8.2 Pre-Analytical Visions
8.2
Pre-Analytical Visions
The concern about scale in
ecological economics is related to what Herman Daly has called its different
“pre-analytical vision” from that of the neo-classical mainstream. These
visions can be represented diagrammatically as follows:
8.2.1
Pre-Analytic vision of neo-classical (mainstream) economics
Figure 8.2.1 sourced from Feasta
under a Creative
Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License.
http://www.feasta.org/2012/04/11/an-introduction-to-ecological-economics/
The relationship between
the economy and the ecological system is essentially colonial – profit
maximising companies push what are termed “environmental costs” unpaid for onto
the world around them which economists call “externalities”
as if they are minor
aberrations in an otherwise efficient system. This aberration can be corrected
for as long as prices for resources and waste absorption by the planet are set
correctly to incentivize markets to provide substitutes for scarce resources
and alternative arrangements for waste absorption. The economy can go on
expanding indefinitely.
8.2.2 Pre-analytic vision
of
ecological
economics
Figure 8.2.2 sourced from Feasta
under a Creative
Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License.
http://www.feasta.org/2012/04/11/an-introduction-to-ecological-economics/
In this vision the economy
cannot go on expanding in what Daly terms the “full world” situation. The
availability of “natural capital” sets restraints on how much the economy can
expand both in regard to sources of materials and energy and in regard to
“sinks” where the wastes of economic activity have to be absorbed by the
planet. Moreover certain inputs into the economy are absolutely crucial because
they enter into all economic activity – specifically energy inputs which power
all the machines and devices of modern civilisation. It is true that materials
like metals can be recycled but this takes energy and there is always some net
loss.
Moreover, most energy is
currently fossil energy and is non renewable. It is subject to the laws of
physics and entropy. One cannot recycle energy and there is evidence that it is
becoming more costly, in energy terms to access fossil energy (coal, oil and
gas). At the same time there are absolute limits on the amount of renewable
energy too, which, because it is less dense and intermittent, is not such a
convenient source.