10. Ecological economies

Question 1

Structure of the lecture

Answer 1

1. Economic theory
2. The Dasgupta review, 2021
3. Case study: Spatial disparities in deforestation
4. Case study: Global fisheries

Question 2

What are 3 of the fundamental economic perspectives?

1

Answer 2

1. Malthus, 1798: On the Principle of Populations
2. Hardin, 1968: The Tragedy of the Commons
3. UN, 1987: The Brundtland Commission

Question 3

What is Malthus’ Principle of Populations?

1.1

Answer 3

Populations increase exponentially, but food production increases arithmetically. Food production cannot match population increases, and population size is limited by this. Human population will be controlled by ‘vice’, like war, famine etc.,

Question 4

What is Hardin’s 1968 Tragedy of the Commons?

1.2

Answer 4

If one or more users of the Commons increases their use beyong carrying capacity, then the Commons will become degraded, and the cost of this is borne by all users

Question 5

What did the UN’s 1987 Brundtland Commission state?

1.3

Answer 5

We require sustainable development that meets the needs of the present without compromising the ability of future generations to meet their own needs

Question 6

What are the differences between micro- and macro- economics?

1.4

Answer 6

Micro- economics is the study of behaviour of individual economic decision makers, such as households, firms, governments etc.,

Macro-economics is the study of overall economic activity over an economy. Includes, inflation, output, GDP, growth etc.,

Question 7

What is the demand curve?

1.5

Answer 7

The demand curve and consumer surplus drives biological resource extraction

There is less demand when prices are high, and more demand when prices are low.

There are some products for which demand does not change, and some for which demand increases when price increases (unique Luxury Goods called Giffen Goods)

Question 8

How is market equilibrium reached?

1.6

Answer 8

Balancing demand and supply curves.

The supply curve specifies how much of a good a producer chooses to supply to the market. Usually, less of a good is supplied when the price is low, and more of a good is supplied when price is high

Reaching market equilibrium balances the supply and demand curves

Question 9

What were the 3 main issues identified within the Dasgupta Review?

2.1

Answer 9

1. Issues with STOCK: We would require 1.6 Earth’s to maintain the world’s current living standards. Production capital doubled and stock of natural capital declined by 40% from 1940-1992.
2. Issues with DEMAND: Our demand for natural capital is impacted by size and composition of individual demands, the size of human populations, and the efficiency of converting natural services to meet demands
3. Issues with SUPPLY: Supply is impacted by the stock of natural assets, and the ability of stock to be regenerated.

Question 10

What was the main finding/conclusion of the Dasgupta review?

2.2

Answer 10

There is a fundamental mismatch between global stocks and supplies, and the demand for these products

Nature’s worth to societ is not reflected in market prices. Most of nature is open to everyone at no monetary charge, allowing exploitation

We have over-invested in produced capital and under-invested in natural assets

Question 11

What were the three proposed solutions given by the Dasgupta review?

2.3

Answer 11

1. Restructure of the global economy: Changing prices and behavioural norms, changes to family planning/women’s education. Strong arguments for quantity restriction
2. Changing social attitudes towards materialism: Promotion of a circular, second-hand economy
3. Changes in technology: Demand for changes in energy and sustainable food production

Question 13

What is a primary issue with the supply of forest products?

3.1

Answer 13

Common global patterns show that the demand for resources is spatially removed from the site of resource production.

We can monitor common patterns such as Net Primary Productivity, Population Density and GDP to understand these global trends in resource consumption

Question 14

What is embodied deforestation and what is the impact on global economies?

3.2

Answer 14

Embodied deforestation is deforestation that is associated with the production of a good or commodity

This product can then be traded elsewhere

Therefore, many countries have unfair net forest gains by importing emboided deforestation from elsehwere.

This leads to deforestation being linked to the producer country, rather than the consumer country. Negatively impacts LICs

Question 15

How do G7 residents negatively impact deforestation?

3.3

Answer 15

Drives the loss of 4 trees per year. Main drivers of global deforestation are economic development, population growth, international trade

Question 16

How are global fish stocks declining?

4.1

Answer 16

The proportion of fish stocks within biologically sustainable levels decreased from90% in 1974 to 65.8% in 2017

Industrial fishing occurs in >55% of ocean area

Spatial extent of fishing is >4 times that of agriculture

Question 17

How are nutritional requirements of fish stocks declining?

4.2

Answer 17

Nutrient yields from fisheries can be high, even in areas with a prevalence of micro-nutrient deficiencies in human populations

Hicks et al., 2018: Correlation between global zinc deficiencies and the global concentrations of zinc in the ocean

Question 18

How are local fish resources insufficient to meet local nutritional needs?

4.3

Answer 18

1. International trade deals and fishing fleets removing nutrients from their source/local populations
2. Physical, economic or institutional access to the right food
3. Food preferences and culture
4. Waste reduction
5. Conversion of catch to fish oil for animal food