Eco-capitalism
Encyclopedia
Eco-capitalism is one of several strategies of the green movement
and Green Parties. Its central idea is that capital
exists in nature as "natural capital
" (self-renewing productive ecosystem
s that have a measurable ecological yield
or tangible benefit to humans) on which all wealth
depends. Other forms of capital that are created by humans (like infrastructural capital
and financial capital
) simply extend and optimize this natural capital with creativity, training and trust. In this view ecosystem services
are the base of a service economy
- so interfering with nature's services destroys rather than creates value, and must not be rewarded with assistance or subsidies from the state. However, other than that, competition between humans is thought to be inevitable and an effective way to organize - rather in the same way as certain animal species. In this line of thought, biologist Lynn Margulis
claimed that economics
is the study of how humans make a living, while ecology
studies how other species make a living.
More than other types of green politics
, this strategy advocates monetary reform
and the use of eco-friendly business models and economic policies. It usually includes any environmental policy with an intended positive economic return. An example are the rules against overfishing to allow stocks to replenish for future fishing, resulting in a so-called sustainable fishery
. This pleases many scientific ecologists but not, for instance, animal rights
advocates.
Eco-capitalism seeks creative policy instruments to resolve environmental problems where public goods are difficult to protect. Unlike in other green economics, it is usually very possible to construct a value of life
or value of Earth
analysis using eco-capitalist models, or even to reconcile the utility of various choices as would be done in neoclassical economics
. Because everything is reduced ultimately to some number, a price premium
can be calculated by each choice in, say, a moral purchasing or regulatory regime. This makes it possible, according to advocates, to actually make globalism
work. The Kyoto Protocol
, for instance, assigns a de facto value to human life in developing nations of about 1/15 the value of a life in developed nations, based on the ability of the latter to pay to prevent deaths due to climate change
.
Some have described this strategy as a form of realpolitik
, a constructive non-ideological compromise between the existing power structures and banking systems of the International Monetary Fund
(IMF) and Bank for International Settlements
(BIS) and the emerging consensus that ecological systems have value.
The term "Blue Greens" is sometimes applied to those who espouse eco-capitalism. This can either be greens
who accept or favor free market
principles to achieve environmental aims or conservatives
or liberals
who espouse Green policies or, more generally, environmental concerns. The term should be contrasted with Red Green
s.
Eco-capitalism is akin to the ecological bottom line of Triple Bottom Line
business theory.
Green Movement
The Green Movement refers to a series of actions after the 2009 Iranian presidential election, in which protesters demanded the removal of Mahmoud Ahmadinejad from office...
and Green Parties. Its central idea is that capital
Capital (economics)
In economics, capital, capital goods, or real capital refers to already-produced durable goods used in production of goods or services. The capital goods are not significantly consumed, though they may depreciate in the production process...
exists in nature as "natural capital
Natural capital
Natural capital is the extension of the economic notion of capital to goods and services relating to the natural environment. Natural capital is thus the stock of natural ecosystems that yields a flow of valuable ecosystem goods or services into the future...
" (self-renewing productive ecosystem
Ecosystem
An ecosystem is a biological environment consisting of all the organisms living in a particular area, as well as all the nonliving , physical components of the environment with which the organisms interact, such as air, soil, water and sunlight....
s that have a measurable ecological yield
Ecological yield
Ecological yield is the harvestable population growth of an ecosystem. It is most commonly measured in forestry;sustainable forestry is defined as that which does not harvest more wood in a year than has grown in that year, within a given patch of forest....
or tangible benefit to humans) on which all wealth
Wealth
Wealth is the abundance of valuable resources or material possessions. The word wealth is derived from the old English wela, which is from an Indo-European word stem...
depends. Other forms of capital that are created by humans (like infrastructural capital
Infrastructural capital
Public capital is the aggregate body of government-owned assets that are used as the means for private productivity. Such assets span a wide range including: large components such as highways, airports, roads, transit systems, and railways; local, municipal components such as public education,...
and financial capital
Financial capital
Financial capital can refer to money used by entrepreneurs and businesses to buy what they need to make their products or provide their services or to that sector of the economy based on its operation, i.e. retail, corporate, investment banking, etc....
) simply extend and optimize this natural capital with creativity, training and trust. In this view ecosystem services
Ecosystem services
Humankind benefits from a multitude of resources and processes that are supplied by natural ecosystems. Collectively, these benefits are known as ecosystem services and include products like clean drinking water and processes such as the decomposition of wastes...
are the base of a service economy
Service economy
Service economy can refer to one or both of two recent economic developments. One is the increased importance of the service sector in industrialized economies. Services account for a higher percentage of US GDP than 20 years ago...
- so interfering with nature's services destroys rather than creates value, and must not be rewarded with assistance or subsidies from the state. However, other than that, competition between humans is thought to be inevitable and an effective way to organize - rather in the same way as certain animal species. In this line of thought, biologist Lynn Margulis
Lynn Margulis
Lynn Margulis was an American biologist and University Professor in the Department of Geosciences at the University of Massachusetts Amherst. She is best known for her theory on the origin of eukaryotic organelles, and her contributions to the endosymbiotic theory, which is now generally accepted...
claimed that economics
Economics
Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...
is the study of how humans make a living, while ecology
Ecology
Ecology is the scientific study of the relations that living organisms have with respect to each other and their natural environment. Variables of interest to ecologists include the composition, distribution, amount , number, and changing states of organisms within and among ecosystems...
studies how other species make a living.
More than other types of green politics
Green politics
Green politics is a political ideology that aims for the creation of an ecologically sustainable society rooted in environmentalism, social liberalism, and grassroots democracy...
, this strategy advocates monetary reform
Monetary reform
Monetary reform describes any movement or theory that proposes a different system of supplying money and financing the economy from the current system.Monetary reformers may advocate any of the following, among other proposals:...
and the use of eco-friendly business models and economic policies. It usually includes any environmental policy with an intended positive economic return. An example are the rules against overfishing to allow stocks to replenish for future fishing, resulting in a so-called sustainable fishery
Sustainable fisheries
Sustainability in fisheries combines theoretical disciplines, such as the population dynamics of fisheries, with practical strategies, such as avoiding overfishing through techniques such as individual fishing quotas, curtailing destructive and illegal fishing practices by lobbying for appropriate...
. This pleases many scientific ecologists but not, for instance, animal rights
Animal rights
Animal rights, also known as animal liberation, is the idea that the most basic interests of non-human animals should be afforded the same consideration as the similar interests of human beings...
advocates.
Eco-capitalism seeks creative policy instruments to resolve environmental problems where public goods are difficult to protect. Unlike in other green economics, it is usually very possible to construct a value of life
Value of life
The potency of life is an economic value assigned to life in general, or to specific living organisms. In social and political sciences, it is the marginal cost of death prevention in a certain class of circumstances. As such, it is a statistical term, the cost of reducing the number of deaths by...
or value of Earth
Value of Earth
In green economics, value of Earth is the ultimate in ecosystem valuation, and important to value of life calculations. It begins with the simple problem that if the Earth ceases to support life, and human life does not continue elsewhere, all economic activity will also cease.-Methods of...
analysis using eco-capitalist models, or even to reconcile the utility of various choices as would be done in neoclassical economics
Neoclassical economics
Neoclassical economics is a term variously used for approaches to economics focusing on the determination of prices, outputs, and income distributions in markets through supply and demand, often mediated through a hypothesized maximization of utility by income-constrained individuals and of profits...
. Because everything is reduced ultimately to some number, a price premium
Price premium
Price premium, or relative price, is the percentage by which a product’s selling price exceeds a benchmark price. Marketers need to monitor price premiums as early indicators of competitive pricing strategies. Changes in price premiums can also be signs of product shortages, excess inventories, or...
can be calculated by each choice in, say, a moral purchasing or regulatory regime. This makes it possible, according to advocates, to actually make globalism
Globalism
Globalism can have at least two different and opposing meanings. One meaning is the attitude or policy of placing the interests of the entire world above those of individual nations...
work. The Kyoto Protocol
Kyoto Protocol
The Kyoto Protocol is a protocol to the United Nations Framework Convention on Climate Change , aimed at fighting global warming...
, for instance, assigns a de facto value to human life in developing nations of about 1/15 the value of a life in developed nations, based on the ability of the latter to pay to prevent deaths due to climate change
Climate change
Climate change is a significant and lasting change in the statistical distribution of weather patterns over periods ranging from decades to millions of years. It may be a change in average weather conditions or the distribution of events around that average...
.
Some have described this strategy as a form of realpolitik
Realpolitik
Realpolitik refers to politics or diplomacy based primarily on power and on practical and material factors and considerations, rather than ideological notions or moralistic or ethical premises...
, a constructive non-ideological compromise between the existing power structures and banking systems of the International Monetary Fund
International Monetary Fund
The International Monetary Fund is an organization of 187 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world...
(IMF) and Bank for International Settlements
Bank for International Settlements
The Bank for International Settlements is an intergovernmental organization of central banks which "fosters international monetary and financial cooperation and serves as a bank for central banks." It is not accountable to any national government...
(BIS) and the emerging consensus that ecological systems have value.
The term "Blue Greens" is sometimes applied to those who espouse eco-capitalism. This can either be greens
Green Movement
The Green Movement refers to a series of actions after the 2009 Iranian presidential election, in which protesters demanded the removal of Mahmoud Ahmadinejad from office...
who accept or favor free market
Free market
A free market is a competitive market where prices are determined by supply and demand. However, the term is also commonly used for markets in which economic intervention and regulation by the state is limited to tax collection, and enforcement of private ownership and contracts...
principles to achieve environmental aims or conservatives
Conservatism
Conservatism is a political and social philosophy that promotes the maintenance of traditional institutions and supports, at the most, minimal and gradual change in society. Some conservatives seek to preserve things as they are, emphasizing stability and continuity, while others oppose modernism...
or liberals
Liberalism
Liberalism is the belief in the importance of liberty and equal rights. Liberals espouse a wide array of views depending on their understanding of these principles, but generally, liberals support ideas such as constitutionalism, liberal democracy, free and fair elections, human rights,...
who espouse Green policies or, more generally, environmental concerns. The term should be contrasted with Red Green
Eco-socialism
Eco-socialism, green socialism or socialist ecology is an ideology merging aspects of Marxism, socialism, green politics, ecology and alter-globalization...
s.
Eco-capitalism is akin to the ecological bottom line of Triple Bottom Line
Triple bottom line
The triple bottom line captures an expanded spectrum of values and criteria for measuring organizational success: economic, ecological, and social...
business theory.
Eco-capitalist monetary and administrative reforms
- Genuine Progress IndicatorGenuine Progress IndicatorThe genuine progress indicator is an alternative metric system which is an addition to the national system of accounts that has been suggested to replace, or supplement, gross domestic product as a metric of economic growth...
s as basis of monetary reformMonetary reformMonetary reform describes any movement or theory that proposes a different system of supplying money and financing the economy from the current system.Monetary reformers may advocate any of the following, among other proposals:... - full cost accountingFull cost accountingFull cost accounting generally refers to the process of collecting and presenting information - about environmental, social, and economic costs and benefits/advantages - for each proposed alternative when a decision is necessary. It is a conventional method of cost accounting that traces direct...
for ecological harms done by subsidies - pollution credits to encourage businesses to adopt anti-pollution technologies
Examples of eco-friendly business models
- The privatization of eco protection e.g. http://www.sustainablebusiness.com/
- Green Business Consultant (Jim HarrisJim Harris (politician)James R. M. "Jim" Harris is a Canadian author, environmentalist, and politician. He was leader of the Green Party of Canada from 2003 to 2006, when he was succeeded by Elizabeth May.-Early life and Green activism:...
, former leader of the Green Party of CanadaGreen Party of CanadaThe Green Party of Canada is a Canadian federal political party founded in 1983 with 10,000–12,000 registered members as of October 2008. The Greens advance a broad multi-issue political platform that reflects its core values of ecological wisdom, social justice, grassroots democracy and...
) - environmental entrepreneurism Bill Shireman
- Natural CapitalismNatural capitalismNatural Capitalism: Creating the Next Industrial Revolution is a 1999 book co-authored by Paul Hawken, Amory Lovins and Hunter Lovins. It has been translated into a dozen languages and was the subject of a Harvard Business Review summary....
eco-options; eco-arbitrage; eco-secondary markets (Lovins) - ecopreneur "entrepreneurs using business tools to preserve open space, develop wildlife habitat, save endangered species, and generally improve environmental quality"
- TerraCycle Inc. TerracycleTerraCycleTerraCycle is a private U.S. small business headquartered in Trenton, New Jersey, which specializes in making consumer products from pre- and post-consumer materials....
http://www.terracycle.net/eco_capitalism.htm - Environmental Waste SolutionsEnvironmental Waste SolutionsEnvironmental Waste Solutions is a private U.S. small business headquartered in Baton Rouge, Louisiana, which specializes in assisting businesses in becoming more environmentally friendly...
; Sustainability initiatives in business http://www.environmental-waste.com/green-business-initiatives.html
See also
- Business modelBusiness modelA business model describes the rationale of how an organization creates, delivers, and captures value...
- Ecological economicsEcological economicsImage:Sustainable development.svg|right|The three pillars of sustainability. Clickable.|275px|thumbpoly 138 194 148 219 164 240 182 257 219 277 263 291 261 311 264 331 272 351 283 366 300 383 316 394 287 408 261 417 224 424 182 426 154 423 119 415 87 403 58 385 40 368 24 347 17 328 13 309 16 286 26...
- Free-market environmentalismFree-market environmentalismFree-market environmentalism is a position that argues that the free market, property rights, and tort law provide the best tools to preserve the health and sustainability of the environment...
- Green economics
- Green libertarianismGreen libertarianismGreen Libertarianism is a hybrid political philosophy that has developed in the United States. Based upon a mixture of political third party values, such as the environmental platform from the Green Party and the civil liberties platform of the Libertarian Party, the green libertarian philosophy...
- Tragedy of the commonsTragedy of the commonsThe tragedy of the commons is a dilemma arising from the situation in which multiple individuals, acting independently and rationally consulting their own self-interest, will ultimately deplete a shared limited resource, even when it is clear that it is not in anyone's long-term interest for this...
- Tragedy of the anticommonsTragedy of the anticommonsThe tragedy of the anticommons is a neologism coined by Michael Heller to describe a coordination breakdown where the existence of numerous rightsholders frustrates achieving a socially desirable outcome. The term mirrors the older term tragedy of the commons used to describe coordination...
- Enviro-Capitalists: Doing Good While Doing WellEnviro-Capitalists: Doing Good While Doing WellEnviro-Capitalists: Doing Good While Doing Well is a 1997 book written by economists Terry Lee Anderson and Donald R. Leal. In this book, Anderson and Leal further developed the concept of free market environmentalism, which they first described in their 1992 book Free Market Environmentalism...
Other sources
- Chapple, Stephen (2001) Confessions of an Eco-Redneck: Or how I Learned to Gut-Shoot Trout and Save the Wilderness at the Same Time ISBN 0-641-54292-5 Perseus Publishing - September 2001
- Comolet, A. (1991). The Ecological Renewal. From Eco-Utopia to Eco-Capitalism Le Renouveau ecologique. De l'eco-utopie a l'eco-capitalisme. Futuribles, 157(Sept.), 41-54.
- Lovins, Amory BAmory LovinsAmory Bloch Lovins is an American environmental scientist and writer, Chairman and Chief Scientist of the Rocky Mountain Institute. He has worked in the field of energy policy and related areas for four decades...
& Hunter L (1997) Factor Four. Doubling Wealth - Halving Resource Use with Ernst von WeizackerErnst Ulrich von WeizsäckerErnst Ulrich von Weizsäcker is a German scientist and politician.He is son of the physicist Carl Friedrich von Weizsäcker and nephew of the former German President Richard von Weizsäcker....
Earthscan Publications Ltd, London
- Sarkar, Saral (1999) Eco-Socialism Or Eco-Capitalism? : A Critical Analysis of Humanity's Fundamental Choices by Saral Sarkar 1999
- Porritt, Jonathon (2005, revised 2007) Capitalism: As If The World Matters. ISBN 978-1-84407-193-7 Earthscan Publications Ltd, London
- d'Humières, Patrick (2010) Le développement durable va-t-il tuer le capitalisme ?. Editions Maxima
External links
- CIDM
- Natcap.org
- RMI.org
- Eco Companies Directory
- Ecocapitalisme.org by Patrick d'Humières
- Beyond "Green Capitalism" by Monthly ReviewMonthly ReviewMonthly Review is an independent Marxist journal published 11 times per year in New York City.-History:The publication was founded by Harvard University economics instructor Paul Sweezy, who became the first editor...