Friday, March 20, 2009

Exchange on the difference between biophysical and ecological economics

Email posted on March 3, 2009

Dear Charlie:

I hope I don't need to say how big a fan I am of your work and presentations. I also find this energy list very useful and informative. Thanks.

May I only ask one funny question. How is this "biophysical economics" different from what we used to know as "ecological economics"? Taking a quick look at the web site and the description that you've got there, I really could not find anything there that ecological economics would not approve and subscribe to. I am aware that with the recent excitement about ecosystem services and their
valuation, something that to my mind entirely belongs to environmental economics only, some of the gurus of ecological economics have, indeed, watered down the field. But I would think that still ecological economics remains what it was supposed to be originally.

In open source there is such a notion as "threading". That is when a project splits into two, when instead of joining forces and pursuing one common goal, the project team falls apart. Usually this happens when two leaders emerge and can't find a way to reconcile and share the glory.

Generally threading in the open source community is regarded as dilution of forces, and a negative phenomenon.

I'm sorry if I may sound a bit too straight. But I know that you're like that yourself and I'm ready to accept that it's probably due to my negligence or ignorance.

Anyway, would appreciate some comments or leads to where I can find good answers.
Thanks, A
Response from Charlie:

Karin Limburg asks me the same question, and is mildly offended or maybe hurt that I do not cut EE enough slack. She is right down the hall (lucky me!) so I do not think you are guilty of negligence or ignorance.

The short answer: there is no difference given Costana's original Venn diagram. The longer answer: hmmm. I was thinking something like this earlier today and asked Marvin, who manages the site, to add something. Marvin could you forward that to Alexy? Maybe there is something more we should use.

Alexy there should be no difference but there is. I just gave yesterday a summary of my "intellectual history" vis a vis these issues to my Biophysical economics class. It went something like this:

"I was originally very excited about the formation of ecological economics and I liked Costanza's original definition "Wherever ecology and economics overlap" (with a Venn diagram). I went to the meeting in San Jose in 1994 in great anticipation and was excited to see, what was it, 3000 people there. But while there my friend Tommy Shlichter, a very perceptive person, came up to me and said "As far as I can tell, you are the only real ecologist here". I don't know if that was true but it caught something --that ecological economics has been dominated overwhelmingly by economists or those who have been toilet trained to think as they would have us --putting monetary values on parrots or ecosystems or whatever and then turn the same basically neoclassical crank. It is also dominated by people more interested in policy than how the world works. (OK that is a caricature but it has more than a little reality.)

Since my earliest interest in these issues, guided by HTO, and because I am an ecologist and a scientist, I have been interested in looking at economic systems as ecosystems using the scientific method in its broader sense... that is my toilet training. In about 1978 I became increasingly turned off to modeling in ecology (I fancied myself a modeler) because I thought many basic models (logistic, Lotka Volterra, Ricker etc ) were BS (See Hall 1988 on my web site). It got me in a lot of trouble at Cornell because I would speak out about my thoughts on this. We would have seminar after seminar by famous (theoretical) ecologists that I thought were indefensible.... and I still think that true. Recently I met one of these types, a good one, who said to me "I had to learn all that hard math in grad school and what are we left with? Nothing." Wish I could remember his name. Not everyone will agree.

So I spent 8 years learning economics with Cutler and Robert -- thinking that since there were far more economists and they were better mathematicians and had far more time and data to develop their theories I was astonished to find the same things in economics as ecology: the basic models just made no biophysical sense and there was a vast confusion of scientific rigor with mathematical rigor.

I thought we were going to attack this problem in Ecological Economics but with very few exceptions (Dung, obviously Georgescu-Roegen) no one was interested in exposing the bullshit of conventional economics which I thought necessary before going forward. Going forward then meant to me building an economics on something real. The recent collapse of the value and even the meaning of a dollar in the stock market, housing etc indicates that we need something besides money to build our economics on. Energy/resources are not perfect but are closer than dollars to express value (I will send you my Dow Jones analysis to lend a little credibility to that idea). Money corrected for inflation (which we do not do properly) of course ultimately has to follow, not lead energy and other indices of real wealth.

So in my opinion, and do not repeat this too loudly in Burlington, EE had its chance but focused on the wrong issues, or at least did not put the economics house in order before going about its business. In fact it is not even interested in putting the economic house in order, and I have a string of rejections to prove it (or something). But I have had dozens of people I respect say essentially the same thing to me.

I think personally that peak oil, declining EROI, resource depletion, fresh water issues and so on will dicate the rest of civilization's days, and few will care about valuing ecosystems services even as they become more necesssary. But I would not argue that way. I am a scientist, or try to be, not a policy person, and I try to understand the role of energy in various ecosystems and species, including that which we call economics. Maybe this leads to my final point: that I find putting dollar values on everything (necessary and useful might that be) as uninteresting, as a kind of thing for people with green eyeshades with degrees in accounting (although of course figuring out how to do that is intellectually demanding). And I think that here is more intellectual creativity in attempting to figure out exactly how energy is the currency of ecosystems, including our economy, and how ecosystems respond to more and less available energy. Or maybe I am just interested in energy and not money. I respect and sometimes admire the efforts of others, but mostly it just deos not spin my wheels. I hope I do not sound arrogant, but you are seeking truth (whatever that is) and I try to provide that.

Now your comment on joining or splitting our efforts has blindsided me, as I have not thought about it that way. I do not know how to answer it. Maybe it is a political question and hence just bounces off my back like a duck! But I never wished to undermine anyone, and I do not know that what I am doing is better than other approaches, its just what I do. Let me think about that.

Well that was quite a ramble, and I do not know how well I did. But I did try to answer your question! I think you might be able to get some of my thoughts in order, so feel free to respond.

Follow-up by A:

In many respects you are preaching to the choir. As mentioned above, I also regard ecosystem valuation and monetary analysis to be more appropriate for what we know as environmental economics. I would dare say that ecological economics is still different from that. I guess I am thinking of ecological economics not just as 'Costanza' but also or even rather as 'Daly, Farley, et al.'. I don't think that you will need to persuade them that money is not what drives the system, and that energy/resources are way more important than dollars and stocks. In fact, I'm sure that Costanza would also agree with that.

Where I feel there may be a bit of a disconnect is with your goal to put everything on an entirely physical basis and drive everything by something like energy. I'd say that as long as we have the human component present and until we learn to exactly understand humans and their behavior as a product of energy flows through neural circuits and digestive tracts, we will have something way more uncertain and, perhaps, exciting than what the first principles will tell us. Not to diminish the importance of thermodynamics, of course, but the fact that we may have so different economic (whatever that word means), social and cultural organizations in places with with very similar levels of energy consumption. And vice versa, see for example, the well known graphs of human life satisfaction and life expectancy, as functions of energy use, which show that the same life satisfaction can be delivered by orders of magnitude different energy flows.

So there really may be more in human behavior than just energy transfer.

On the other hand, if you say that 'ecological economics' blew it, meaning that it had it's chance to build an alternative economics, but has forfeited the brand and is no longer regarded as respectful - that I would take seriously, and perhaps something to consider among ecological economists as a real threat. If that is really the case, perhaps, indeed, it is time to look for an alternative trademark and start regrouping our forces and ideas under a different brand name, be it biophysical economics or something else. Personally I don't think that it's that hopeless, and, must confess, that have some vested interests in the brand, especially after publishing my book last year on modeling for ECOLOGICAL ECONOMICS. It will be unfortunate to find out that Ecol. Econ. is done with. :-)

I'm also taking the liberty to add a couple more addressees to this thread, because it may turn out to be a more important issue to discuss than I thought at first. I do think that it is not helpful, when we get into feuds among ourselves over small differences and egos. I do think that we've got so much to do and so soon that we need to be very clear about the stand we take and the "tribe" we belong to. Otherwise it becomes confusing for others to identify us and to figure out where they should belong. I am not saying that 'biophysical economics' is a bad idea. Maybe it is indeed exactly where we all should be navigating towards. But then let's make it a 'tribal' decision and make sure we are not leaving our good buddies behind.

Cheers, A
Response from Charlie

Hmm we do have a problem, It is not what you think but that you are a bottom responder and I am a top responder. So I will respond to you on the top!

OK lets see if we have any other particular differences:

I think the crux of whatever "disagreement" we might have (and I hope they are slight) is your statement:

"Where I feel there may be a bit of a disconnect is with your goal to
put everything on an entirely physical basis and drive everything by something
like energy."

For the record I am not saying that, or I do not mean to anyway. It is NOT my goal. And I believe energy is not exactly a driver but a companion to whatever we do (economic or otherwise ) and a constraint for sure. I am a systems ecologist, and surely I recognize that energy is only a part of whatever is going on. My objective is to study and hopefully understand energy, not to explain or manage the world in all of its complexities. Thus I have no argument here or before with your or anyone studying neural networks or whatever, not do I, as once accused, espouse an energy theory of value. All I was saying is that it is not my research focus. Energy is. And I have rarely if ever (I think) written a paper on policy or what policy should be other than let's get our understanding of our (economic or whatever) systems consistent with (my perception of) reality.

I did say that I believe that EE has been too much about using a kind of economics that accepts and uses moneterization, but that does not mean those EE analyses should not be done or accepted. It is just not my thing, and I do believe that EE has been far too uncritical of conventional economics. But as Bob told me once "we review what comes in, and if you are not happy then submit a paper" --which I was rather remiss about. I have no wish to unhorse or disrespect EE but rather do wish to provide a forum for those with ideas similar to mine (and there are quite a few) can collect our thoughts.

Does that clarify? I think these thoughts are in my original letter to which you responded but maybe not stated clearly enough.

Comment by N:

My precaffeinated 2 cents is that another threading/dilution is on the horizon, which will piggyback whichever way our political paradigm changes. Ecological economics was written in a language that could be synthesized by the cultural metric of the time: money/economics was correlated with social power, so to get peoples attention living in a 'money' world, ecology academically had to be translated into money. 99% of world's banks are now technically insolvent and I see no way the entire system doesn't splinter, with new currencies and the social disruptions that accompany them. Ecology is important, because we live and value ecosystems as part of our lives. Economics is really how biological creatures interact with each other in a system with free markets, and prices, which may not always be the case. (I expect energy firms will be early on the list of nationalization to hide net energy decline from the public, and subsume it in the currency instead).

Ecological/ biophysical economics made a great stride in saying that the economy was part of the environment, and therefore had limits. But neither looked adequately at the demand side of human actors in a resource constrained world, other than some outdated theories such as Jevons, which assumes price elasticity, etc rather than a more basic separation of needs vs (everything else). Any future 'discipline' that honestly attempts holistic answers to living in a more durable fashion on the planet will have to delve more into the human nature/culture side of things. What happens with a new currency (or no currency) and economic crisis? Do parrots and rivers also experience deflation? Do we need to redo all the papers showing the 'worth' of the amazon and translate them into a local currency basket?

As heterodox as they are, these 2 disciplines still need a larger umbrella. Finances rule in society is over. If it recovers, (which I sincerely hope because it will buy us time), it will be weaker and play less central of a role - too much confidence is lost and too much awareness of energy, water, GHG etc limits exists, even if not publicly acknowledged. A longer term academic discipline integrating ecological and bio-cultural limits of human interaction of the planet will be needed - ecological ethology might be a more appropriate name. Both biophysical economics and ecological economics could move in this direction, though I expect another thread will emerge.

Off to get coffee so my discount rate for rest of morning is steeper, and I get more done...;-)

Cheers, N
Follow-up comment from A:

Dear Charlie:

The first problem that you mentioned is easy to resolve. In fact I am also a top feeder,... eh, sorry, responder. It was only because you've responded to my original post at the bottom that I thought that this is what you prefer, and thought that it may make sense if you are inviting other people to the discussion and want to give them the story as it evolved.

Anyway, now we have a perfectly confusing chain of messages and responses and might as well continue responding anywhere we wish.

From what you write besides that, I can only conclude that there is even less controversy in our approaches and that we are equally open to studying energy, neural network, behavior patterns, or whatever else is needed.

This brings us back to the real crux of the problem: is EcEc really hopeless and discredited to the extent that we should shy away from the trademark, or there is still potential and we do not necessarily have to be ashamed of being associated with it. I do not know the answer to this.

I really like N's idea of perhaps searching for some sort of umbrella name that would include all the 'logical' economics and would have EcEc, BPhEc (biophysical economics), as well as other 'friendly' denominations (Georgian economics?) In which case I think it's crucial to make it clear that we have similar goals and it's only in the flavors and sauces that we may be different in.

If you see BPhEc as a forum to discuss ideas rejected by EcEc, I'd be really curious to see what are those ideas? Anyway, I'll be looking forward to see some more explanations on your web site, and do hope that we can stay on friendly grounds and help advance the strengths of our both denominations.

Thanks, A
Final response from Charlie:

Now we are indeed on the same (top of) the page. I feel that I am sometimes misunderstood because I speak bluntly and, unknowingly and occasionally, at the bottom of a post.

In theory and going back to Costanza's original Venn diagram Ecological Economics should be the umbrella organization. I do not know if that is possible now but have no problem I guess. The Journal might make a stab at summarizing the sub cults and the reasons for them. But the de facto logic and normal operating procedures of the sub cultures is truly different. I personally am not too worried about how we slice the cake for we have what I need on the new BPE blog site. But I agree with your perspective but would rephrase it: I think we all have very serious issues with how conventional economics is done and we should be united against the common "enemy".

We invite people to join in the discussion. Thanks!!!


Anonymous said...

I completely understand why Charlie wants to differentiate BPE from EE because it is the exact SAME reason why we all have a bone to pick with NCE and the exact SAME reason why I will not fully embrace any of these disciplines; they are ALL flawed and in their present state of being NONE of them can reconcile the most fundamental issue of our time and what I see as the only thing worth obsessing over and devoting myself to until it is resolved.

More specifically....

NCE ignores/denies the biophysical budget constraints of unlimited economic growth and the possible outcomes of this denial.

EE has lost its focus on trying to reconcile this most fundamental issue that was at the heart of its formation as a discipline.

BPE wants to bring the focus back to the biophysical underpinnings but loses sight of other issues like the political economy and social theory that cannot be abstracted from any real explanation of how human dominated ecosystems function or how to properly deal with them.

Whatever label we want to give ourselves is completely irrelevant. What matters is figuring out a unified theory that can actually begin make a dent in NCE theory and macro-application. Until that happens we can grant ourselves any intellectual sounding title we want, or we can just call our selves the shit-shovelers and it will not matter one bit either way because we are not going to revolutionize and remake the world or even be heard by anyone outside of a very tight academic circle for that matter.

Lots of amazing work has been done, none of it by me, but it just does not add up to anything that can resolve our biggest problem which is the fact that the modern global society can not continue in its current state of being and no one has come up with any realistic way of dealing with that inescapable and all encompassing fact.


Unknown said...

I have never felt comfortable with any of the modifying terms, such as EE , NCE ... As far as I am concerned there ought to be only one "economics" whose principles are in conformity with the constraints imposed on it by the other fields such as natural capital and the laws of thermodynamics.
The above implies that we do not have to through away the baby with the dirty water so to speak for the sake of ideological purity. If there are tools or ideas that have been developed by "monster" economics and others by "just " economics and both are deemed to make sense then both these tools should be accepted into "economics" What we need to do is to exorcise economics of its "evil" and wrong headed ideas ideas in an effort to create a sub field of knowledge that is in harmony with the overall riding reality. The principles of any of the different varieties of economics that are at odds with ecology, physics , justice morality ...ought to be discredited and replaced by other principles and ideas.

If one is to subscribe to the idea of Consilience , as revived by E O Wilson then there ought to be room for only one economics and all pretenders ought to be banished.

Anonymous said...

This is a realy interesting discussion. I agree with all of you but I would just like to point out a few things.
1. The ecosystem valuation bullshit originated with ecologists not economists (I'm not going to name names). The biggest challenge to ecological economics today is not so much from mainstream economics (whch is rapidly changing for the better) but from biologists who have bought into the Chicago School propoganda that there is no conflict between markets and the natural world. Jusy correctly price biodiversity and everything will be O.K.
2. For the last ten years ecological economics (judging from the papers in the journal) was diluted by neoclassical refugees who couldn't publish there papers in the mainstream environmental economics journals (Land Economics and the Journal of Environmental Economics and Management). This is starting to change.
3. The intellectual core of NCE (Walrasian general equilibrium theory) has been dead for 20 years at least. Economists are afraid to bury the corpse because so many of their basic tools (like marginal analysis, potential Pareto improvements, total factor productiveity, elsticity of substitution) are based on its very restricetive mathematical properties.


sharpgary said...


What you are all haggling about is what "Name" is most 'definitive and socially/academicaly acceptable' -

The Big Picture within which Ecology and Economics are both situated is best considered to be 'Applied System Science' - within which a similar, but far more expansive web diagram would get one 'outside' the various sub-systems - allowing a more open perspective of 'what responds to what' - on which time and spatial scales.

EG. -Ocean sciences are not just about the oceans, but also wind speeds, directions, light levels at various wave lengths, and Sol/Lunar tidal effects, and geography - while the earth spins, generating differing Coriolus forces - and of course, the dynamic and continuous effects of the various sub-components of the Universe - as they interact, and effect one another...

Dollars are a very minimal component of anything except the Human Greed Syndrome -
that has lots of local effects - mostly slowing down general 'coping strategies' that would/should be updated regularly - before the negative components induce all the messes that we worry about.

Perhaps 'Economics' is simply a poorly defined sub-set of the real complexities needing attention.


cblog said...

What's in a name? That which we call a rose by any other name would smell as sweet.

I could not agree more with Charlie that, "peak oil, declining EROI, resource depletion, fresh water issues and so on will dicate the rest of civilization's days." It ain't gonna be pretty folks. (I still value ecosystem services though and will stay on my soapbox about their value.)

aav said...

No, this is not about just the name. As I've described in my very first post, what I'm really concerned about is branching. That is when people who are actually doing something very similar, instead of supporting each other and doing a better job presenting their ideas to the outside world, choose to carve new niches, go for new names, new trademarks. In essence it's the same, but it's mine, and I want a trademark that goes with me, with my name. This, to my mind, can only dilute the effort and is not helpful for the common goal.

It appears that we can agree that there are no contradictions between EE and BPE, that they are striving for the same overarching goals and disseminating similar ideas. Perhaps it would be helpful to make sure that this is clear to the others. BPE can then be still part of EE, especially if we strip EE of all the excess monetary valuations that tend to distort the basic principles of EE.

Anonymous said...

"Of no school I am part,
Never to living master lost my heart,
Nor any more can I be said
To have learned anything from the dead."
That statement - subject to appeal -
Means "I'm a self-made imbecile."
(J.W. Goethe, Den Originalen, 1812).

pfh said...

There's a fundamental issue here I think. There are lots of scientific languages with no way to refer to each other's definitions and meanings. I've been studying and writing about that for a few years, how human knowledge tends to form separated bubbles of useful information, with each community of interest forming their own separate one.

I think that is the particular circumstance being referred to in the old Buddhist fable about a proverbial “elephant” and six blind men called upon to describe it to the king. What would connect the separate languages that each separately describes some part of the elephant with, is, well, THE ELEPHANT. It's a question of mistaken identity, treating one's own language as the physical subject being addresses.

If we somehow made the physical realities we discuss as our common subject then everyone's different way of seeing them would be informative to others, otherwise other languages are pointless or contradictory. I think it's actually quite possible to reorient scientific language to distinguish between physical subjects (beyond our definition) and interpretive subjects with meanings only within the language.

One approach to that is described in my current draft paper on how the sciences and policy languages conflict over whether efficiency constrains or stimulates resource consumption. Stimulus as Constraint I'd be glad to have comments that would help the next draft to be better.

Anonymous said...

Scientists like Charles Hall, Phil Henshaw, Sir John Sulston and the Royal Society’s People and the Planet Working Group have good work to do that is best accomplished by being uncompromisingly honest in the reporting of their research as well as by being unambiguously objective and forthcoming in reporting their findings with regard to the research of others. When honesty and effectiveness are viewed in opposition to one another, honesty must prevail over effectiveness in science. Finding a balance between them is not sufficient. Sacrificing honesty in order to maintain professional effectiveness is inadequate.

With regard to the science of human population dynamics, intellectual honesty appears not to have prevailed over professional effectiveness. That convenient rationalizations in support of effectiveness have been deployed by too many experts who have refused to be fully honest and open about such a vital matter of concern, seem somehow not right. Science is not compatible either with less than the ‘whole truth’, according the lights and best available empirical data we possess, or with the collective avoidance by professionals of research regarding what could be real. Science is an expression of truth, is it not? There can be no room for compromise between honesty and effectiveness where science is concerned.
If faith in the goodness of science is ever lost, then I fear the future of children everywhere, life as we know it, and Earth as a fit place for habitation by coming generations, that we think we are preserving and protecting in our time, could be ruined utterly. Somehow the honesty of science must come to prevail over professional effectiveness and the pernicious silence of too many of ‘the brightest and the best’ on one hand and the specious, intellectually dishonest, deceitful, cascading, ideologically-driven chatter of clever ‘talking heads’, overly educated sycophants or other minions in the mainstream media who selfishly serve the primary interests of self dealing masters of the universe among us on the other.
There is nothing ever insignificant to be gained from science and nothing trivial about truth. This is especially so with regard to science that indicates: human population numbers are a function of food availability (not, definitely not, the other way around) and human population dynamics is essentially similar to the population dynamics of other species. From my perspective, the science tells us something vital about ourselves, our distinctly human creatureliness and our ‘placement’ as the top ranking creature among the living beings on Earth. For all the miraculous and occasionally unique attributes of the human species, the research shows us that the human species is not, definitely not, most adequately or accurately placed “a little lower than angels” in the order of living things. Although such an attractively elevated and self-aggrandizing position for the human species sets human beings apart from other species, this view appears to be a widely shared, consensually validated and culturally-prescribed illusion. Rather human beings are assuredly situated within all that is living on Earth. Homo sapiens is an organism that is an integral part of the natural world, not apart from it. We see science once again ‘cutting’ from under us ‘the pedestal’ upon which we believe stand as we oversee, steward and dominate life on Earth.
Steve Salmony

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