Lecture05 Why Economists Disagree: The common blindspot on the Environment

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The position of the economy in the environment is a shared blindspot in economics: no existing school handles the topic well, and yet this is the key issue we need to understand. I explain the Laws of Thermodynamics–as well as I could in an introductory class without using mathematics–and provide some links to important topics that students wouldn’t normally hear about in an economics degree.

Click here for the Powerpoint slides.

About Steve Keen

I am Professor of Economics and Head of Economics, History and Politics at Kingston University London, and a long time critic of conventional economic thought. As well as attacking mainstream thought in Debunking Economics, I am also developing an alternative dynamic approach to economic modelling. The key issue I am tackling here is the prospect for a debt-deflation on the back of the enormous private debts accumulated globally, and our very low rate of inflation.
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8 Responses to Lecture05 Why Economists Disagree: The common blindspot on the Environment

  1. Newtownian says:

    Hi Steve, Great to see this post at last (if not the so far very limited stampede of views/comments – hopefully this will change?

    I had been worried that like the rest of the mainstream (non ecological) economics community you were having trouble with siloing. But you have allayed my fears entirely with this offering. Some parting comments.

    1. Any chance you could repost the link to the Dutch student/lecturer discussion? It sounds like fun to watch.

    2. I was delighted to see you didnt limit your focus to climate change. That is one issue that seems to be getting the mainstream to question their paradigms – but then they dont take it further back to the other Gorillas in the room like footprint analysis and of course the LTG heresy.

    Or at the least attacks the nonsense that infinite growth is possible or admit economists need to urgently understand what their natural science colleagues have been screaming at them for over 40 years.

    3. On the matter of energy and natural resources, in case you havent seen it you might be interested in “STEEN, B. & BORG, G. 2002. An estimation of the cost of sustainable production of metal concentrates from the earth’s crust. Ecological Economics, 42, 401-413. (they also have a followup on phosphorus). and BARDI, U. 2010. Extracting minerals from seawater: an energy analysis. Sustainability, 2, 980-992.

    If you combine their figures (Bardi is a factor of 10 out but the principle is ok) with current primary material demand from the USGS e.g. U.S. GEOLOGICAL SURVEY 2011. Mineral commodity summaries 2011. you will find another illustration of your concerns in that the amount of energy required to mine bedrock as some economists think possible is beyond a joke.

    I mention this because it was one of those economist furphies proposed by the great Dr Strangelove model and futurist in our younger years – Herman Kahn – who wasnt stupid and should have known better.

    4. An interesting and underappreciated degradation form of interest to neo-physiocrats is the degradation of land productivity. Of course there is the issue of replacing primary nutrients, but changes in cations and erosion are just as concerning and more like a cancer – have a look on Googlearch images of the Amazon River. Its not just the deforestation.

    5. Any thoughts on the pointy end of policy change …. in particular the lack of recognition of the issues you present by so called Green politicians and their lack of ability to deal with Devil’s Alternatives – I recommend looking at the joke economic policy of the Australia Greens in this regard. Last time I looked they still didnt seem to get it like you obviously do.

    Separately any thoughts on Naomi Klein?

    6. Finally your piece pleases me greatly because I have been searching in vain for years for evidence that progressive economists of the orientation you can read via the RER web site and see from the Stiglitz mob understand the need for change in the profession.

  2. Josh Floyd says:

    Hi Steve, this is a terrific use of Tom Murphy’s work to make the case for limits to economic growth, thank you.

    I’d highly recommend also reading this post from Tom: http://physics.ucsd.edu/do-the-math/2013/05/elusive-entropy/. It’s a highly accessible treatment of problems with the way the second law of thermodynamics is interpreted in ecological economics. The case that Tom makes is very similar to one that I make in a 2007 article in the journal Futures (which I sent to you for reference mid last year, but possibly went by you as I think you were i in the process of moving to the UK around then).

    I’d be very happy to talk further with you sometime about implications for presenting material on physical limits in context of economic thinking, if you felt that would be beneficial.

    Kind regards,
    Josh Floyd

  3. Steve Keen says:

    Many thanks Josh,

    I did miss that paper–please resend it to me: debunking AT gmail DOT com. And that conversation would be incredibly beneficial. Drop me a line and let’s arrange to have a chat on Skype.

  4. maifei2050 says:

    Hi Steve
    Great to listen to your lecture. I was wondering where you stood on the ecology issue.
    BIG Question: If the current debt/money system is faulty and human civilisation is in ecological overshoot, what would a new money/economic system look like that can reduce and then stabilise human impact on the planet?

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  6. Bhaskara II says:

    Happy New Year professor Keen and every one!

  7. bobwise32952 says:

    It’s wonderful to hear an economist talking about the laws of thermodynamics, not to mention referring to The LImits to Growth. Bravo!

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