I have recently decided to continue writing this blog in German, under a new address: Skeptische Ökonomie. Feel free to follow the new blog. The Sceptical Economist will remain online, but it is unlikely that I will publish any new posts here.
“It’s a question of balance.” I guess, this might be the most often-used phrase on this blog. Today, again, I would like to write about an important balancing act that is not easy to achieve. Particularly so, as we have to achieve it (almost) everyday. It is the balance between being satisfied, on the one hand, and not being satisfied, on the other. Continue reading
Today’s less serious post will be about how much education and occupation determine how we see the world around us and how we describe it. Continue reading
A very interesting short documentary about the Yasuní rainforest can be viewed here. Unfortunately, I cannot embed it in the post, so you have to use the link.
Last year, it was the 27th of September. This year’s Earth Overshoot Day, however, is the 22nd of August. Even though the methodology of the Global Footprint Network and similar projects is not completely unproblematic, the main message is clear: we are (ab)using the Earth’s resources in a way that is extremely unsustainable.
Today, August 22, is Earth Overshoot Day, marking the date when humanity has exhausted nature’s budget for the year. We are now operating in overdraft. For the rest of the year, we will maintain our ecological deficit by drawing down local resource stocks and accumulating carbon dioxide in the atmosphere.
In last years, there were reasons to hope: Copenhagen, Durban, Rio +20, the election of Barack Obama for president of the United States, China’s seeming calming down in Cancún, progress in the EU… Still, the overall progress was terribly disappointing. We are still massively burning (and even subsidizing) fossil fuels, consumption levels still aren’t dropping in the developed world (while they are steeply rising in its developing parts), our agricultural systems remain, in spite of some progress toward agro-ecology, unsustainable (possibly because of most environmentalists’ sticking to the dogma of “bad biotechnology“)… Shortly, we, i.e. humanity as a whole, still apparently don’t care about our own and our children’s future. We prefer short-sightedness and short-term pleasure over reason and long-term survival. We prefer keeping our eyes closed and denying on what appears inconvenient to us, instead of facing the truth that we have to change. Indeed, the way we live will have to change anyway, as a result of the pressures we put over the Earth system. Wouldn’t it be easier to stop shooting at the Earth on our own, instead of waiting until lifestyle changes will become inevitable?
Greenpeace, Friends of the Earth, WWF and numerous other environmentalist organizations have been long pressing for a committed global effort to tackle climate change. It is clear that the major issue here is energy production – we desperately need low-carbon energy to keep the Earth’s climatic system in balance. However, these environmentalists also fight nuclear power, one of the two established low-carbon technologies in energy production (the other being hydropower) that are the only ones so gar that provide baseload electricity. At the same time, Greenpeace & Co. have long dismissed the idea (or, rather, ideology) called Cornucopianism which states that human ingenuity and free markets will provide solutions to every challenge humanity shall ever encounter – so we don’t have to worry about climate change, acid rain, the ozone hole, overpopulation, dwindling resources etc. – there will always be a backstop technology to save us. Continue reading
Readers and visitors may have noticed that my general view of humanity’s environmental, social and related problems is that no real solution can be achieved without widespread acceptance that we must change. We must change the way we are living, the way we are consuming, housing, travelling, communicating etc. Prolonging the status quo of attitudes, values and life styles will only provide half-baked solutions. However, I recently have been thinking about this (I still am) and I realized that the problem is even deeper than I had thought in the first place. Continue reading
The process of societal change – in attitudes, institutions, values, relationship patterns etc. – is accelerating steadily in modern societies. Their members are losing their ability to accommodate to these changes. Furthermore, since our basic needs are fulfilled, we engage more and more in competition for goods that some can have – but not all at the same time, not without serious quality deterioration at least. Moreover, we are working much to be able to pay for consumer goods that we cannot really consume because our time budget does not allow for it any more. This does not stop us from desiring even more consumer foods and from uselessly working to earn the money we need to pay for them. At the same time, whereas GDP has been growing continuously (with only minor periods of regress) for years, the satisfaction we draw from our lives has been at best stable in that time, since our aspirations change as fast as the economy (and our incomes) grows. Last but not least, this growth in production and consumption, as well as population, has led to a terrible, unsustainable level of use of Nature’s resources and services, which can in effect lead to a break down of the world economy.
What do these insights have in common? They were all made some 40 years ago, and little seems to have changed to the better – rather the contrary. Continue reading
For better and easier navigation, I created a sub-page “Economics of Climate Change” (see the above menu) where I am going to put my posts on this subject grouped into some rough categories: economic climate modelling, energy generation, mitigation and adaptation, climate science & denialism, burden sharing, climate policy (further reading will be updated soon). Within categories, posts are ordered by date. Feel free to browse it.
It is an interesting thing that what is commonly called the antiglobalist movement (by the media as well as by those involved themselves) is probably the best interconnected – one may say, globalized – movement in the world. The spread of Occupy Wall Street to Europe is a most recent example. In this context, two question may well be asked: is it right to call that movement anti-globalist? And what does it represent? What are the grounds such an interconnected movement has emerged? The latter questions must be answered first, before we can turn to the former one. Continue reading
Today this blog is going to turn a year old. I take this as an opportunity to provide a list of books that have influenced what I am writing here most. You can also see this as a kind of a special edition of my recently launched “Weekly Reading Recommendations”. Continue reading
Today, September 27th, is the symbolic day when humanity used all resources it could sustainably use this year – the Earth Overshoot Day. Since the year is not over, we seem to actually need about 1,5 Earths, so to speak.
Who is the founder of Keynesian economics? Of course, it is John Maynard Keynes. And when did his theory see the light of day? In 1936, of course, when Keynes published his main work, “The General Theory of Employment, Interest and Money”. Rooted in the experiences of the Great Depression, Keynesianism has called for deep engagement of the State in economic activity, mainly through fiscal policy (i.e., government spending). The goal should be (and this is what politicians who claim to be Keynesians often forget about) to smooth business cycles – spending in times of busts, but saving during booms. All this should be known to everybody who has at least a slight idea about the history of economics. But I bet that not many know that Keynes’s theory was not new when he published it. It was new to him, and it was new to the biggest part of the public – but there had been somebody who had developed a highly similar theory a few years earlier. Continue reading
Jeffrey Sachs belongs to the economists who have influenced my thinking deeply. So I was very positively surprised when I read his new article, “Need Versus Greed”, yesterday.
Sachs is one of the most distinguished development economists, Director of the Earth Institute at Columbia University and Special Adviser to United Nations Secretary-General on the Millennium Development Goals. His last book, “Common Wealth”, is a highly interesting contribution to development economics. Nonetheless, I always thought of him as a good, but still “mainstream” economist who considers economic growth the solution of all problems (why I don’t share this opinion, you can read here). With the article named above he proved me wrong.
Our planet will not physically support this exponential economic growth if we let greed take the upper hand. Even today, the weight of the world economy is already crushing nature, rapidly depleting the supplies of fossil-fuel energy resources that nature created over millions of years, while the resulting climate change has led to massive instabilities in terms of rainfall, temperature, and extreme storms.
It sounds just like what I would expect from the economics of development. And the whole article is perhaps not a new “discovery of America”, but certainly a piece worth reading.
As I already once have mentioned, a great challenge for the development aid efforts is to create incentives for the pharmaceutical corporations to research on medicines that are really needed. Unfortunately, most of the pharmaceutical products developed are cosmetics. According to the WHO, only less than 1% of what is being developed are medicines against tropical diseases. But there are millions of people in the developing world dying and suffering from AIDS, tuberculosis, malaria etc. Either there are no new, potent medicines against these diseases, or, if there are (as in the case of AIDS), they are too costly due to patent rights.
But there are initiatives with the aim to change that. One of them is the Health Impact Fund project. Continue reading
Yesterday there was another terrorist attack in Moskow. This time it hit the Domodedovo airport. 35 people died, after a suicide bomber pulled the detonator. (It is not the actual subject of this blog, but since I have my bachelor in Russian studies, I have some special interest for Russian affairs.) Continue reading
According to this article in the Polish Gazeta Wyborcza, the case of fighting global warming has another prominent supporter – Tenzing Gyatso, the 14. Dalai Lama. He is told to have explained an American diplomat that while Tibet’s independence from China can wait, climate change won’t. Continue reading
In his last article at Project Syndicate Dani Rodrik is “thinking about the unthinkable” – does the eurozone have a future, at least in the current form and with its current members? After the bailouts of Greece and Ireland (and the looming ones of Spain, Portugal and Italy) it is a question that surely should be considered. Continue reading