M4 Flashcards
What is ‘the economy’?
The system of trade and industry by which the wealth of a country is made
and used.
A set of processes that involves its
culture, values, education, technological
evolution, history, social organization, political
structure, legal systems, and natural resources as main factors.
What kind of decoupling has the EU seen?
carbon footprint fell by 22%, even as the economy grew by 58% (issues with territorial carbon counting as well; EU as a whole has higher carbon footprint). This is relative decoupling.
How much chance do we have of staying below 1.5 degrees according to IPCC?
A 66% chance
How much carbon budget do we have according to IPCC?
420Gt co2
What is the average rate of co2 decline atm?
Less than 1%
What happens to decoupling when the economy grows?
The larger the economy becomes, the more dificult to decouple it.
Why do unregulated markets overproduce CO2?
Because the CO2 costs are not calculated into the transactions
What is a market failure?
when markets do not maximise society’s welfare; outcome is not pareto efficient (optimised)
OR mismatch between private + social costs/benefits
is climate change a market failure?
yes
What contributes to the climate change market failure?
No solution for the GHG externality; only ethical incentive for businesses right now
What are common solutions to the climate change market failure?
higher prices on carbon emissions, low carbon tech
What are other climate-related externalities?
Lack of information on how to reduce emissions, network effects, lack of innovation incentives, animal abuse
What do households give to businesses?
labour and knowledge
What do companies give to households?
goods and services
what do companies and households give to government?
taxes
what does government give to companies and households?
wages or consumption, infrastructure, institutions, other services
Imperfect markets are…
- monopolies
- info-asymmetry
- externalities
- assumption of homo economicus
- tragedy of the commons
Ultimate ends (daly triangle)
Wellbeing
Intermediate ends (daly triangle)
human capital and social capital
intermediate means (daly triangle)
built and human capital
ultimate means (daly triangle)
natural capital
tech progress can overcome poverty, can grow within planetary boundaries
smithian/tech optimism
ideology that says that we need to scale down and adhere to the planetary boundaries; in the long run the econmy will be at a steady state, poor people need to invest in having children
malthusian pessimism
How to calculate the market equilibrium
MPB = MSB = MPC
Marginal social cost > marginal private cost
Negative externalities
Marginal private benefits > marginal social benefits
Positive externalities
Are categories of environmental problems difficult to quantify cost-wise?
Yes!
Why would we focus on consumption in environmental issues?
Improving supply is too limited
Consumption solutions are ready and do not require investment
Consumption tackles responsibility issues
Hypothesis that suggests that environmental degradation worsens at the beginning of economic growth but gets better after a certain (bell curve) turning point.
Environmental kuznets curve hypothesis
What are 3 core degrowth values
autonomy, sufficiency, care
flow of products + the actors involved at each stage and value that these actors add
value chain
production, processing, distribution, retail processes that might happen before something gets to be the final product
supply chain
need to stay above this minimum resource use threshold (i.e. the ‘social foundation’) and below theenvironmental ceiling (as defined by the planetary boundaries concept)
doughnut economics (stay inside the filling of the donut)
Why could there be a food shortage?
inflation, war/conflict, concentrated markets for food industry, energy and fertiliser crisis, water crisis,
what to do against food shortage?
provide international assistence (emergency), support national social systems, strengthen food systems.
What crops are already seeing yield reduction?
soy, general, maize,
Are agricultural pests spreading?
Yes!
Do big farms get a lot of subsidy?
Yes!
What (4) is necessary for the food transition?
dietary change
reduce food waste
improve food production
save land for biodiversity/carbon sink
difficulties with food research
uncertainties, different data, different models, hard to judge if solutions have worked, for how long
Process of LED lights (red and blue), ovening plants, light, evaporation, temperature valves used to control plant output
indoor plant farming
nutritious, -95% water, no pesticides, affordable (eventually), local jobs, no waste, longer shelf life, resilient plants, less energy, labour and operational costs
selling points of indoor farming
issues with indoor farming
too high tech for global south
formal exercises aimed at engaging stakeholders to find out how important specific environmental, social and governance (ESG) issues are to them.
Materiality assessments
natural assets in their role of providing natural resource inputs and environmental services for economic production.
natural capital
A business approach in which a company puts back more into society, the environment and the global economy than it takes out.
net positive
What are the four steps of the conservation mitigation hierarchy?
refrain, reduce, restore, renew
refrain example (conservation)
e.g. mitigation: retain important biodiversity in development sites
e.g. conservation: proactively protect nature sites
Reduce example (conservation)
e.g. mitigation: best practices for industries to produce
e.g. conservation: proactive forest/indigenous peoples protection
Restore example (conservation)
e.g. mitigation: replanting and restocking areas
e.g. conservation: restore degraded areas of production
what sector is going through the largest increase in energy use?
consumption-sector
circular economy charactersitics
- non linear supply chain
- output of one process is the input of another
- resources not exploited or wasted
- dougnut economics: planetary boundaries