensity fixed investment and urbanization level with regional panel data of china from 2005 to 2013 the empirical results indicate that fixed investment and gdp per capita are the decisive driving factors of cement consumption the unbalanced investment between infrastructure and people s livelihood reflects bias urbanization policy in china inverted u shaped nexus between cement consumption and urbanization as well as gdp per capita are observed in the empirical results moreover regional heterogeneities are taken into account in the model estimation on the ground of the empirical findings several policy recommendations are provided for policy makers it is suggested that policy makers should take account of the regional discrepancy and implement a sustainable urbanization strategy to curtail cement consumption only when excessive fixed investment is curbed does the enthusiasm of cement consumption calm down

monetary policy when interest rates are bounded at zero this paper assesses the importance of the zero lower bound on nominal interest rates for the interest rate channel of monetary policy we simulate several interest rate setting policy rules with ei

long term changes in social metabolism and land use in czechoslovakia 1830 2000 an energy transition under changing political regimes abstract industrialisation goes along with sweeping changes in society s interrelations with its environment the transition from an agrarian to an industrial society leads to fundamentally new patterns in social metabolism a process which has been described as socio metabolic transition this paper investigates this transition for the case of the current czech and slovak republics and presents a dataset on the development of key variables related to social metabolism during the last 170 years the dataset includes time series data on the extraction of biomass and fossil fuels energy consumption and land use combining data on bohemia and moravia 1830 1915 with data on czechoslovakia 1918 1992 and the czech and slovak republics 1993 2002 the study covers a period of consecutive political and institutional changes it includes the feudal regime of the late period of the habsburg empire and its disintegration with wwi the short period of the czechoslovak republic in the interwar period the era of a planned economy under a communist regime the collapse of this regime and the subsequent turn towards a market economy and european integration in the 1990s the period was characterized by economic and physical growth it saw a doubling of population and a growth in gdp by a factor 20 domestic energy consumption dec increased by a factor 10 and the share of biomass in dec declined from more than 98 to less than 20 all in all the observed changes closely resemble the characteristic path of the socio metabolic transition as observed in other western european economies major political and economic changes did not result in fundamental alterations of the socio metabolic transition until the mid 20th century the communist era 1945 1989 was characterized by rapid physical growth and changes in the energy and land use system very similar to those of other western european economies in the same period however leading to dec values substantially higher than those of other european countries at around 300 gj cap in the mid 1980s the disturbances caused by the velvet revolution resulted in short term turbulences in social metabolism and structural adaptations and around the year 2000 the czech and slovak republics show biophysical features very similar to those of other western european countries

renovatio monetae when gesell taxes worked gesell taxes on money have recently received attention as a way of alleviating the zero lower bound on interest rates less known is that such taxes generated seigniorage in medieval europe for around two centuries when a gesell tax was levied current coins ceased to be legal and had to be exchanged into new coins for a fee using a cash in advance model we analyze under what conditions agents exchange coins and the tax generates revenues a low exchange fee high punishments for using old coins and a long time period between re mintings induce people to use new coins

towards a framework for understanding fairtrade purchase intention in the mainstream environment of supermarkets despite growing interest in ethical consumer behaviour research ambiguity remains regarding what motivates consumers to purchase ethical products while researchers largely attribute the growth of ethical consumerism to an increase in ethical consumer concerns and motivations widened distribution mainstreaming of ethical products such as fairtrade questions these assumptions a model that integrates both individual and societal values into the theory of planned behaviour is presented and empirically tested to challenge the assumption that ethical consumption is driven by ethical considerations alone using data sourced from fairtrade shoppers across the uk structural equation modelling suggests that fairtrade purchase intention is driven by both societal and self interest values this dual value pathway helps address conceptual limitations inherent in the underlying assumptions of existing ethical purchasing behaviour models and helps advance understanding of consumers motivation to purchase ethical products

why people don t take their concerns about fair trade to the supermarket the role of neutralisation this article explores how neutralisation can explain people s lack of commitment to buying fair trade ft products even when they identify ft as an ethical concern it examines the theoretical tenets of neutralisation theory and critically assesses its applicability to the purchase of ft products exploratory research provides illustrative examples of neutralisation techniques being used in the ft consumer context a conceptual framework and research propositions delineate the role of neutralisation in explaining the attitude behaviour discrepancies evident in relation to consumers ft purchase behaviour providing direction for further research that will generate new knowledge of consumers ft purchase behaviour and other aspects of ethical consumer behaviour

focus on fairtrade propositions for integrating fairtrade and supply chain management research driven by increased consumer interest and stakeholder pressure the number of fairtrade ft products has been steadily increasing the mainstreaming of ft means that the products are now facing stiff competition within the generic product categories in which they operate while consumers may pressure organizations for ethical conduct they are less willing to pay premium prices for fairly traded products for ft to continue to grow more efficient operating models are required to offset the premium prices paid to producers to ensure competitiveness in the market one such improvement approach may be the management of ft supply chains to investigate the feasibility of this approach this article systematically combines literature on ft with key supply chain management scm constructs and theories we discuss existing scm paradigms in the context of ft and demonstrate aspects where the efficiency of ft chains needs to be improved to ensure their viability we present propositions that demonstrate the key limitations of the ft model from the point of view of scm theory and practice and suggest the potential changes needed in the management of ft supply chains the article provides a timely first attempt to systematically combine ft with scm constructs thus establishing a basis for the further development of ft chains and for the improvement of the operating efficiency within them

through thick and thin how fair trade consumers have reacted to the global economic recession research on fair trade has flourished over the past decade as fair trade food products have gained popularity amongst consumers in many developed economies this study examines the effects of recessionary economic conditions on fair trade consumers purchasing behaviour an online survey was administered to 306 fair trade consumers from canada the united kingdom and the united states of america the results reveal a discrepancy among fair trade consumers as only consumers that purchase fair trade on an occasional basis adhered to established consumer behaviour norms i e decreasing their purchases of fair trade products and becoming significantly more price aware respondents who actively consume fair trade generally remained loyal to their purchase while some active consumers altered their purchasing behaviour this phenomenon was not common amongst this group as no statistically significant changes were observed differences were also noted among the three countries as the canadian and us fair trade consumers significantly decreased their consumption of fair trade as a result of the recession whereas the uk consumers did not in addition to the research results theoretical and managerial implications will be discussed along with future research directions

an empirical investigation of u s firms in reorganization the purpose of this paper is to understand the institutional features of chapter 11 from an empirical examination of thirty firms that have emerged from reorganization we find the recontracting framework of chapter 11 to be complex lengthy and costly violations of absolute priority in favor of stockholders are frequently encountered these deviations may result from the bargaining process of chapter 11 or from a recontracting process between creditors and stockholders which recognizes the ability of stockholder oriented management to preserve firm value an example of such recontracting addresses myers underinvestment problem an investigation of the effects of chapter 11 on the pricing of risky debt is also provided the purpose of this paper is to understand the institutional features of chapter

pathways to a resource efficient and low carbon europe abstract various environmental footprint concepts have already been developed and applied in sustainability research however these analyses tend to remain restricted to historical observation samples at least in comparison with related research activities in other environmental policy domains like e g climate policy it seems that applications of integrated assessment tools represent rather seldom exceptions within the resource policy domain our paper is therefore intended to strengthen the related evidence base we present recent projections from the dynamic multi region input output mrio simulation model ginfors global inter industry forecasting system which provide an outlook on global development trends until the year 2050 our detailed material footprint and climate policy assessment indicates that a global agreement on a policy mix will allow a clear turnaround towards climate protection and a sustainable use of natural resources without deteriorating economic performance if the eu decides unilaterally to lead the way then this turnaround could also be achieved for the eu while the eu would also benefit economically from this pioneering role a third pathway towards a resource efficient and low carbon europe quantifies the environmental and economic impacts of a strong transitional change induced by european citizens commitments to far reaching sufficiency objectives

not only subterranean forests wood consumption and economic development in britain 1850 1938 abstract this paper analyzes wood consumption in britain over the period 1850 1938 we calculate the apparent consumption of wood taking into account both net imports of wood and the home harvest we then develop some quantitative exercises that correlate wood consumption with gdp with prices of wood and iron as an alternative material to wood and with other measures the main conclusion is that although wood had lost its economic centrality after the energy transition wood consumption continued to grow in britain both in absolute and relative terms showing a positive elasticity to gdp superior to the unit this result allows us to reach a more complete understanding of the socio metabolic transition associated with the industrial revolution britain faced the increase in wood demand by relying almost entirely on imported wood reinforcing the idea that the decoupling of economic growth from land use must to be handled with care and should be observed not at the national level but on a global scale although british economic development was to a great extent focussed on what has been called the subterranean forests of coal it simultaneously supported large tracts of surface foreign forest

the fair trade movement parameters issues and future research although fair trade has been in existence for more than 40 years discussion in the business and business ethics literature of this unique trading and campaigning movement between southern producers and northern buyers and consumers has been limited this paper seeks to redress this deficit by providing a description of the characteristics of fair trade including definitional issues market size and segmentation and the key organizations it discusses fair trade from southern producer and northern trader and consumer perspectives and highlights the key issues that currently face the fair trade movement it then identifies an initial research agenda to be followed up in subsequent papers

the sustainable development index measuring the ecological efficiency of human development in the anthropocene abstract when the human development index hdi was introduced in the 1990s it was an important step toward a more sensible measure of progress one defined less by gdp growth and more by social goals but the limitations of hdi have become clear in the 21st century given a growing crisis of climate change and ecological breakdown hdi pays no attention to ecology and retains an emphasis on high levels of income that given strong correlations between income and ecological impact violates sustainability principles the countries that score highest on the hdi also contribute most in per capita terms to climate change and other forms of ecological breakdown in this sense hdi promotes a model of development that is empirically incompatible with ecological stability and impossible to universalize in this paper i propose an alternative index that corrects for these problems the sustainable development index sdi the sdi retains the base formula of the hdi but places a sufficiency threshold on per capita income and divides by two key indicators of ecological impact co2 emissions and material footprint both calculated in per capita consumption based terms and rendered vis a vis planetary boundaries the sdi is an indicator of strong sustainability that measures nations ecological efficiency in delivering human development

global policy at the zero lower bound in a large scale dsge model abstract this paper analyses whether fiscal policies can alleviate the effects of a global recession that drives interest rates to the zero lower bound additionally we study the benefits of international coordination the analysis is carried out using a dynamic general equilibrium model of the global economy eagle model we consider that the fiscal shocks are temporary and that fiscal policy retains full credibility at all times in this setup we find significant non linearities in a zero lower bound situation that amplify the effects of fiscal shocks compared to the non zero lower bound case international coordination is helpful but does not play a major role in the results

a degrowth transition pathways for the degrowth niche to replace the capitalist growth regime abstract facing the intertwined environmental social and economic crisis requires us to seriously consider alternatives to the current capitalist system including the emerging concept of degrowth existing understandings of degrowth have focused on characterizing the shape the key elements and the proposals for a degrowth society however its dynamic and evolving nature as an alternative vision of the future and the dynamics of a transition toward degrowth are inadequately considered this paper seeks to address this conceptual gap through a reconceptualisation of degrowth as a radical niche innovation to the capitalist growth regime by extending the multi level perspective framework to the capitalist growth system we undertake a critical reconsideration of the multi level perspective exposing key assumptions of this framework grounded in capitalist economic theory through this we propose a pluriversal potential pathway for change to consider this further a bibliometric analysis is used to measure and visualize research activity in degrowth as a proxy for the processes of development of the degrowth niche then we return to the multi level perspective to consider two potential pathways for change involving the degrowth niche and the capitalist growth regime finally we point to areas for further research that build on this new conceptualisation of a degrowth transition

towards more accurate and policy relevant footprint analyses tracing fine scale socio environmental impacts of production to consumption the consumption of internationally traded goods causes multiple socio environmental impacts current methods linking production impacts to final consumption typically trace the origin of products back to the country level lacking fine scale spatial resolution this hampers accurate calculation of trade and consumption footprints masking and distorting the causal links between consumers choices and their environmental impacts especially in countries with large spatial variability in socio environmental conditions and production impacts here we present the sei pcs model spatially explicit information on production to consumption systems which allows for fine scale sub national assessments of the origin of and socio environmental impacts embedded in traded commodities the method connects detailed production data at sub national scales e g municipalities or provinces information on domestic flows of goods and in international trade the model permits the downscaling of country to country trade analyses based on either physical allocation from bilateral trade matrices or mrio models the importance of producing more spatially explicit trade analyses is illustrated by identifying the municipalities of brazil from which different countries source the brazilian soy they consume applications for improving consumption accounting and policy assessment are discussed including quantification of externalities of consumption consumer labeling trade leakages sustainable resource supply and traceability

recursos naturales diversificacion y crecimiento regional en el peru based upon the export product space this paper shows the main features of the export product composition of peru and its regions with respect to export baskets these include a high con centration in few commodities a relatively low degree of similarity between products relatively high levels of productivity at the international level and enormous undiscovered or untapped export potential in addition this paper analyzes the hypothesis that the natural resource curse affects regional growth employment and export diversification subject to the limitations of the data and the heterogeneous panel methods employed estimation results indicate that the share of natural capital out of the total tangible wealth and natural capital per capita seems on average and in a relatively statistically robust way to spur growth primary employment and export concentration in a few products consequently the natural resource curse for the peruvian regions is not about growth but about low regional development since such resources do not have a significant impact on secondary and tertiary employment or on export product diversification

from ecological macroeconomics to a theory of endogenous money for a finite planet abstract this paper takes stock of the achievements and gaps of the emerging field of ecological macroeconomics which has brought insights from specific schools of macroeconomics most notably post keynesian to ecological economics with a strong emphasis on the endogeneity of money ecological macroeconomics has proposed fiscal monetary and prudential reforms to boost green investments and developed new modeling frameworks to explore the interactions between the financial macroeconomic and biophysical spheres while these proposals open a broader range of possibilities to engage in a socio ecological transition than those offered by the current paradigm of a financialized global economy they paradoxically suffer from similar limitations by placing much faith in green investments they impose a vision of the transition that presents strong technical and institutional limitations the field also fails to revisit its own understanding of macroeconomics and of specific phenomena e g financial instability through a biophysical lens in spite of increasing transdisciplinary evidence supporting this approach we suggest overcoming these limitations through institutionalist perspectives that understand money as a language through which value is created and legitimized those perspectives seem essential to re embed the governance of money within a worldview that acknowledges the finiteness and incommensurable values of earth s life support systems

overcoming the zero bound on nominal interest rates with negative interest on currency gesell s solution an economy is in a liquidity trap when monetary policy cannot influence either real or nominal variables of interest a necessary condition for this is that the short nominal interest rate is constrained by its lower bound typically zero the paper considers two small analytical models one old keynesian the other new keynesian possessing equilibria where not only the short nominal interest rate but nominal interest rates at all maturities can be stuck at their zero lower bound when the authorities remove the zero nominal interest rate floor by adopting an augmented monetary rule that systematically keeps the nominal interest rate on base money including currency at or below the nominal interest rate on non monetary instruments the lower bound equilibria are eliminated thus allowing an economic system to avoid the trap or to escape from it this rule will involve paying negative interest on currency that is imposing a carry tax on currency an idea first promoted by gesell the administration costs associated with a currency carry tax must be set against the benefits of potentially lower shoe leather costs and lower menu costs which are made possible by the its introduction there are also output gap avoidance benefits from eliminating the zero lower bound trap

the economics of degrowth economic degrowth is ecologically desirable and possibly inevitable but under what conditions can it become socially sustainable how can we have full employment and economic stability without growth what will happen to public spending and to public debt how would production be organised in a degrowing economy and under what plausible socio political conditions could such grand changes happen standard economic theories and models ignore these questions for them economic growth is an axiomatic necessity this article reviews recent contributions in the economics of degrowth and identifies research avenues for ecological economists

optimal monetary policy under commitment with a zero bound on nominal interest rates we determine optimal monetary policy under commitment in a forwardlooking new keynesian model when nominal interest rates are bounded below by zero the lower bound represents an occasionally binding constraint that causes the model and optimal policy to be nonlinear a calibration to the u s economy suggests that policy should reduce nominal interest rates more aggressively than suggested by a model without lower bound rational agents anticipate the possibility of reaching the lower bound in the future and this amplifies the effects of adverse shocks well before the bound is reached while the empirical magnitude of u s mark up shocks seems too small to entail zero nominal interest rates shocks affecting the natural real interest rate plausibly lead to a binding lower bound under optimal policy however this occurs quite infrequently and does not imply positive average inflation rates in equilibrium interestingly the presence of binding real rate shocks alters the policy response to non binding markup shocks

food regimes and their trade links a socio ecological perspective abstract the concept of food regimes has become a prominent theory in political economy we here provide socio ecological underpinning of the food regimes theory and thereby connect it closer to an ecological economics perspective we quantify physical trade with main agricultural commodities between world regions from the mid 19th century to 2016 and ask how trade patterns relate to issues of resource use in particular to land use soil fertility and the energetic basis of agriculture agricultural exports rose from a few million t yr around 1870 to 1 4 billion t yr in 2016 growth in trade and production did not follow a continuous trend periods of accelerated growth alternating with phases of relative stability can be distinguished rather than directed modernization we observe shifts in unequal relations of power physical exchange and environmental pressure between changing centers and peripheries the periods of growth in trade match with the periodization of food regimes we find that regime shifts are closely related to changes in societies energy metabolism in the resource base of agricultural production and also to agro ecological crisis our analysis emphasizes that food regimes not only reflect changes in power relations in the world system but also changes in societies natural relations

the high price of dematerialization a dynamic panel data analysis of material use and economic recession abstract dematerialization at the national level occurs almost exclusively during periods of economic recession or low growth while recession is not a sustainable strategy to curb environmental impact such periods may offer important insights on the possibilities of reducing material use economic recession research has focused on the interactions between macroeconomic and financial variables with little systematic research dedicated to uncovering how resource use develops during periods of recession using a dynamic panel model we investigate whether and to what extent material use in a sample of 150 economies between 1970 and 2010 was affected by recession and low growth recession occurred most frequently and in more than two thirds of all countries during the 1980s and the 1990s in the 2000s more than half of the recessions occurred during the financial crisis of 2008 periods of recession were significantly and negatively correlated with material use they tended to coincide with dematerialization material use decreased in recession years but the significant correlations with growth in material use became weaker as growth rates increased construction minerals and metals used to build stocks of manufactured capital reacted more strongly to economic fluctuations than the throughput dominated flows of biomass and fossil fuels we conclude that the systematic link between recession and dematerialization can become policy relevant if the mechanisms causing reductions in material use during these periods are identified

growth in global materials use gdp and population during the 20th century the growing industrial metabolism is a major driver of global environmental change we present an assessment of the global use of materials since the beginning of the 20th century based on the conceptual and methodological principles of material flow accounting mfa on the grounds of published statistical data data compilations and estimation procedures for material flows not covered by international statistical sources we compiled a quantitative estimate of annual global extraction of biomass fossil energy carriers metal ores industrial minerals and construction minerals for the period 1900 to 2005 this period covers important phases of global industrialisation and economic growth the paper analyses the observed changes in the overall size and composition of global material flows in relation to the global economy population growth and primary energy consumption we show that during the last century global materials use increased 8 fold humanity currently uses almost 60 billion tons gt of materials per year in particular the period after wwii was characterized by rapid physical growth driven by both population and economic growth within this period there was a shift from the dominance of renewable biomass towards mineral materials materials use increased at a slower pace than the global economy but faster than world population as a consequence material intensity i e the amount of materials required per unit of gdp declined while materials use per capita doubled from 4 6 to 10 3 t cap yr the main material groups show different trajectories while biomass use hardly keeps up with population growth the mineral fractions grow at a rapid pace we show that increases in material productivity are mostly due to the slow growth of biomass use while they are much less pronounced for the mineral fractions so far there is no evidence that growth of global materials use is slowing down or might eventually decline and our results indicate that an increase in material productivity is a general feature of economic development

overcoming the zero bound on interest rate policy the paper proposes three options for overcoming the zero bound on interest rate policy a carry tax on money open market operations in long bonds and monetary transfers a variable carry tax on electronic bank reserves could enable a central bank to target negative nominal interest rates a carry tax could be imposed on currency to create more leeway to make interest rates negative quantitative policy monetary transfers and open market purchases of long bonds could stimulate the economy by creating liquidity broadly defined a central bank needs more fiscal support than usual from the treasury to pursue quantitative policy at the interest rate floor

the material basis of the global economy worldwide patterns of natural resource extraction and their implications for sustainable resource use policies abstract material flow accounting and analysis mfa has been established as an influential framework for quantifying the use of natural resources by modern societies so far however no reference data for overall scale and trends of global extraction of natural resources and their distribution between different world regions has been available this paper presents the first comprehensive quantification of the material basis of the global economy i e used domestic extraction in a time series from 1980 to 2002 we analyse time trends for major material groups fossil fuels metals industrial and construction minerals and biomass disaggregated into seven world regions this allows for a an illustration of the global economy s physical growth driven by worldwide processes of economic integration over the past decades and b an indication of the worldwide distribution of environmental pressures associated with material extraction the results show that annual resource consumption of the world economy increased by about one third between 1980 and 2002 this indicates that scale effects due to economic growth more than compensated for other effects such as the relative increase of the service sectors contribution to gdp structural effect and the use of new production technologies with higher material and energy efficiency technology effect the observed growth of natural resource extraction is unevenly distributed over the main material categories with metals showing the highest growth rate the regional analysis shows the increasing importance of asia and latin america in global resource extraction on the global level material intensity i e resource extraction per unit of gdp decreased by about 25 indicating relative decoupling of resource extraction from economic growth the paper concludes with policy recommendations for a more sustainable use of natural resources

deflation and monetary policy in a historical perspective remembering the past or being condemned to repeat it inflation is currently low and stable in industrialized countries but might deflation replace inflation as a major policy concern we present a broad cross country historical study of deflation over the past two centuries in order to shed light on current policy challenges in the light of the relevant theoretical approaches we empirically characterize good bad and ugly deflations assess similarities between the current low inflation environment and that of the gold standard period and discuss lessons from the historical record as to policies to escape undesirable deflation and the relative merits of interest rate and monetary instruments michael bordo and andrew filardo

the perils of taylor rules abstract since john taylor s 1993 carnegie rochester conf ser publ policy39 195 214 seminal paper a large literature has argued that active interest rate feedback rules that is rules that respond to increases in inflation with a more than one for one increase in the nominal interest rate are stabilizing in this paper we argue that once the zero bound on nominal interest rates is taken into account active interest rate feedback rules can easily lead to unexpected consequences specifically we show that even if the steady state at which monetary policy is active is locally the unique equilibrium typically there exist an infinite number of equilibrium trajectories originating arbitrarily close to that steady state that converge to a liquidity trap that is a steady state in which the nominal interest rate is near zero and inflation is possibly negative journal of economic literature classification numbers e52 e31 e63

reconsidering monetary policy an empirical examination of the relationship between interest rates and nominal gdp growth in the u s u k germany and japan abstract the rate of interest the price of money is said to be a key policy tool economics has in general emphasised prices this theoretical bias results from the axiomatic deductive methodology centring on equilibrium without equilibrium quantity constraints are more important than prices in determining market outcomes in disequilibrium interest rates should be far less useful as policy variable and economics should be more concerned with quantities including resource constraints to investigate we test the received belief that lower interest rates result in higher growth and higher rates result in lower growth examining the relationship between 3 month and 10 year benchmark rates and nominal gdp growth over half a century in four of the five largest economies we find that interest rates follow gdp growth and are consistently positively correlated with growth if policy makers really aimed at setting rates consistent with a recovery they would need to raise them we conclude that conventional monetary policy as operated by central banks for the past half century is fundamentally flawed policy makers had better focus on the quantity variables that cause growth

the pricing of interest rate risk evidence from the stock market this paper addresses the issue of whether firms are required to pay an ex ante premium to investors for bearing the risk of interest rate changes a two factor apt model with the market and changes in the yield on long term government bonds as factors is employed the paper shows that empirically most of the interest sensitive stocks are in the utility industries and that there is reasonable evidence that the interest factor is priced in the sense of the apt several sources for the interest sensitivity are considered and regulatory lags are focused on as a likely candidate some firms exhibit ex post sensitivity in their stock returns to unanticipated changes in interest rates are these firms required to pay investors ex ante for bearing this risk of interest rate changes the framework for examining pricing of unanticipated interest rate changes is a two factor apt model with the market and changes in the yield on long term government bonds as factors the issue is whether the interest rate change premium is significant to study this the paper uses full information maximum likelihood fiml estimation on groups of twenty five individual firms with both cross equation constraints and withinequation nonlinear constraints on the parameters as mandated by the apt model whether the risk of unanticipated changes in interest rates is priced in the market is of particular interest with regard to regulated firms regulated firms especially electric utilities turn out to comprise the big majority of firms that are sensitive to unanticipated interest rate changes after some preliminary investigation the analysis focuses on electric utilities much empirical work on the apt relies on factor analysis e g roll and ross 30 bower bower and logue 5 use factor analysis in comparing the apt and the capm to explain utilities returns the present paper however uses observable variables at the macro level chan chen and hsieh cch 7 and chen roll and ross crr 8 also examine apt models with specific macroeconomic factors cch and crr use a traditional fama macbeth type of cross sectional estimation approach in the premia calculations rather than a fiml approach gibbons and stambaugh have applied fiml techniques to models using only the market as an explanatory variable gibbons 20 used a noniterative algorithm on portfolios of firms equivalent to a two step cross sectional approach stam

india s biophysical economy 1961 2008 sustainability in a national and global context india s economic growth in the last decade has raised several concerns in terms of its present and future resource demands for materials and energy while per capita resource consumption is still extremely modest but on the rise its sheer population qualifies india as a fast growing giant with material and energy throughput that is growing rapidly if such national and local trends continue the challenges for regional national as well as global sustainability are immense in terms of future resource availability social conflicts pressure on land and ecosystems and atmospheric emissions using the concepts of social metabolism and material flow analysis this paper presents an original study quantifying resource use trajectories for india from 1961 up to 2008 we argue for india s need to grow in order to be able to provide a reasonable material standard of living for its vast population to this end the challenge is in avoiding the precarious path so far followed by industrialised countries in europe and asia but to opt for a regime shift towards sustainability in terms of resource use by building on a host of promising examples and taking opportunities of existing niches to make india a trendsetter

global patterns of materials use a socioeconomic and geophysical analysis abstract human use of materials is a major driver of global environmental change the links between materials use and economic development are central to the challenge of decoupling of materials use and economic growth dematerialization this article presents a new global material flow dataset compiled for the year 2000 covering 175 countries including both extraction and trade flows and comprising four major material categories biomass construction minerals fossil energy carriers and ores industrial minerals first we quantify the variability and distributional inequality gini coefficients in international material consumption we then measure the influence of the drivers population gdp land area and climate this analysis yields international income elasticities of material use finally we examine the coupling between material flows and between income and material productivity measured in economic production per tonne material consumed material productivity is strongly coupled to income and may thus not be suitable as an international indicator of environmental progress a finding which we relate to the economic inelasticity of material consumption the results demonstrate striking differences between the material groups biomass is the most equitably distributed resource economically the most inelastic and is not correlated to any of the mineral materials the three mineral material groups are closely coupled to each other and economic activity indicating that the challenge of dematerializing industrial economies may require fundamental structural transformation our analysis provides a first systematic investigation of international differences in material use and their drivers and thus serves as the basis for more detailed future work

hidden linkages between resources and economy a beyond gdp approach using alternative welfare indicators taking gdp as the standard economic indicator for economic welfare recent resources economy studies indicate the dematerialization of the economy the so called decoupling effect this conclusion seems to alleviate concerns over resource scarcity and limits to growth and feeds optimism for green growth and sustainability prospects however the validity of gdp as the sole and unambiguous measure of the ultimate outcome of the economy has been severely disputed there is nowadays increasing interest in broader welfare measurements that capture more aspects of economic output and hence constitute better approximations of well being the present paper provides an overview of the above discussion and sets out to explore the relevance of three alternative welfare indicators the human development index hdi the index of sustainable economic welfare isew and the genuine progress indicator gpi as a basis for evaluating the dependency of welfare and its major engine the economy on natural resources increasing welfare appears to require a disproportionate use of resources strong and increasing dependency on resources at the global level and in giant countries such as china and india may have serious implications for current sustainability policies and the united nations sustainable development goals

a model for fair trade buying behaviour the role of perceived quantity and quality of information and of product specific attitudes in a sample of 615 belgians a model for fair trade buying behaviour was developed the impact of fair trade knowledge general attitudes towards fair trade attitudes towards fair trade products and the perception of the quality and quantity of fair trade information on the reported amount of money spent on fair trade products were assessed fair trade knowledge overall concern and scepticism towards fair trade and the perception of the perceived quantity and quality of fair trade information influence buying behaviour directly and indirectly through product attitudes interest in fair trade products price acceptability and product liking have a significant impact on fair trade buying behaviour product interest is the most important variable influencing buying behaviour implications for the campaigns of governments and for the marketing strategy of fair trade organisations are offered

the ecology of money a critical assessment abstract this paper assesses the proposal to transform the monetary system into an ecology of money that is into a system made of a large diversity of complementary currencies its central aim is to examine whether this proposal could provide a systemic solution to both the ecological and financial crises as several authors most notably lietaer and douthwaite have argued to this end it analyses the two main arguments in favour of this proposal first it focuses on the claim that an ecology of money would be more resilient and less prone to crisis than the present monetary system it shows that this argument suffers from several conceptual flaws and argues that it fails to provide sufficient normative reasons to favour an ecology of money second this paper analyses the claim that an ecology of money could help defeat the monetary growth imperative that supposedly plagues our economies the paper raises serious doubts about the existence of such an imperative and questions the claim that an ecology of money could contribute to weaken it in a significant way

the biophysical perspective of a middle income economy material flows in mexico abstract we analyse natural resource use dynamics in the mexican economy during the last three decades despite low and uneven economic growth the extraction and use of materials in the mexican economy has continuously increased during the last 30 years in this period population growth rather than economic growth was the main driving force for biophysical growth in addition fundamental changes have taken place in the primary sectors in manufacturing and in household consumption and these are reflected in an increasing emphasis on the use of fossil fuels and construction materials mexico s economy has been strongly influenced by international trade since the country commenced competing in international markets in the 1970s mexico mainly exported primary resources this pattern has changed and manufactured goods now have a much greater importance due to a boom in assembling industries in contrast with other latin american countries mexico has achieved a diversification of production moving towards technology intensive products and a better mix in its export portfolio however crude oil exports still represent the single most important export good mexico s material consumption is still well below the oecd average but is growing fast and the current resource use patterns may well present serious social and environmental problems to the medium and long term sustainability of mexico s economy and community information on natural resource use and resource productivity could provide valuable guidance for economic policy planning in mexico

the euthanasia of the rentier a way toward a steady state economy abstract a positive interest rate has many impacts on ecology one of them is the pushing of economic growth in the present economy accumulation of capital is an end in itself according to the golden rule of accumulation the extension rate of the capital stock is equal to the interest rate however in the present economic conditions the interest rate is always significantly higher than zero due to the liquidity premium of money keynes in this context old proposals such as the free money approach of silvio gesell could provide interesting solutions gesell wanted to neutralize the liquidity premium by putting artificial carrying costs on money by increasing the stock of capital assets without being interrupted by economic crises the interest and profitability level should be reduced down to zero because in this situation every marginal saving and marginal investment would cause a negative interest or profitability rate they would be stopped though keynes was very excited by the proposals of gesell he criticized the fact that gesell did not see many of the further obstacles however these obstacles could be overcome by means of further institutional reforms

ecological monetary economics a post keynesian critique the monetary analysis of some ecological economists currently appears to be mostly articulated around the following core a stationary economy and a fortiori a degrowth economy is incompatible with a system in which money is created as interest bearing debt to question the relevance of the debt money positive interest rate output growth nexus this paper adopts a critical stance towards the currently emerging ecological monetary economics from the standpoint of another strand of heterodox economics the post keynesian approach in its current state ecological monetary economics is at odds with post keynesian economics in its analysis of the money growth relationship this will be shown using the theory of endogenous money and a simple cambridgian kaleckian model where debt money and a positive interest rate are compatible with a full stationary economy

foreign trade and early industrialisation in the habsburg monarchy and the united kingdom two extremes in comparison the concept of socio ecological transitions is used to analyse the quantitative importance of physical imports and exports for the habsburg empire and the united kingdom in the 19th and early 20th centuries for the habsburg empire a new dataset of foreign trade and social metabolism is presented for the united kingdom the analysis relies on previously published data foreign trade volumes increased in both countries in the long run total trade volumes were much higher in the united kingdom throughout the entire time period on average by around a factor four physical factors explaining the disparities in structure and volume of foreign trade in the two countries are differences in 1 the temporal patterns of the socio ecological transition and 2 domestic resource endowments in both countries energy carrying materials i e fossil fuels and biomass were the dominant resources in physical foreign trade the analysis focuses on the physically most important material groups coal wood and cereals and discusses the role of imports and exports in relation to domestic resource provision and environmental pressures physical foreign trade increased at a faster pace than domestic resource extraction and consumption the socio ecological transition was thus accompanied by rising international integration of resource supply

monetary policy and economic fluctuations in a sticky price model abstract this paper examines a simple monetary optimizing model with sticky prices two types of monetary policy rules are considered constant money growth rules and interest rate feedback taylor type rules in the case of constant money growth rules we show the existence of limit cycles through the hopf bifurcation theorem on the other hand in the case of the interest rate feedback rules we show that active monetary policy leads to the determinacy of equilibrium path while passive monetary policy induces economic fluctuations

the role of personal values in fair trade consumption research in the u s on fair trade consumption is sparse therefore little is known as to what motivates u s consumers to buy fair trade products this study sought to determine which values are salient to american fair trade consumption the data were gathered via a web based version of the schwartz value survey svs and were gleaned from actual consumers who purchase fair trade products from a range of internet based fair trade retailers this study established that indeed there are significant interactions between personal values and fair trade consumption and that demographics proved to be useless in creating a profile of the american fair trade consumer

biophysical structure of the ecuadorian economy foreign trade and policy implications abstract at the core of this paper lays the notion that a systematic analysis of material flow accounts enables us to discuss the sustainability of an economic model ecuador is going through a socio ecological transition from an agrarian towards an industrial regime based on the use of nonrenewable sources of materials and energy direct material flow indicators are used in this article to analyze the ecological dimension of the economy of ecuador during 1970 2007 this approach enables the concept of societal metabolism to become operative the paper compares societal metabolic profiles showing that per capita use of materials is still at about one fifth of the average in the high income countries of the world physical flows of trade indicate that there is an ecologically unequal exchange whereas a positive trade balance is desirable from an economic policy its counterpart in physical units has been a persistent net outflow of material resources the extraction of which causes environmental impacts and social conflicts

new developments in monetary economics two ghosts two eccentricities a fallacy a mirage and a mythos monetary theory and policy are part of intertemporal public finance the two ghosts are the liquidity trap and the real balance effect the eccentricities are negative nominal interest rates and the helicopter drop of money the fallacy is the fiscal theory of the price level a logically inconsistent theory of the link between the government s intertemporal budget constraint and the general price level the mirage is the prediction that financial deregulation and technical change in the payments and settlements technology will cause monetary policy to lose its capacity to influence even nominal economic variables mythos refers to the independent central bank

monetary policy financial stability and the zero lower bound abstract much has happened in the world of central banking in the past decade in this paper i focus on three issues associated with the zero lower bound zlb on short term nominal interest rates and the nexus between monetary policy and financial stability 1 whether we are moving toward a permanently lower long run equilibrium real interest rate 2 what steps can be taken to mitigate the constraints imposed by the zlb and 3 whether and how financial stability considerations should be incorporated in the conduct of monetary policy these important topics deserve the attention of both academic and government professionals

changes in the united kingdom s natural relations in terms of society s metabolism and land use from 1850 to the present day abstract in this paper we present our understanding of how society and nature have interacted in the course of history in terms of society s metabolic interchange with the biophysical environment presenting a theoretical model we begin by focusing on the interface between society and nature society s natural relations as conceptualized by the idea of metabolism which draws upon marxist theory complemented by a systems approach the concept of metabolism portrays society as a system which has to establish and maintain a permanent throughput of energy and matter to produce and maintain society s material components the amount of resource flow is operationalized by using material and energy flow accounting methods empirically these methods are applied to the uk s economy in a time series approach from 1850 to the present day we discuss different aggregates of inputs such as domestic material extraction foreign trade of materials energy input and additionally give an account of land use change obviously these changing natural relations are linked to socio economic activities hence we make a first attempt to discuss different periods of socio economic development by drawing from a regulation approach and try to link them to physical indicators such as direct material and energy input and domestic material consumption dmc thereby we hope to contribute to a historical understanding of socio economically driven environmental change within the framework of ecological economics

socio ecological regime transitions in austria and the united kingdom we employ the concepts of socio ecological regime and regime transition to better understand the biophysical causes and consequences of industrialization for two case studies the united kingdom and austria we describe two steps in a major transition from an agrarian to an industrial socio ecological regime and the resulting consequences for energy use land use and labour organization in a first step the coal based industrial regime co existed with an agricultural sector remaining within the bounds of the old regime in a second step the oil electricity based industrial regime agriculture was integrated into the new pattern and the socio ecological transition had been completed industrialization offers an answer to the input and growth related sustainability problems of the agrarian regime but creates new sustainability problems of a larger scale while today s industrial societies are stabilizing their resource use albeit at an unsustainable level large parts of the global society are in midst of the old industrial transition this poses severe problems for global sustainability

a note on noise in the market for bankrupt firms securities abstract the well documented phenomena of departures from the absolute priority rule apr have provoked an important public policy debate over their consequences some scholars argue that apr violations increase economic efficiency because they play an important role in the avoidance of inefficient liquidations and also mitigate inefficient risk incentives another group argues that apr violations should be abolished because they add greater uncertainty to the security valuation process that is they increase noise in security prices to date however no evidence has been presented on the issue of how much noise apr violations add we develop a theoretical model that allows an empirical test of the effect of apr violations on noise our results suggest that apr violations importantly increase noise indeed at least 30 percent and as much as 85 percent of the noise in security prices may be attributable to apr violations this does not suggest that the beneficial effects of apr violations are nonexistent or unimportant but it does imply that failing to account for the effect of apr violations on noise in any modelling of optimal bankruptcy rules may lead to a suboptimal design we also find that the amount of noise in this market appears to have declined over time as more institutional informed investors have entered the market for bankrupt firms securities and the effect of change in the bankruptcy law has become clearer both consistent with the noisy rational expectations hypothesis

a case study of a phosphorus chemical firm s application of resource efficiency and eco efficiency in industrial metabolism under circular economy abstract circular economy plays an essential and useful role in china in considering economic and ecological sustainability individual firms as the primary implements of a circular economy are facing many obstacles at present in aspects of resource and ecological efficiency therefore this study presents a set of tools to help decision makers better solve these problems and to guide resource based chemical industries in sustainable development first this study describes resource efficiency based on the sfa of a selected p chemistry firm and identifies the key potential opportunities for improvement using analysis tools and assessment tools furthermore by applying eco design and decision tools a firm level p chemical circular economic system is designed and constructed a phosphorus chemical optimization model is established and relevant successive scenarios are generated finally the corresponding feasible solutions and policy recommendations are proposed to improve economic benefit resource efficiency waste recycling rate and eco efficiency after industry design planning and technological progress the total economic benefit increases dramatically and the recycling efficiencies of accompanying resources f si i and s improve by different degrees the results demonstrate that the economic benefit of phosphorus products increases by 28 5 and p utilization efficiency correspondingly increases from 81 1 to 94 7 the comprehensive utilization efficiency of phosphor gypsum increases to 100 and the eco efficiency could be improved significantly by eliminating the phosphor gypsum stack this study demonstrates that technological progress in mineral processing and the production of associated products is the endogenic motivation to increase economic benefit and improve resource efficiency the method proposed in this paper can be applied duplicated and spread not only within the p chemical industry but also in other resource based chemical industries

the optimal cash balance proposition maurice allais priority maurice allais well deserved nobel prize fortuitously brought to our attention an injustice inadvertently done him to which we were unknowing accessories for years the literature has ascribed to us the parentage of the transactions cost model of optimal cash balances with its notorious square rootformula derivedfrom inventory theory recently we found that its essence is contained in allais 1947 economie et interet pp 238 41 as jacob viner used to say no matter to what source the origin of an economic proposition is ascribed someone is sure to come up with an earlier one in any event here is a translation of the pertinent passages allais describes the model in footnotes 11 and 12 to the following text pp 238 41

the effect of globalisation on water consumption a case study of the spanish virtual water trade 1849 1935 abstract this paper aims to analyse the impact on water consumption of trade expansion in the first era of globalisation to that end we have chosen the case of spain a semi arid country with significant cyclical water shortages more specifically we are interested in answering the following questions what volume of water was required for exports of agricultural and food products how did this variable evolve over time which factors drove this evolution in short we wish to understand the impact on water resources of spain s entry into world agriculture and food markets firstly we examine virtual water trade flows in the long run secondly we attempt to disentangle certain major driving forces underlying these trajectories in order to establish the role played by trade in the final net balance of water a decomposition analysis da is applied our findings show the great pressures that the first globalisation imposed on not only domestic but also foreign water resources trade volumes as well as trade patterns were essential factors driving rising virtual water flows while yield improvements contributed smoothly to moderation in the expansion of water flows