Sustainability Economic Theory
Classical Western-culture/values-based economic theory is not providing the models and policy prescriptions that are needed to stave off what appears to be a foreseeable collision in the next several decades between economic consumption expectations and desires in the developing world versus the dwindling resources available to satisfy them, and concurrently provide adequately for the future.
We propose the development of a new branch of economic theory, called Sustainability Economic Theory which expressly models and provides for:
- inclusion of externalized costs
- boundary conditions and resource limits
- impacts on other species
- appropriate discount rates for valuing the future environment and quality of life
- sustainable harvesting of renewable resources
- recyling and re-use of non-renewable resources
The development of Sustainability Economic Theory will provide the foundation for policy solutions, such as incentives (eg investment credits, cap and trade), pricing mechanisms (eg carbon tax) and regulations (eg limits on rainforest destruction, or species protections and reserves) that will help move the global economic system to a sustainable and equitable equilibrium.