Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist
By Kate Raworth
Book notes
“As the ingenious twentieth-century inventor Buckminster Fuller once said, ‘You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.’” p.4
“What if we started economics not with its long-established theories, but with humanity’s long-term goals, and then sought out the economic thinking that would enable us to achieve them?” p.10
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Communicating big ideas successfully to the masses through visuals:
“The learned few ... were required to read the Bible in Latin ... In contrast, the illiterate masses were taught the Bible’s stories in pictures ... [e.g] stained-glass windows. It turned out to be a highly successful mass communications strategy.” p.19
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“... sociologist Karl Mannheim whose observation in the late 1920s that, ‘every point of view is particular to a social situation’ ... we each have a ‘worldview’ which acts as the lens through which we interpret the world.” p.22
“Pre-analytic vision. Worldview. Paradigm. Frame. These are cousin concepts. What matters more than the one you choose to use is to realise that you have one in the first place, because then you have the power to question and change it.” p.22
“[says] George Lakoff, it is absolutely essential to have a compelling alternative frame if the old one is ever to be debunked.” p.23
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“the impact the image had in fostering new ways of thinking: it helped to reinvigorate old debates and instigate new ones, while offering bag a positive vision of an economic future worth striving for.” p.24
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Action research, creating visions of the future, potential:
“But the time for mere critique is past, which is why the focus here is on creating new images that capture the essential principles to guide us now.” p.25
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“For the twenty-first century a far bigger goal is needed [than GDP]: meeting the human rights of every person within the means of our life-giving planet. ... Instead of pursuing ever-increasing GDP, it is tome to discover how to thrive in balance.” p.25-28
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“Today we have economies that need to grow, whether or not they make us thrive: what we need are economies that make us thrive, whether or not they grow.” p.30
“Given the speed, scale and uncertainty of change that we face in coming years, it would be foolhardy to attempt to prescribe now all the policies and institutions that will be fit for the future: the coming generation of thinkers and doers will be far better placed to experiment and discover what works as the context continually changes. What we can do now - and must do well - is bring together the best of the emerging ideas, and so create a new economic mindset that is never set but always evolving.” p.30
CHAPTER 1 (audio)
- economics began being value-led - to ensure each person is looked after
- Then goals and values were removed to make it objective (I think)
- Then other values embedded themselves in from assumptions (assumptions that people spend money on things to make them happy, and that people want more rather than less so increased income and output growth was assumed to be a positive ??)
- although most things we value we can’t buy
- the purpose of economics has been forgotten/ignored - we don’t talk about it, GDP growth has hijacked it and blinded us all
Kuznuts recognised disadvantages of GNP - e.g. only market value, not household etc.
there have been attempts since 1819(?) to change the goal to be human welfare/needs/flourishing
we can’t have policies addressing planetary boundaries individual as they are all connected:
“their interconnectedness demands that they each be understood as part of a complex socio-ecological system and hence be addressed within a greater whole.”
“Human thriving depends on planetary thriving.”
- ‘onwards and upwards’ isn’t necessarily best definition for ‘progress’
- Coming into thriving balance of Doughnut - “good is in balance”
CHAPTER 4
‘problems of organised complexity’ - lots of interrelated variables - complex but organised system/whole
1970s: ‘Complexity science’ - “how relationships between the many parts of a system shape the behaviour of the whole”
“we can all learn, through training and experience, to be better ‘systems thinkers’.
SYSTEMS THINKING:
- stocks and flows - elements - things that can be built up or run down - e.g. water in a bath, people/population on the planet)
- Feedback Loops - interconnections - reinforcing/positive (keeps systems moving) and balancing/negative (prevents systems imploding, brings stability)
- interaction of different types of feedback loops creates complexity and emergent behaviour of systems
- Delays - of stocks and flows ?
complex and adaptive systems emerge from above interacting - always evolving
“Orit Gal, ‘complexity theory teaches us that major events are the manifestation of maturing and converging underlying trends: they reflect change that has already occurred within the system.’” p.141
- sometimes we are shocked by what appears to be extreme and sudden crises (e.g. Trump) when in fact there have been interconnecting signals and shifts emerging for a while - although they may seem insignificant independently, together they create a shift
- scary, HOWEVER can also work for positive change - many small change efforts interlinking to create collective impact (basically what SFS is about)
“[these events are] visible tipping points that result from slowly accumulated pressure in the system” p.141
❤️ On ‘externalities’: - “incidental effects felt by people who were not involved in the transactions that produced them” p.143 - Herman Daly: “‘we classify as “external” costs for no better reason than because we have made no provision for them in our economic theories.’” - John Sterman: “‘There are no side effects - just effects,’ ... notion of side effects is just ‘a sign that the boundaries of our mental models are too narrow, our time horizons are too short.’” - we must address these ‘externalities’ to create “an economy that enables us all to thrive” - ignoring these has resulted in social and ecological crises today “due to the scale and interconnectedness of the global economy.”
old Economics places assumptions that are not correct in the real world- many other variables and factors impacting globally
‘Success to the successful dynamic’ reinforcing feedback loop - we need to intervene and weaken this loop to change the outcome
Inequality: powerful reinforcing feedbacks - “virtuous cycles of wealth and vicious cycles of poverty” p.148 - exacerbate inequalities
fun fact about Monopoly originally called ‘The Landlord’s Game’, designed time reveal the injustice of concentrated property ownership (those with property earn more money etc.) - not to celebrate it
distribution- sugarscape example - inequality emerges from complex dynamics (not just our talent and merit, but complex dynamics that emerge from interconnections as diverse agents evolve collectively)
‘External’ effects “could build up as feedback and disrupt the economic system that first generated them.” p.152 - so we must recognise the economy is embedded in the biosphere
- cool example of C-Roads mock climate change negotiations with least developed country leaders on the floor to show power dynamics
‘avoiding collapse’ interesting how society and environmental degradation interlink p.154
Required transformation to avoid collapse: “Today’s economy is divisive and degenerative by default. Tomorrow’s economy must be distributive and regenerative by design.” p.156 - plus more comments explaining this
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GARDENING
Liu & Hanauer: “moving from ‘machinebrain’ to ‘garden brain’ thinking calls for a simultaneous shift away from believing that things will self-regulate to realising that things need stewarding. ‘To be a gardener is not to let nature take its course; it is to tend,’ they write, ‘Gardeners don’t make plants grow but they do create conditions where plants can thrive and they do make judgements about what should and shouldn’t be in the garden.’” p.158
embrace evolution - instead of aiming to “predict and control the economy’s behaviour” - natural selection method - “diversify-select-amplify” - “set up small-scale policy experiments to test out a variety of interventions, put a stop to the ones that don’t work well, and scale up those that do.” p.158 - we don’t know for sure what will work but we must be able to adapt as we find out along the way (system must be designed so it is able to change course easily and rapidly) - Elinor ostrom - “if complex systems evolve through their innovations and deviations ... that gives added importance to novel initiatives ... these experiments are at ... the evolving edge - of economic transformation” p.158
LEVERAGE POINTS p.159
“places in a complex system where making a small change in one thing can lead to a big change in everything.” p.159
FOR SFS, ask: “how did we get here, where are we headed, and what is still working well?” - get the best of the system, pay attention to existing value before charging in to create change
Meadows noted that “effective systems tend to have three properties - healthy hierarchy, self-organisation and resilience - and so should be stewarded to enable these characteristics to emerge.” p.159
HH - “when nested systems serve the greater whole of which they are a part.”
S-O - “born out of a system’s capacity to make its own structures more complex” e.g. growing social movement, SFS enabling access to networks, knowledge
R - “emerges out of a systems ability to endure and bounce back from stress ... [achieved by] building diversity and redundancy into economic structures” p.160
- whereas old/equilibrium economics focused on ‘maximising efficiency’ and overlooked resulting vulnerability
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ETHICS - just as doctors have a code of ethics (as they intervene in a complex system that affects other people’s lives), so should economists - gives 4 suggestions: act in service, respect autonomy, be prudential, work with humility - p.161
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“‘The future can’t be predicted,’ wrote Donella Meadows, ‘but it can be envisioned and brought lovingly into being.’” p.162 - PLUS MORE on this page !! - Links to shared vision, gardening/tending metaphors
CHAPTER NURTURE
- model of man has become model FOR man
- economic theory became true because people shaped their behaviour to it as if it were true
- me: we shift our behaviour towards a shared vision, as if it is true
- Mentions consumer/citizen language and how it affects our behaviour
- consumer limits our actions to that within the market (buying)
“The portrait we paint of ourselves clearly shapes who we become”
Explains 5 shifts of new economic portrait (e.g. from self-interest to social)
Planted [15 Jan 2021 at 23:28]
Last tended [26 Jan 2021 at 15:06]