You might want to read: Ecological Economics: Principles And Applications. This is Ecological Economics 101 and gives you a good grounding in the topic.
The authors describe ecological economics as “the union of economics and ecology.”
That sums it up pretty nicely. Ecological economics is filling the gap left by an economics discipline that largely ignores the impacts our economies have on the natural world. I've written recently about doughnut economics, which is an attempt to ingrain the ecological ceiling of our planetary boundaries and social foundation minimums into our economic thinking. I've also written on the production function and its glaring omission of energy and externalities in our understanding of how economics works.
You should probably also check out the International Society for Ecological Economics, and their influential journal, Ecological Economics.
One of the fundamental tenets of ecological economics, and a fact that seems obvious to most people, once you stop to think about it, is that the economy is a subsystem of the environment.
Economics has historically told us that it is labor and capital that drives our economy. You can't look at this diagram and say that with a straight face.
Ecological Economics vs. Classical Economics.
The economy is within society, and both the economy and society are within our environment. The environment and society provide the economy with all the resources and the workers it needs, and if the economy destroys that society or that environment, it destroys itself.
That's quite simple to understand, or at least it should be.
The environment isn't something “over there”, separate from the economy that we can borrow from forever. We can’t just use up one environment and then find another one to take its place and use those resources. We live in that environment, so any harm our economy does, we do to ourselves.
Classical economics ignores the need for a functional environment that sustains us. In classical economics, an economy can grow more and more profitable, and prosperous, seemingly forever. Ecological economics sets environmental boundaries and seeks levels of output that will satisfy the needs of a society and see that is adequate. Forever growing GDP isn't seen as a realistic possibility in an ecological economics context because we live on a planet with very real resource limits.
It's important to realize that ecological economics also sets out multiple goals for an economy. These goals are where the needs of the environment, society, and the economy can all act in harmony. An economy that slowly destroys the environment in which it lives, can be a booming success in neoclassical economic thinking. But this is a tragedy under ecological economics because an economy that uses up its environment will eventually destroy itself and society and the environment.
Don’t get confused.
If you start looking into ecological economics, you might find plenty of information on environmental economics. Sometimes these terms are used interchangeably, but historically they have meant two very different things. Ecological economics prioritizes the environment first and foremost. And the economy is limited by the laws of thermodynamics and the laws of nature. It is a discipline in which economics must obey the very real limits of our environment.
Environmental economics still tends to have neoclassical economics as its base. Environmental issues are important, but the natural economy must be governed by the laws of a market system. Environmental economics tends to attempt to put a price on nature. This is better than not valuing nature at all of course, but some would argue the concept of the commons, or common things that we all enjoy that can't be priced.
What price do you put on clean air or clean water? In an ideal world, we don't put a price on these at all. In the best-case scenario, we can take for granted that our air and water are free for us to use and are expected to be clean. Someone asking what value you put on clean air and water sounds like the beginning of a racket where someone fouls the air and the water, so they can sell us the means of cleaning it up.
You should know what you're getting into when these terms are used. In a quick search of university-level programs on ecological economics, my trusty search engines tended to bring back to me programs on environmental economics.
I'm not surprised by this because historically environmental economics is more friendly to neoclassical economics. Environmental economics generally wants to make sure we put a price on nature so we use it judiciously, but often shies away from limits on nature use, which is a founding principle of ecological economics.
If you're looking to get into ecological economics or learn more about it, make sure that's what you're getting.
Thanks Jack. I haven't read that Peter Victor book. I have read "Escape from Overshoot", but not that one. Looks like I'll have to give Peter more of my money.
Yes, almost all the principles and policies in the degrowth movement can be found in ecological economics, a very well thought out and comprehensive reformulation of basic economic theory - rooting it in both ecology and ethics - both of which are totally absent in mainstream economics. The Daly Farley textbook is a very good one. Another excellent book is by Peter Victor," Herman Daly's Economics for a Full World." It is less of a textbook and more a summary of Daly's writing over 60 yrs. It covers the importance of both an ecological and moral perspective for economics, as well as a summary of arguments why continued growth is not necessary, and the policies and programs that could lead to a steady state economy - the goal of degrowth. Its a handy reference for anyone active in the degrowth movement.