The Difference between Ecological Economics and ...



The Difference between Ecological Economics and Neoclassical Economics

Through this module we will present the users with information on the differences between Ecological Economics and Neoclassical Economics. There will be three main objectives with supplemental activities which will provide the necessary background information and other avenues to formulate a logical difference between these two disciplines of economics. The areas the objectives will touch on are the history and development of Ecological Economics, the idea that Ecological Economics uses a transdisciplinary approach to problem solving and possible ways for people to make conscience decisions toward promoting the goals of Ecological Economics. Supplemental activities to the above objectives are aimed so that the users have the chance to reflect and write what they have read about. It will also give them the ability to take a step back to evaluate their lives and surroundings to see how little changes in actions can have a big impact.

Objective 1:

• Background and Historical context of Neoclassical Economics and Ecological Economics.

Ecological economics is a transdisciplinary field of research that addresses the

interdependence between humans and the natural ecosystems of the world. Ecological

economics was “created” because people were distraught by the depletion of nature for

pure economic growth. These people realized that while the economy does not really

have an end to its growth potential the environment that we harvest from does, and for

the sake of those who inhabit this earth with us, as well as for ourselves we had better

cut back or stop our depletion of the earths goods. With these ideas there was the birth

of Ecological Economics.

The concepts of Ecological economics have been romanticized about since the

1880s, when early economist Reverend T. Malthus tried to take nature into economic

consideration, but it was not until the 1970s or eighties that the concept was

institutionalized (there is some debate over whether it was institutionalized in 1974 with

the establishment of the Journal of Environmental Economics and Management

(JEEM), co-edited by Allen Kneese and Ralph dʼArge or with the International Society

for Ecological Economics in 1988). The long gestation time before E.E. was established

as a field of economics was a period of field research and a time for formalizing the

basic ideas of ecological economics. Post World War II people were enjoying the

economic growth and thought little of its ecological impacts. They truly believed that the

more growth there was the better life would get, and to some extent people still believe

this today. Though this field has been in print for nearly forty years our society still has

insatiable wants and desires degrading the environment.

Activity for Objective 1:

• Read chapter 2 in An Introduction to Ecological Economics, titled “The Historical Development of Ecology and Economics” found here:

• In response to this reading sit down for ten minutes and do a stream-of-consciousness free write about what you just read.

Objective 2

• A Comparison of Neoclassical Economics to Ecological Economics

o Now that you have a brief history of Ecological Economics it time to understand the approach Ecological Economics takes in regards to problem solving.

Traditional economics is a unified discipline, it uses established theories to dictate how the market will react to situations. These theories cover everything from human rationality to the properties of matter. There is a major flaw in assuming that all people and companies react in specific ways to different stimuli. Ecological economics, instead of using given theories, allows for the adoption of new ideas, information, and research methods. Modern environmental problems are just too complex to be viewed from a single perspective; this transdiscipline approach uses the best possible viewpoints to gain a better understanding of a problem.

Ecological economics incorporates the ideas of different disciplines by not defining a specific set of methods for understanding the world around us. In a transdiscipline approach, a problem is first evaluated, and then researchers decide what methods they will use to better understand the issue. The tools and methods applied should include ideas from across many disciplines, this is the actual definition of transdiscipline. There have been other attempts at combining various fields of study to understand a problem, and then attempts to combine them to come to conclusions. The problem is that research in different fields is almost always communicated in different ways, making it quite hard to understand the material unless you’re an expert.

Activities for Objective 2:

1) Watch the introduction to the talk given by Dr. Robert Costanza discussing the Principles of Ecological Economics. (approximately the first 10 minutes) at .

After watching this video write a blog entry about certain components that you found particularly interesting or compelling. Be sure to discuss some of the key principles Dr. Costanza mentions in his speech. You can also reply to someone else’s entry to generate some further discussion of topics.

2) Follow up the two readings by going over the “Key Concepts” and definitions from Earth Economics at . This will help you focus in on some big ideas that are important in the world of Ecological Economics.

3) After doing these readings and watching the video it is time to organize what you have learned. Make a chart for both ecological economics and neoclassical economics. On each respective side put the main points for each school of thought. This will compare the two visually and clearly mark the differences between the two.

Objective 3:

• What can You Do?

o Now with the new knowledge of Ecological Economics next will be ways in which you can act accordingly in your daily lives. Little changes can make a big impact.

Ecological Economics is not simply a laundry list of complaints against the current state of the world. There are many easily accomplishable ecologically economic actions that one can take to save money, reduce consumption, and, by doing so, help the environment. Below are just a few of the many things an individual can do to both decrease harmful consumption and save money.

The two simplest and cheapest ways to save on lighting costs and help the environment are turning off the lights as one leaves a room and utilizing natural lighting as much as possible. Incandescent light bulbs can be replaced with compact fluorescent lights (CFLs). Though CFLs are initially more expensive, they use between 50-80% less power than a conventional light bulb, and last far longer. The longer life and decreased power consumption translate into substantial savings over the life of the bulb[1]. With energy prices rising considerably, CFLs are one of the best investments a person can make.

There are many other areas in which ecologically conscious choices can save a great deal of money, one of the most common being utensils.

By using reusable cups, plates, and cutlery, rather than disposable, the user will save a great deal of money immediately. With a onetime expenditure of about $0.99 at standard thrift stores, one obtains an almost infinitely reusable item which reduces the need for further consumption, and its associated costs.

Other ways to reduce consumption include walking or riding a bike when running errands or commuting. In addition to saving money on gasoline and car maintenance and reducing consumption, the health benefits are enormous. In the event that one lives in an area with adequate public transit, ride it. If none of the aforementioned options are viable, combine car trips into one or carpool. This will save gasoline, good for both one’s wallet and the environment.

Environmental awareness extends to construction as well. When demolishing a structure, try to salvage as many materials as possible. This will save money and reduce the need to consume virgin materials at a later date.

When building a home, insulate it and investigate sustainable building techniques and recycled materials[2]. Budget permitting, consider installing solar panels to supplement the home’s power usage. Turn the thermostat down in the winter and up in the summer.

Numerous small steps we take to reduce waste create considerable savings. The above suggestions are just a starting point for us to live in a more harmonious and socially responsible way with the environment and the world at large.

Activities for Objective 3:

• Read the articles in the links below and write about at least one ecologically economic choice you will start undertaking. Keep a logbook recording when you do that activity, and after a month estimate how much money you have saved.





• Write a letter to your congress person expressing your opinion about what can be done to make sustainable building practices more affordable to the masses. (Example, I feel that homes that install solar panels should be paid for their electricity by the kWh. This would encourage energy production by environmentally friendly means.)

• Read the article titled, The Importance of Ecological Economics to Wildlife Conservation. This article will allow you to see an alternative view how others are using ecological economics in their respective fields.

o

Now that you have learned about the histories of both Neoclassical and Ecological Economics, compared the two fields of economics and learned of ways in which you can make conscience decisions, you should have a coherent understanding of the two fields. These objectives hopefully have cleared some questions and opened up some avenues in which you can further your study of Ecological Economics in the near future. Remember little changes can have profound impacts!

Inventory of Links and Resources for Group 9: The Difference between Ecological Economics and Neoclassical Economics

Historical Context from Earth Economics, Chapter 2 in An Introduction to Ecological Economics



Retrieved 18 February 2008

"Energy Efficient Lighting." eartheasy. 1 Jan. 2000-2008. eartheasy. 20 Feb. 2008 .

Gogoi, Pallavi. "The Greening of the U.S. Consumer." BusinessWeek. 5 Feb. 2008. BusinessWeek. 20 Feb. 2008 .

Growing the Local Food Movement. 1 Oct. 2005. 20 Feb. 2008 .

"Suppliers of Alternative Building Materials." EcoBusinessLinks. 1 Jan. 1998-2008. EcoBusinessLinks. 20 Feb. 2008 .

“Principles of Ecological Economics,” speech given by Dr. Robert Costanza in Seattle.

Retrieved 6 March 2008

The Importance of Ecological Economics to Wildlife Conservation

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[1] "Energy Efficient Lighting." eartheasy. 1 Jan. 2000-2008. eartheasy. 20 Feb. 2008 .

[2] "Suppliers of Alternative Building Materials." EcoBusinessLinks. 1 Jan. 1998-2008. EcoBusinessLinks. 20 Feb. 2008 .

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