Neoclassical economics is characterized by a production function
based only on two factors, work and money capital, while instead
ecological economics acknowledges the existence of natural capital as
a third driving factor. The recognition of natural capital as a key component
of the productive function represents a fundamental transition
since it implies the acceptance of limiting factors constraining the
economic-productive system. According to Costanza (2008) natural
capital is the stock of natural systems that yields a flow of valuable
ecosystem goods or services into the future.
Ecological economists argue that the evolution of human economy
passed from an era in which human-made capital was the limiting
factor for economic development to an era in which the remaining
natural capital has become the real limiting factor. In other words, we
moved from an early successional “empty world” (empty of people
and their artifacts, but full of natural capital) where the emphasis and
rewards were on rapid growth and expansion, cutthroat competition,
and open waste cycles, to a “full world”, where the needs for survival,
whether perceived by decision makers or not, are for qualitative
improvement of the linkages between components (development),
cooperative alliances, and recycled “closed loop” waste flows (Daly,
1991; Costanza et al., 1997; Daly and Farley, 2004).