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Clive L. Spash

Ecological Economics at the Cross-roads

neglect, apparent within environmental economics for sometime, has been to regard politicians and the political process as barriers to rational policy development.

At the same time, in areas where environmental economics has been regarded as suscepti- ble to criticism, for failing to address certain issues, the models have been extended. For exam- ple, environmental valuation methods have moved far from their original concentration on the direct use values of mainstream micro-economics into areas where questions relating to future generations and the existence of species are discussed. Those versed in the theoretical limits of neo-classical models have tended to regard these extensions into foreign territory as ill-advised and beyond the proper remit of economists. Thus, contingent valuation studies are attacked from within environmental economics as failing to conform to the assumption of the free market (e.g., no arbitrage) and being based upon stated, as opposed to revealed, preferences. Yet, by persist- ing within the relatively secure confines of mainstream neo-classical theor , environmental economics must then confine the terms of debate and so remain largely unable to adequately address or even consider central issues of concern for environmental policy. For example, con- cerns over the long term impact of environmental pollution are inadequately addressed as techni- cal issues about the appropriate discount rate, while the assumption that intergenerational equity can be captured within a specific model of preference utilitarianism precludes central aspects of the ethical debate (see Spash, 1993). Thus, the requirements of neo-classical theory come into conflict with the concerns raised by environmental issues.

In order for environmental economics to maintain a position of good standing within economics requires recruiting those with strong mathematical skills and a theoretical mind-set. Those concerned with practical conservation and ecosystems management who lack that theo- retical interest will therefore be discourage from pursuing environmental economics as a method to advance their understanding of economy-environment interactions, and are likely to seek more direct routes to pursue their environmental concerns. For example, one of the latest trends in economics has been for game theoretic approaches which emphasise mathematical skills. Game theory applications to environmental issues seem to have been boosted by the availability of arms negotiations models developed during the cold war and have spread to other environmental subjects such as international relations (see Patterson, 1996). While perhaps academically satis- fying, this preoccupation seems no more likely to help reduce environmental problems than it did

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