Kate Raworth's Blog, page 3

Spring. Renewal. Bring on Regenerative Economics.

Easter Sunday. It’s Spring, time for renewal, rebirth. There couldn’t be a better day in the year for launching the latest fabulous one-minute animation of Doughnut Economics – because this one is about regenerative economic design.

For over 200 years, industry has been based on degenerative design: we take Earth’s materials, make them into stuff we want, use it for a while, then throw it away. It’s a one-way system that runs against Earth’s cyclical processes of life. And it is destroying the planet’s living systems on which we fundamentally depend.

Contrary to the promises of late-20th century economic theory, economic growth won’t simply clean up the mess it makes. Which is why we have to make our economies regenerative by design, so that they use Earth’s materials again and again. Figuring out how to do so is one of the greatest design challenges for 21st century architects, industrialists, entrepreneurs, financiers, citizens and states to take on.

Here’s the story in just a minute, animated by the brilliant, BAFTA-winning animator Ainslie Henderson. I discovered his work while browsing on line and so quickly beat a path to his digital door, begging him to work with me to tell the story of new economics. I’m so delighted that he was up for the challenge because I think the resulting video is deeply inspired and inspiring – I hope you agree.

Doughnut Economics is out!

It’s been quarter a century in the making – ever since the day I stepped into my first university Economics lecture back in 1990 – but Doughnut Economics: seven ways to think like a 21st century economist is now out (well, it’s officially published tomorrow, 6 April, but it’s been spotted in bookshops from London to New York to Hong Kong to Singapore, so I call that out…).

Here’s the book trailer, just to whet your appetite.

And if you want the low-down on the core messages of Doughnut Economics – those seven ways to think – then they are set out here in my brand new blog for Open Democracy.

If you’d like to help make the book fly, please do post about it on Twitter and Facebook, write a review on Amazon, and give a copy of the book to any unsuspecting economics student you know under the age of 95.

Doughnut Economics is available at all good bookshops, published in the UK by Penguin Random House and in the US by Chelsea Green. If you read it, do let me know what you think: this is a conversation and it’s only just beginning. Here’s to rewriting, and redrawing, economics.

Why degrowth has outgrown its own name

Here’s what troubles me about degrowth: I just can’t bring myself to use the word. And with the help of smoke bombs, elephants and lighthouses, I can explain why.

Check out the five reasons why I think degrowth needs a new name in my on Duncan Green’s Poverty to Power blog.

Giorgos Kallis, one of the leading thinkers in the degrowth movement, will reply tomorrow. But since there are, no doubt, many views on this, it would be great to hear them – so please do leave a  too.

You can read the .

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Do you dare to doughnut in Davos?

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It’s Davos time and the roundtable discussions are getting underway. So here’s the ultimate roundtable that I invite – or dare – every Davos CEO to take a seat at and tell their company’s story.

The table is the Doughnut – the safe and just space for humanity – which lies between the planetary boundaries of Johan Rockstrom and his fellow scientists and the social boundaries that I crowd-sourced from the world’s governments at Rio+20. Between those two sets of boundaries is no less than humanity’s goal for the 21st century: to meet the human rights of up to 10 billion people while safeguarding the planetary life-support systems that sustain us all.

Here’s how the CEO Doughnut Dialogues work. Every CEO – whether selling sun tan lotion or solar panels, seeds or tweeds, cars or bras – is invited to take a seat at the table and put their company’s products at its centre. And then tell the story of those products – all the way from their design, sourcing, supply and sale to use and disposal – in terms of whether or not they are helping to bring humanity into the safe and just space between social and planetary boundaries.

The real question on the table, as put snappily by a leading London brand agency: Is your brand a Doughnut brand – or on its way to becoming one?

There’ll be plenty to talk about, starting with your business today.

– Of all the nine planetary boundaries, which are the boundaries that your company’s business and business model is really putting pressure on? (Intensive use of water? Driving large-scale land-use change? Heavy reliance on fossil fuels? Generating plastic or chemical waste?) And are there any boundaries for which your products are helping to reduce that pressure (Renewable energy technology, water-efficient household goods?)

– Of the eleven social boundaries, which ones does your business model have most impact on? (Are the women and men who make the products paid a living wage, and free to organise? What is the  impact on consumers’ health and nutrition from consuming it?)

– Next, tell the story of your products’ evolving social and environmental impact over the past ten years. How has your company improved its business practices over the last decade so that it has more positive impacts on the social dimensions, and simultaneously reduced pressure on planetary boundaries? Where, in contrast, have been the social and environmental steps backwards, pushing the products further out of the safe and just space.

– And then, importantly, tell the story of your company’s ambition over the coming ten years. In which dimensions could your company make transformative change both in improving its social impact and in reducing its ecological impact?

I can think of several companies that could proudly put their products on the doughnut table and tell an impressive story of the progress they have made, with an open and honest assessment of how far they still have to go. And I can think of plenty of other companies that would steer well clear and avoid a seat at all because the doughnut challenge would starkly reveal the extent to which their business model is operating outside of the boundaries on both sides.

Can this kind of visual exercise help drive commitment and action within companies? Yes. It is one of the core workshop tools we use at the Cambridge Institute for Sustainability Leadership, when working with senior executives from a wide range of multinational companies. In those workshops we explore not only how companies may be raising the pressure on social and planetary boundaries, but also how greater global pressure on those boundaries, in return, raises risks for your own business. And a number of leaders among those companies have taken up the Doughnut as part of their in-house strategising.

So, come on Davos CEOs, who’s up for a Doughnut Dialogue?…

Madonna in distress: the new planetary portrait

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Madonna Litta, Leonardo da Vinci

Mother Earth has a never-before-seen portrait now on show, thanks to three pieces of planetary-scale research published this week.

Together they paint the most up-to-date image yet of our planetary home – along with the extreme demands that we, her most demanding offspring, are making of her.

So what does this most modern of mother-and-child portraits look like?

In one way, it’s a twist on Leonardo’s Madonna Litta, with its knowing baby gorging himself on his mother’s milk. But in the new planetary version of this image, the infant’s excessive demands have left Mother Earth far from serene.

So here’s that scientific portrait, in three broad brush strokes.

The dominant child. We humans became the biggest driving force of Earth-system change back around 1950. Just as Bing Crosby and Nat King Cole topped the music charts, we were entering the Anthropocene – the epoch of Earth’s history in which humanity is the biggest driver of change at the Earth-system scale. Why around then? According to the team of experts brought together to propose the date, it’s the arrival of carbon isotopes from nuclear weapons, along with a thin layer of plastic litter on Earth’ s surface at that time which should mark the defining shift. So we’re likely to go down in history as the ones who smeared the planet with nuclear fallout and plastic debris: that is unlikely to impress far-future generations.

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Hiroshima, 6 August 1945. The Anthropocene had begun.

2. Growing pains. Since 1950 we have driven a Great Acceleration in our consumption of Earth’s resources, with accompanying ecological impact. Research by Will Steffen and colleagues has documented the unprecedented exponential increase in human consumption that kicked off around 1950 – from international flights, cars and energy to paper, water and fertilizer – along with a rapid increase in ecological degradation, from tropical forest loss to ocean acidification. “It is difficult to overestimate the scale and speed of change”, says Steffen, “In a single lifetime, humanity has become a planetary-scale geological force.”

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Out of our mother’s arms. Thanks to this intense pressure on the planet, we have now crossed beyond the safety zones of four planetary boundaries. A just-released update of the planetary boundaries framework by Will Steffen, Johan Rockstrom and colleagues – six years on from its initial publication – indicates that we have pushed ourselves over the boundary on climate change, biosphere integrity, land-system change, and phosphorus and nitrogen use, putting ourselves beyond a Holocene-like planetary state and hence into a danger zone. “Transgressing a boundary”, says lead author Steffen, “increases the risk that human activities could inadvertently drive the Earth System into a much less hospitable state, damaging efforts to reduce poverty and leading to a deterioration of human wellbeing in many parts of the world, including wealthy countries.”

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There is already critique of the new planetary boundary analysis, put forward by some of its long-standing critics associated with the Breakthrough Institute (but this should hardly be a surprise: what else was going to happen when the Breakthrough Gang bumped into the Boundary Gang?). The Breakthrough authors, Erle Ellis and colleagues, argue that, “Contrary to the authors’ claim that the Holocene is the ‘only state of the planet that we know for certain can support contemporary human societies’, the human-altered ecosystems of the Anthropocene represent the only state of the planet that we know for certain can support contemporary civilization.”

It’s a challenge that risks pitching a false battle over who makes the best mum to 21st century humanity: the Holocene or the Anthropocene? I’d say neither of those two mothers, as they are defined.

This century we should be seeking to create a world in which we can collectively provide the food, water, energy, shelter, and other essential needs to meet the human rights of up to 10 billion people, and do so without disrupting the planetary life-support systems – a stable climate, fertile soils, thriving biodiversity, ample freshwater, a protective ozone layer – on which our well-being also depends.

That world lies in neither a pristine Holocene nor a boundary-busting Anthropocene. Rather, it is to be found in the uneasy lovechild of the two. And that’s the doughnut: the space that lies between social boundaries and planetary boundaries.

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The Doughnut: lovechild of the Holocene and the Anthropocene, Raworth (2012)

Why the doughnut? Because we have to put some pressure on the planet to meet our human rights – but not so much that we undermine the very life-support systems that Earth provides. It’s a question of balancing skillfully in the space that lies between these two fundamental sources of our wellbeing.

And since it is all about balance, then perhaps this image makes a more aspirational and suitable Madonna-and-child portrait for the 21st century. Don’t be fooled, though: this balancing act will be far from easy to achieve and maintain, so we have a good way to go before we can start smiling about it.

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Image: John Slater

Why it’s time for Doughnut Economics: from TEDx Athens

Want to help rewrite economics? Then here’s the guerrilla campaign for you – set out in my newly posted TEDx Athens talk on Why it’s time for Doughnut Economics.

There’s one diagram at the heart of economic teaching and thinking which gets embedded in the back of the head of every economics student and sets economic policymaking off on the wrong foot. It’s ripe for updating.

It’s also time we realised that ours is the era of the planetary household – and we need an economic mindset equipped for taking on its challenges. And that’s why it’s time for Doughnut Economics, which puts human rights and ecological integrity at the heart of a 21st century vision of economic development.

In November I talked about these ideas at TEDx Athens, and gave a crash course in economics with a twist – showing in three minutes what they never tell you in three years of a degree. Check it out, and let me know what else needs to be changed in that diagram….

Don’t let the Anthropocene become the Manthropocene.

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Have we have entered the Anthropocene – the planetary era that is dominated by the environmental impacts of human activity?

Ironically, the scientists deciding this important question seem to have overlooked the fact that their own deliberations are dominated by white Northern male opinion.

The Anthropocene is at risk of becoming the Manthropocene (and – come to mention it – the Northropocene, too).

What’s wrong with that? Read my full article on The Guardian’s Comment Is Free site.

Want to get into the doughnut? Tackle inequality

Humanity’s central challenge in the 21st century is to meet the human rights of all people within the capacity of Earth’s life-support systems. In other words, we need to get into the doughnut: the safe and just sweet spot between social and planetary boundaries (Fig. 1).

Fig. 1: The Doughnut: humanity’s sweet spot

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So where are we today? Beyond the boundaries on both sides: we have already transgressed at least three planetary boundaries (on climate change, nitrogen use and biodiversity loss), while over one billion people still lack the means to meet their most essential needs (Fig. 2).

Fig. 2: Beyond the boundaries on both sides:

over the environmental ceiling – and under the social foundation

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What will it take to get into the doughnut? Tackling inequality is key – and that means addressing resource inequalities in both consumption and production. Here’s why, in three messages.

Getting over the social foundation demands redistributing resource consumption towards the worst off. The good news? This need not be a source of pressure on the planet, as shown in Fig. 3.


13% of people currently don’t have enough food to eat, according to the FAO. What would it take to meet their needs? Around 3% of today’s global food supply. Meanwhile, between 30% and 50% of that global food supply is lost post-harvest, wasted in the supply chain, or thrown away in our kitchens. Ending hunger would take just 10% of the food that is not even being eaten.


 19% of people have no access to electricity. According to the International Energy Agency, their basic electricity needs could be met, using a mix of generating sources, with just a 1% increase in global CO2 emissions. That’s fantastic news because it means tackling climate change and ending energy poverty are essentially separate challenges.


What underlies these resource consumption inequalities? Income disparity and purchasing power, of course. 19% of people live on less than $1.25 a day. Based on calculations by Brookings researchers, ending this most extreme income poverty would take less than 0.2% of global income. Enough said.

Figure 3: Ending poverty – no pressure on the planet

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Getting back within planetary boundaries calls for reducing total resource consumption, and redistributing it away from the richest.


According to researchers at Princeton University, around 50% of global carbon emissions are produced for the use of just 11% of people worldwide – let’s call them the global carbonistas, leading fossil fuel intensive lifestyles on every continent, but predominantly in high-income countries.


Of the globally sustainable nitrogen budget (35m tonnes per year), 33% of that is currently used simply to produce animal feed to meet the demand for meat and dairy in Europe, according to the European Nitrogen Assessment. And if you think that reflects badly on Europe, at least they did the calculations, so now can act on it.

It’s clear that getting within social and planetary boundaries demands a strong reduction in resource consumption by the richest and a significant (but very feasible) redistribution towards the poorest.

3. Getting back within planetary boundaries also calls for addressing the unequal distribution of resource use in production processes.

When Rockstrom and co. produced the first analysis of planetary boundaries in 2009, they put forward a single global estimate for each boundary – such as a maximum of 350 parts per million of CO2 in the atmosphere, or 35m tonnes of reactive nitrogen (used widely in fertilizers) to be released into the atmosphere each year.

For some planetary boundaries, the pressure created is ‘well mixed’ meaning that it no matter where it is created, it spreads itself evenly – such as greenhouse gases that add to global warming no matter where they are released from. For these, a single global number for the boundary makes clear sense. Other planetary boundary pressures, such as nitrogen and phosphorus use, are not well-mixed but instead are ‘spatially hetergenous’ (let’s call them ‘lumpy’) in that the pressure is most intense close to where it was created.

If you want to know what lumpy pressure on planetary boundaries looks like, check out these two maps showing first the global use of nitrogen fertilizers, and then global distribution of eutrophication and hypoxia, due to excessive nitrogen and phosphorus, causing algal blooms which deprive aquatic life of oxygen. It’s clear (fig 4a) that nitrogen fertilizer use is very unevenly distributed, and excessively intensive in regional hotspots (in red). And these excesses map closely to the coastal areas suffering the most intensive damage (fig 4b).

Figures 4 a: world nitrogen fertilizer use – and 4b: world hypoxic and eutrophic coastal areas. 

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It appears that for nitrogen, and many other ‘lumpy’ planetary boundary pressures – such as phosphorus use, land use change, biodiversity loss, chemical pollution and water withdrawals – the global distribution of pressure matters, as well as the total. More evenly distributed pressure may reduce total pressure at the global scale – as well as reducing the risk of local ecosystem collapse. Indeed, two Earth-system scientists, Will Steffen and Mark Stafford Smith pointed out in a 2013 paper that this means, “It may well be in the self-interest of wealthy nations to achieve a more spatially equitable world in terms of access to resources and ecosystem services.”

What’s more, when the next iteration of the planetary boundaries framework is published (hopefully not long to wait…), it will propose not only global boundary levels but regional ones too, so bringing more attention to the overall distribution of humanity’s pressure on the planet.

From these three perspectives, one thing is clear. We cannot get into the doughnut’s safe and just space without tackling the distribution of global resource use in both consumption and production. Put simply, if we want to get into the doughnut, then we’ve got to tackle inequality.

All data and references (unless otherwise provided here) can be found in Raworth, K. (2012) A safe and just space for humanity: can we live within the doughnut?

What century are you in? Take the Econ 101 quiz…

[image error]So, how’s the state of your Econ 101? I’m talking about those fundamental economic assumptions you took on board way back when, which are probably so comfortably settled in that you don’t notice them much any more.

If you got them from economics textbooks, they might be just a tad dated – by the odd century or two. Is that a bad thing? It depends on what kind of economist you want to be. Take this little quiz to find out.

 

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If you are wondering which option to go for (it’s the 1860s theory of William Stanley Jevons vs. the 1950s onwards theories of Herbert Simon, Daniel Kahneman and others), here’s some good reading around the question:

Herbert Simon on bounded rationality, such as in his 1957 book Models of Man – or for something a bit more recent check out this paper which shows what happens when you put the ideas of Simon, Kahneman and Amos Tversky together.

Also a good read on human values: Amartya Sen’s 1987 lectures On Ethics and Economics, making an impressive bid to rescue Adam Smith from being parodied by history as saying we are motivated only by self-interest. (And Michael Sandel’s What Money Can’t Buy adds the modern question of what happens when we put money motivation where our morals once were…)

And if you like live action, well you still can’t beat Dancing Man for illustrating just how socially influenced we are.

 

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For a thorough slicing up of Marshall’s 1890’s scissors (the intersection of Supply and Demand curves – setting price where they cross), check out Steve Keen’s 2011 very detailed (and very funny) book Debunking Economics – and to see how he gets from scissors to noodles, read Chapters 3-4.

What’s more, Keen sets out in detail how some smart economists spotted a flaw at the heart of equilibrium theory in the 1970s (known as the Sonnenschein-Mantel-Debreu theorum – there’s nothing like a snappy name…), but the implications were so devastating that the economists simply kept it quiet, dropped it from the textbooks, and kept going.

 

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Here’s a choice based on what you think is the fundamental flow of the economy.

Is it the Circular Flow of Goods and Income, iconically drawn by Paul Samuelson in his 1948 classic textbook Economics – and repeated by others ever since – resembling a set of perpetual water pipes running in a loop between households and firms?

Or – as Nicholas Georgescu-Roegen wrote in 1971 (based on the second law of thermodynamics) – is the fundamental flow actually energy and matter flowing from low entropy (like useful fuel) to high entropy (like dissipated heat), looking something like a one-way hourglass ?

For more on the consequences of opting for the hourglass view of the world, check out eg Daly and Farley’s textbook Ecological Economics or this shorter piece by Herman Daly.

 

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First, for a read up on this debate, there’s a wonderful (but hard to come by) history by Heinz Arndt (1978) The rise and fall of economic growth which highlights just how recent is the belief in eternal exponential GDP growth.

The arguments between unlimited growth and limits to growth have compelling advocates on both sides, as I have blogged about earlier.

So, let’s go for some bonus questions.

If you opt for a): what is so different about GDP growth that allows it to defy nature and grow forever?

If you opt for b): where do you think we are now on the logistic curve, and why? And what happens at the plateau?

OK, quiz over.

Tot up your answers to find out which century you are in.

If you answered mostly A: Well done indeed. You will be able to find a steady job teaching the undergraduate syllabus in most university economics departments. With this combination of pre-1900s theoretical foundations and post-1950s unwavering conviction in eternal GDP growth, you will achieve a good standing in the field. But it might just be wise to steer clear of the real world (for its sake and yours).

If you answered mostly B. Oh dear oh dear. You are unlikely to pass any exams at all in economics with this kind of attitude. Forget about your articles being accepted by the top journals and give up on your dreams of a senior departmental appointment. But you know what, there’s a real world facing a crisis or two out there and a maverick approach like yours might just come in handy. Please, stick around, humanity needs you.

If you answered C. An agnostic mind: fabulous! Please hang out with the ‘mostly b)’s and make sure they don’t get too set in their ways. There’s an awful lot still to figure out….

Will these Sustainable Development Goals get us into the Doughnut?

The UN has just published a proposed set of Sustainable Development Goals – to guide humanity’s social and ecological journey through to 2030. So will these SDGs steer us into the doughnut?

Check out my 3-point analysis in a guest post on Duncan Green’s great development blog.

My top line view? These draft SDGs contain much to celebrate, but are lop-sided in ambition, and deluded on economic growth. As they stand, they’ll get us over the social foundation, but not back under the environmental ceiling. And human wellbeing depends fundamentally on both.

I’d love to hear others’ views – so do leave a comment on Duncan’s blog.

Spot the difference: the SDGs vs the Doughnut

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