ECOLOGICAL ECONOMIC THEORY
Wednesdays, 9:00-12:00
Instructor Professor
Joshua Farley
Office
205
B Morrill Hall
Phone 656-2989
E-Mail jfarley@uvm.edu
Office Hrs TBA
Economics is frequently defined as the study of the allocation of scarce resources among alternative desirable ends, within and between generations: how we balance what is physically and ecologically possible with what is morally, socially and psychologically desirable. Economics should be based on the best available science from across the disciplines, but must ultimately be driven by normative values.
This course introduces ecological economics as a transdisciplinary field dedicated to solving pressing economic, social, and environmental problems. Ecological economics assesses the desirable ends of economic activity (a normative question), the nature of the available resources required to achieve those ends, existing institutions, and our knowledge of human behavior before deciding how to allocate. The most widely accepted desirable endin conventional economics is the satisfaction of subjective preferences through market allocation[1], which boils down to the maximization of monetary value. The desirable ends in ecological economics emphasize sustainability, justice, and a satisfactory quality of life for this and future generations of humans and other species. Ecological economics also differs from conventional economics in assuming that the economic system is embedded in a social system, which in turn is embedded in a finite global ecosystem. The economy is a physical system subject to the laws of both physics and ecology. The global ecological-economic system is highly complex adaptive system, non-linear and continually evolving. Simple answers to difficult questions rarely exist, and answers that were correct in the past may no longer be correct today.
The scientific method is based on falsification: one can never prove a theory to be true, but if empirical evidence contradicts a theory, then it can be proven false. Many ecological economists adhere to the philosophical tradition of pragmatism, which extends empirical testing to normative values. For example, many economists argue that individual choice (typically as expressed in the market) should drive all economic decisions, but ecological economists assert that this normative value should be tested in light of the results it generates. Pragmatism also holds that the goal of good theory to generate accurate predictions and acceptable solutions to real life problems rather than prioritizing an accurate representation of reality. We will use current events to ÔtestÕ both positive theory and normative values.
1.
Construct the pre-analytic vision of ecological economics
2.
Formulate a whole systems approach to ecosystem structure and
function.
3.
Formulate a whole system approach to the human subsystem
structure and function.
4.
Evaluate and design policy tools based on ecological
economic principles.
5.
Explore possible future paths for ecological economics
6.
Construct a web site to facilitate the teaching and learning of
ecological economics
7.
Develop peer
mentoring relationships and connections to the Gund Institute learning
community.
The class is organized as a
graduate student seminar, with weekly readings and discussion, group and
individual presentations, and work on teaching/learning modules for an
ecological economics website. The class is designed to be very interactive,
with lots of good discussion, and depends entirely on your active engagement. When you fail to do the readings and
come to class unprepared, you let down the entire class. Each class will focus on a major theme in
ecological economics. For each
theme I have selected at least two articles or chapters, with an emphasis on
leading ecological economists.
During the first hour of class I will present the overall theme and lead
discussion. During the second hour
of class, two different students will present important papers (one each, or
two jointly) and lead discussion.
Two days prior to each class, all students will submit discussion points
based on that weekÕs topic and readings. This means that all readings must be done
in advance. I will select particularly
good discussion points, and those students who submitted them will lead
discussion for the final hour. Throughout the semester, I will expect
students to keep up on current events, and integrate those relevant to the
weekÕs material into the discussions. We will treat current events as empirical
tests of the theories presented.
Our major project will be to
develop web based modules based on each class topic. Conventional economics
textbooks typically have accompanying websites that provide professors with all
the material needed to easily deliver a course, but there is little of
this nature available in ecological economics. Student groups will therefore
build detailed modules that provide reading materials, lecture notes and
slide presentations, exercises and assignments, evaluation materials, and
any other material required to effectively deliver a course or facilitate
self-learning. Among other options,
we could ask ecological economists from around the world to develop teaching
modules based on their own work, perhaps a specific paper. We could design the site to allow
users to review the modules and creators to modify the modules in response in
an interactive peer review process.
The International Society for Ecological Economics will host the
website, which will likely be mirrored on the Gund site as well. I have draft modules for many topics
that you can improve upon. There
will be due dates for different components of the modules over the course of
the semester. In lieu of any exams,
you will be required to write an editorial relating course topics to current
events, and submit it for publication.
Those students who are published will receive an automatic 100%.
This class will be more
logistically difficult than most.
UVM students will meet in the Gund conference room, and McGill and York
students in a room on their own campuses connected via interactive video
networking. While we have done a
trial run, we will likely need to work out some bugs as we go. Another challenge is that McGill, UVM
and York have slightly different schedules, so a couple of classes will be
asynchronous.
UVM Students will be
evaluated based on their overall class participation (10%), paper presentation
(10%), discussion points submitted (10%), leading class discussion (10%), editorials
(15%) and the final modules they produce (45%). The courses will be listed separately at
McGill and York, and the professors of record will likely do the grading. I will provide my comments on
participation and presentations, but the McGill and York professors may grade
somewhat differently.
For UVM students, this course
serves as a gateway to the Certificate of Graduate Study in Ecological
Economics. The EE Certificate is a 15-credit
program, including 3 core classes and 2 electives. The core classes include
this theory course, plus Ecological
Economic Methods (previously Dynamic Systems Modeling) and Ecological Economic
Practice (also known as Gund ateliers).
Candidates for the EE Certificate also have to demonstrate graduate-level
experience across four competencies in natural sciences, social sciences,
management, and quantitative methods. This can be done with courses (usually at
least the 2 electives are used), but also previous graduate classes and life
experience. Note that the Graduate College will only allow 6 credits to be
transferred into the 15-credit program (including earned or currently enrolled
UVM credits). Admission into the EE Certificate program is separate from
admission into an MS or PhD program at UVM, requiring an additional (short) application.
The course will help initiate
a UVM, McGill, York University collaboration on a program in Education in
the Anthropocene. Basically, our goal is to create a transdisciplinary
PhD program in ecological economics, broadly defined. Each year's cohort
of students will focus on a specific transboundary ecological-economic problem.
The first yearÕs cohort will focus on problems affecting Lake Champlain
This is a graduate seminar,
so readings will evolve as the course progresses. Students will be expected to
identify articles and lead discussions every week. One goal of this course is to introduce
many of the leading scholars in ecological economics, which accounts for the
diversity of authors we will read, though not all authors would consider
themselves ecological economists. The
readings on the syllabus represent a "learning core" from which other
reading assignments will emerge. Readings will be made available as PDFs on a
course web site, and initially will include (roughly in the order we read them):
Costanza,
R., 1989. What is ecological economics? Ecological Economics 1, 1-7.
Faber, M.,
2008. How to be an ecological economist. Ecological Economics 66, 1-7.
Costanza,
R., Daly, H.E., Bartholomew, J.A., 1991. Goals, agenda, and policy recommendations for
ecological economics, in: Costanza,
R. (Ed.), Ecological Economics: The Science And Management Of Sustainability.
Columbia University Press, New York, pp. 1-20
Daly, H.E.,
1992. Allocation, distribution, and scale: towards an economics that is
efficient, just, and sustainable. Ecological Economics 6, 185-193.
Georgescu-Roegen,
N., 1975. Energy and Economic Myths. Southern Economic Journal 41, 347-381
Norgaard,
R.B., 2010. Ecosystem services: From eye-opening metaphor to complexity
blinder. Ecological Economics 69, 1219-1227.
Rees, W.,
2013. Denying Herman Daly: Why Conventional Economics Will not Embrace the Daly
Vision, in: Farley, J., Malghan, D. (Eds.), Beyond uneconomic growth. Island
Press, Washington, DC
Gintis, H.,
2000. Beyond Homo economicus: evidence from experimental economics. Ecological
Economics 35, 311-322.
Bromley,
D.W., "The Ideology of Efficiency: Searching for a Theory of Policy
Analysis," Journal of Environmental Economics and Management 19: 86-107,
1990.
Stigler,
G.J., Becker, G.S., 1977. De Gustibus Non Est Disputandum. The American
Economic Review 67, 76-90.
Martinez-Alier,
J., Munda, G., O'Neill, J., 1998. Weak comparability of values as a foundation
for ecological economics. Ecological Economics 26, 277-286.
Gowdy, J.,
1997. The Value of Biodiversity: Markets, Society and Ecosystems. Land
Economics, 25-41.
Daly, H.E.,
"Introduction to the Steady-State Economy," in H.E. Daly (ed.),
Economy, Ecology, Ethics: Essays Toward a Steady-State Economy, W.H. Freeman
and Co., San Francisco, CA, 1980.
Farley, J.,
Burke, M., Flomenhoft, G., Kelly, B., Murray, D.F., Posner, S., Putnam, M.,
Scanlan, A., Witham, A., 2013. Monetary and Fiscal Policies for a Finite
Planet. Sustainability 5, 2802-2826.
Lawn, P.,
2010. Facilitating the transition to a steady-state economy: Some macroeconomic
fundamentals. Ecological Economics 69, 931-936.
Howarth,
R.B. 2011. ÒIntergenerational Justice.Ó In the Oxford Handbook on Climate
Change and Society (John S. Dryzek, Richard B. Norgaard, and D. Schlosberg,
editors). Oxford: Oxford University Press.
Saez, E.,
2013. Striking it Richer: The Evolution of Top Incomes in the United States
(Updated with 2011 estimates), University of California-Berkley working Paper,
University of California, Berkley. Available on-line:
http://emlab.berkeley.edu/~saez/saez-UStopincomes-2011.pdf. Accessed July 27, 2013.
Daly, H.,
Goodland, R., 1994. An ecological-economic assessment of deregulation of
international commerce under GATT. Ecological Economics 9, 73-92.
Brown, P., 2011.
The Unfinished Journey of Ecological Economics: Toward an Ethic of Ecological
Citizenship, in: Farley, J., Malghan, D. (Eds.), Beyond uneconomic growth.
Island Press, Washington, DC
Spash, C.L.,
2013. The shallow or the deep ecological economics movement? Ecological
Economics 93, 351-362.
Recommended:
Ropke, I.,
2004. The early history of modem ecological economics. Ecological Economics 50, 293-314.
Ropke, I.,
2005. Trends in the development of ecological economics from
the late 1980s to the early 2000s.
Ecological Economics 55, 262-290.
Daly, H. E. (1968). On Economics as a Life Science. Journal of Political Economy, 76(3), 392-406.
Gowdy, J., & Erickson, J. (2005). The approach of ecological economics. Cambridge Journal of Economics, 29(2), 207-222.
Hubbert,
M.K., 1993. Exponential Growth as a Transient Phenomena in Human History, in:
Daly, H., Townsend, K. (Eds.), Valuing the Earth: Economics, Ecology, Ethics.
MIT Press, Cambridge, pp. 113-125.
Rockstrom,
J., et al. 2009. A safe operating space for humanity. Nature 461, 472-475.
Steffen, W.,
Grinevald, J., Crutzen, P., McNeill, J., 2011. The Anthropocene: conceptual and
historical perspectives. Philosophical Transactions of the Royal Society A:
Mathematical, Physical and Engineering Sciences 369, 842-867
Vohs, K.D.,
Mead, N.L., Goode, M.R., 2006. The Psychological Consequences of Money. Science
314, 1154-1156.
Henrich, J.,
Boyd, R., Bowles, S., Camerer, C., Fehr, E., Gintis, H., McElreath, R., Alvard,
M., Barr, A., Ensminger, J., Henrich, N.S., Hill, K., Gil-White, F., Gurven,
M., Marlowe, F.W., Patton, J.Q., Tracer, D., 2005. "Economic man" in
cross-cultural perspective: Behavioral experiments in 15 small-scale societies.
Behavioral and Brain Sciences 28, 795-855.
Gowdy, J.M.,
2004. Altruism, evolution, and welfare economics. Journal of Economic Behavior
& Organization 53, 69-73.
Gowdy, J.M.,
Microeconomic Theory Old and New: a Student's Guide, Stanford University Press,
Stanford, CA, 2010, Chapters 1-3, 4
Gowdy, J.M.,
Microeconomic Theory Old and New: a Student's Guide, Stanford University Press,
Stanford, CA, 2010, chapter 5, 6-7
Farley, J.,
2010. Conservation Through the Economics Lens. Environmental Management 45,
26-38.
van den
Bergh, J.C.J.M., 2010. Externality or sustainability economics? Ecological
Economics 69, 2047-2052.
Farley, J.,
2008. The Role of Prices in Conserving Critical Natural Capital. Conservation
Biology 22, 1399-1408.
Daly, H.,
2013. A further critique of growth economics. Ecological Economics 88, 20-24.
Muradian,
R., Martinez-Alier, J., 2001. Trade and the environment: from a ÔSouthernÕ perspective.
Ecological Economics 36, 281-297.
Farley, J.,
2012. Ecosystem Services: The Economics Debate. Ecosystem Services 1, 40-49.
Spash, C.L.,
2012. New foundations for ecological economics. Ecological Economics 77, 36-47
Any breach of the Code of
Academic Integrity will be considered grounds for failure in the course. See:
http://www.uvm.edu/~uvmppg/ppg/student/acadintegrity.pdf. Collaboration on
homework and course projects is required; however everyone is expected to be an
equal partner. Copying or
free-riding on the sweat of others will be considered grounds for individually
failing assignments and/or the class.
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Aug. 28 |
Course intro |
Strongly recommended:
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Sept. 4 |
Pre-analytic vision and goals |
Recommended:
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Sept. 11 |
Resource base and Thermodynamics |
Recommended:
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Sept. 18 |
Human nature |
Recommended:
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Sept. 25 |
Microeconomics: What is efficiency? |
Recommended:
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Oct. 2 |
Microeconomics: Ômarket failuresÕ |
Recommended:
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Oct. 9 |
Microeconomics: The valuation debate |
Recommended: SPASH Costanza, R., d'Arge, R., Groot, R. d.,
Farber, S., Grasso, M., Hannon, B., . . . Belt, M. v. d. (1997). The
value of the world's ecosystem services and natural capital.
Nature(387), 253-260. Farley, J., 2008. The Role of Prices in Conserving Critical Natural Capital. Conservation Biology 22, 1399-1408. | |
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Oct. 16 |
Macroeconomics: goals and measurements; the steady state |
Daly, H.E., "Introduction to the Steady-State Economy," in H.E. Daly (ed.), Economy, Ecology, Ethics: Essays Toward a Steady-State Economy, W.H. Freeman and Co., San Francisco, CA, 1980. Bergh, J. C. J. M. v. d. (2009). "The GDP paradox." Journal of Economic Psychology 30(2): 117-135. Recommended: Victor, P. (2009). "Living Well: Explorations into the End of Growth." Center for Humans and Nature 5(2). Costanza, R., J. Erickson, K. Fligger, A.
Adams, C. Adams, B. Altschuler, S. Balter, B. Fisher, J. Hike, J.
Kelly, T. Kerr, M. McCauley, K. Montone, M. Rauch, K. Schmiedeskamp, D.
Saxton, L. Sparacino, W. Tusinski and L. Williams (2004). "Estimates of
the Genuine Progress Indicator (GPI) for Vermont, Chittenden County and
Burlington, from 1950 to 2000." Ecological Economics 51(1-2): 139-155. Center for the Advancement of the Steady State Economy (CASSE). See articles by Brian Czech, among others. Stiglitz, J. E., A. Sen, J.-P. Fitoussi and et al. (2009). Full report "Report by the Commission on the Measurement of Economic Performance and Social Progress." or Summary Daly, H., 2013. A further critique of growth economics. Ecological Economics 88, 20-24. | |
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Oct. 23 |
Macroeconomics: Money and finance |
Farley, J., Burke, M., Flomenhoft, G., Kelly, B., Murray, D.F., Posner, S., Putnam, M., Scanlan, A., Witham, A., 2013. Monetary and Fiscal Policies for a Finite Planet. Sustainability 5, 2802-2826. Lawn, P., 2010. Facilitating the transition to a steady-state economy: Some macroeconomic fundamentals. Ecological Economics 69, 931-936. Recommended:
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Oct. 30 |
Macroeconomics: Distributio |
Howarth, R.B. 2011. ÒIntergenerational Justice.Ó In the Oxford Handbook on Climate Change and Society (John S. Dryzek, Richard B. Norgaard, and D. Schlosberg, editors). Oxford: Oxford University Press. Saez, E., 2013. Striking it Richer: The Evolution of Top Incomes in the United States (Updated with 2011 estimates), University of California-Berkley working Paper, University of California, Berkley. Available on-line: http://emlab.berkeley.edu/~saez/saez-UStopincomes-2011.pdf. Accessed July 27, 2013. Recommended:Wilkinson and Pickett; Martinez-Alier | |
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Nov. 6 |
Macroeconomics: International trade and financial contagion |
Daly, H., Goodland, R., 1994. An ecological-economic assessment of deregulation of international commerce under GATT. Ecological Economics 9, 73-92. Muradian, R., Martinez-Alier, J., 2001. Trade and the environment: from a ÔSouthernÕ perspective. Ecological Economics 36, 281-297. | |
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Nov. 13 |
Policy design | Costanza,
R., F. Andrade, P. Antunes, M. v. d. Belt, D. Boersma, D. F. Boesch, F.
Catarino, S. Hanna, K. Limburg, B. Low, M. Molitor, G. Pereira, S.
Rayner, R. Santos, J. Wilson and M. Young (1998). "Principles for sustainable governance of the oceans." Science 281(198-199). Vatn, A. (2010). "An institutional analysis of payments for environmental services." Ecological Economics 69(6): 1245-1252. Recommended: Chapter 21 in Daly, H. E. and J. Farley (2010). Ecological Economics: Principles and Applications. Washington, DC, Island Press. Others TBA | |
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Nov. 20 |
Policy applications |
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Dec. 4 |
Future of EE |
Brown, P., 2011. The Unfinished Journey of Ecological Economics: Toward an Ethic of Ecological Citizenship, in: Farley, J., Malghan, D. (Eds.), Beyond uneconomic growth. Island Press, Washington, DC Spash, C.L., 2013. The shallow or the deep ecological economics movement? Ecological Economics 93, 351-362. Recommended: Spash, C.L., 2012. New foundations for ecological economics. Ecological Economics 77, 36-47. |
Additional authors to include: Peter Victor, Jon Erickson, Nicolas Kosoy, Arild Vatn, Cutler Cleveland
[1] Curiously, many conventional economists argue that economics is a positive science, while Ôdesirable endsÕ implies normative goals. They therefore argue that ends need not be desirable per se, and that the economy should try to satisfy individual preferences (weighted by purchasing power) regardless of the desirability of the consequences. However, this libertarian assumption merely defines ÔdesirableÕ as whatever the consumer prefers.