Accidentally I stumbled upon a disparity between the definition of Harberger’s triangle or deadweight loss as it is employed in a Dutch textbook I consulted as opposed to the way it is employed in my son’s A-level textbook or the IB textbook in our possession.
Last weekend I watched an online lecture with the title “How We Got Addicted to Cars” brought by the University of Utrecht. The lecturer was the economist Julia Steinberger, Professor of Social Ecology and Ecological Economics at the University of Leeds.
I took something away from this lecture, that is much more profound to me than our addiction to cars, and very much in tune with the doughnut framework: The Systems of Provision Approach.
Last week I was fortunate to participate in the first game design session of a game based on Doughnut Economics, that has the working title Seeds. There are a few things I want to share with you about this project. Today I want to share some board game ideas I picked up in the meeting.
Recently I caught myself describing an industry in the old fashioned way. I focussed on the number of people employed in the industry, its contribution to GDP, and, in order to typify the market structure, I tried to find the most up to date information on market shares and company size.
But then it hit me: I was doing what I have always done, whereas we now need a different perspective on industries: a doughnut perspective.
One of the things we have discussed over the last few months is the concept of value. The question ‘what is value’ is such a philosophical question. It is often assumed that economists believe price to be equal to value, but if that was so, why would we have the concept of willingness to pay?
Alternative allocation has always been a fascinating concept to me. The insight that resources can be allocated in different ways is central to the fundamental theme of economics: choice. I used to think that economic choice was equivalent to the concept of economic scarcity. However, discussing allocation systems made me realise that this may not be that obvious.
A few days ago it was pointed out to us that the doughnut was not a model but a normative framework. Since we believe it is extremely important to teach young people the difference between normative and positive statements, this is an important insight. Therefore, it will not surprise you that we are very much aware of this. This is actually the reason why we prefer to say a 21st century economics education should be based on the doughnut framework.
Last week, the question was raised if the Equation of Exchange could be part of a 21st century economics education. Since I learned this equation when I was at school, you could ask yourself if it is not outdated. The equation, however, is of a simplicity that allows for many lessons about the economy. So, I would say: “Why not?”.
We teach our students that absolute advantage is an important driver of international trade. With the ecological ceiling in mind, we might need to revisit this concept to make it 21st century proof.
As part of the research I did when writing my post on ecological protectionism, I read a report of the Boston Consulting Group (BCG) on the EU carbon tax. This report introduced the interesting concept of the ‘profit pool’.