The Dynamic Economic Framework: From consumers to citizens

The word frame has a strong connotation of immobility to it. Truth is, frameworks are much more dynamic than what the word suggests and one of the most consolidated frames in the world since the 19th century is being shaken by environmental pressures. We are talking about Neoliberal Economy, the frame that has seen humans develop and generate wealth at a rate never seen in past times. For that, thank you Adam Smith, but its time to move on, your system is not compatible with our times.

“… there is nothing more difficult to carry out, nor more doubtful of success, nor more dangerous to handle, than to initiate a new order of things.”

Machiavelli, 1532, The Prince

But what failed? The main misconception was defining human’s well-being (utility of an economic agent is the appropiate concept) by the amount of material goods and services one has accumulated. This is a highly selective generalisation of human motives. The idea that things only have value to the extent that they satisfy people’s desires  is another misinterpretation of humans values (Hamilton, 1997). These ideas that frame Neoliberal Economic system overlook unequal distribution of resources, ethics and the intrinsic value of the environment.

“Sustainability is a profound challenge, which requieres change to basic structures of society.”
Dovers, 2001, Institutions for Sustainability

Most people now a days don’t think as Classical Economy portrayed us, resources are more scarce than ever and environmental sinks are on the edge of collapsing. So Neoclassical Economy doesn’t work for us? We change it to Ecological Economics! (see figure 1). Most Economists will say you can’t change economy, but the fact is, you can. More and more we see decision making diagrams as circles with feedback lines going everywhere rather than linear paths. The idea of looking back and changing the first step you made when solving a problem (framing it) may sound counterproductive and tedious, but it is necessary to move forward.

Screen Shot 2016-08-05 at 2.08.42 PM
Figure 1. From Conventional Economies to Ecological Economies. Hamilton, 1997.

The main point I want to make is that frameworks must continually be revised and changed because they will influence the outcomes, for better or for worst. Changing how we see Economy, considering humans as citizens instead of consumers, will make the difference.


[1] Hamilton, Clive (1997), Foundations of Ecological Economics, in Diesendorf M and Hamilton C (eds), Human Ecology, Human Economy: Ideas for an Ecologically Sustainable Future, Allen and Unwin, Sydney, pp. 35-59

[2] Dovers, Stephen (2001), Institutions for Sustainability, Tela Series, The Australian Conservation Foundation. pp.3-25.


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