Green Economics and. Green Consumerism

Transcription

1 Green Economics and Green Consumerism

2 The capitalist economy is based on economic liberalism This is parallel to political liberalism and draws on many of the same tenets: individualism, self-interest, preferences, free will, property rights, contracts, etc.

3 Profit is a critical motivating factor in the functioning of capitalism Without the possibility of profit and accumulation, individuals will not strive to produce more than needed for subsistence and there would be little innovation and only limited production or, so goes the common argument

4 Consequently, capitalism seeks to institutionalize scarcity to stimulate desire

5 Classically speaking, nature is regarded as a bundle of resources to be exploited for profit Depending on who owns the resource, rents and royalties may be paid, but profit is only realized through use in goods that can be sold in markets

6 For the most part, nature (resources) is treated as essentially free and there is no inherent penalty to its degradation, depletion or destruction For such outcomes to be avoided, nature must be properly valued and priced, so that its true cost is internalized in production

7 But the value of nature depends on a price established by supply and demand Since nature has no price, how can value be established?

8 Scarcity can be created via property rights! An example of this can be seen in the atmosphere: there is too much & it has no market value What do you pay for oxygen?

9 The problem, therefore, is that we need to find ways to place a value on, or impute a value, to nature There are a number of ways this might be done

10 We can ask people what they think the contingent value is of nature & environment The problem is that people are often not willing to pay up when they are actually asked to do so

11 We can impose taxes or fees on various forms of resource use (and give rebates to the poor) Taxes named as such are not favorably regarded, and their effect relies on price and demand elasticities. But people may be willing to absorb such added costs.

12 Another approach is to create property rights to pollute and then establish a market to trade in them Cap and trade creates property rights, which limit emissions, make permits scarce, and commodifies the right to pollute but does this lead to the right price?

13 Green consumerism relies on supply of environmentally-friendly goods to meet a demand for them If enough people demand and purchase such goods even if they are costly the market will provide them and, eventually, become green

14 Ecological modernization addresses the benefits of reducing waste through new technologies, and also reducing the costs of waste and disposal This might be achieved through regulation, economic incentives, or systemic changes in consumer demand

15 A variant of this is that high rates of economic growth generate technological innovations and make available surplus resources for environmental protection

16 All of these continue to rely on market mechanisms, in the view that interventions should not seek to radically change underlying incentives to consume

17 Yet another approach is corporate social responsibility This is based on self-regulating codes of conduct and practices, on the theory that Greening will reduce costs and attract environmentally-oriented consumers does it work?

18 But will any of them work? Can consumption be harnessed to save the Earth? What about the problem of consumer choice?

19 Contrast market-based approaches with more radical & critical analyses The treadmill of production continues to consume resources and produce pollution, no matter how it is reformed, and because of economic growth The second contradiction of capitalism, according to Jim O Connor involves rising prices as nature and resources are exploited and degraded, undermining the productive basis of the system Provision of alternative forms of market-based commodities (e.g., through ecotourism) in place of resource extraction imposes other forms of exploitation and relies on low-wage service workers Capitalism cannot be reformed and must be replaced by an alternative system of production and reproduction But what would it look like?