In the Dutch specification of the subject of economics, we have identified the concept of ‘exchange over time’. This concept is used to designate transactions where we exchange future consumption with current consumption, which is what we do when we take out a loan to buy for example consumer goods, or the other way around, which is what we do when we save up money. How can we apply this concept in a broader sense?
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 Since I learned this equation when I was at school, you could ask yourself if it is not outdated.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?”.
When writing lessons it is often difficult to decide on how to present the content.
You may have wondered why I did not include some current examples in the nitrogen cycle lesson. And if you did not wonder it then, you may have wondered why I left dead zones, acid rain, air pollution and climate change out when I discussed human interference in my previous post. Let me tackle both.
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’.
When we want to stay in the doughnut, we need to mitigate climate change and the overshoot in the other eight elements of the ecological ceiling. Countries can take measures by themselves, but when others do not put in the same effort, this is likely not enough.
One of the questions we have asked ourselves is: “Does a 21st century economics education based on the doughnut framework change the concept of economic scarcity?”
Basic financial, literacy skills grow resilience. Students learn what they need to function in the society they are part of, what is available in terms of social security, national healthcare and such. They also become aware of risks and uncertainties and how to cope with both – what precautions they can take and how to provide for themselves.
If you follow our posts, you are aware that the last post was about the nitrogen cycle. More specifically: what should a lesson on the nitrogen cycle look like? The question before that was if the biogeochemical cycles should be part of a 21st century economics education. I gave some reasons why I believe they…
