It is important to distinguish between ecological economics and the particular approach to
environmental economics in most of the literature, which following Beinhocker (2006) can
be called “traditional” environmental economics defined as “the set of concepts and
theories articulated in ... textbooks. It also includes concepts and theories that peerreviewed
surveys claim, or assume, that the field generally agrees on.” (p. 24). Traditional
economics, or the narrower neoclassical economics, is focused on a model of utility
maximisation and the allocation of resources via the price mechanism (Bergh, 2001). It
crucially assumes that all natural services can be converted to money and back again at any
time, i.e. that there are no irreversible effects (Ackerman and Heinzerling, 2004). This is
not the case, so future generations face the risk that they will be deprived of vital resources
if economic growth continues without constraints.
It is important to distinguish between ecological economics and the particular approach toenvironmental economics in most of the literature, which following Beinhocker (2006) canbe called “traditional” environmental economics defined as “the set of concepts andtheories articulated in ... textbooks. It also includes concepts and theories that peerreviewedsurveys claim, or assume, that the field generally agrees on.” (p. 24). Traditionaleconomics, or the narrower neoclassical economics, is focused on a model of utilitymaximisation and the allocation of resources via the price mechanism (Bergh, 2001). Itcrucially assumes that all natural services can be converted to money and back again at anytime, i.e. that there are no irreversible effects (Ackerman and Heinzerling, 2004). This isnot the case, so future generations face the risk that they will be deprived of vital resourcesif economic growth continues without constraints.
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