Planet- and people-centred economic ideas, coming to a city near you
Our first ecological economics special issue, the necessity of climate action amidst a slowing global economy, and a victorious referendum to get polluters to pay in Paris, France
I am delighted to share the Journal of City Climate Policy and Economy’s Special Issue on Ecological Economics, published in partnership between the C40 Centre of City Climate Policy and Economy and the University of Toronto Press. The issue is open-access, and you can read it in full here: it includes a retrospective on Herman Daly’s debates with Robert Solow, Joseph Stiglitz, Jagdish Bhagwati, and Kenneth Arrow (among others), an overview of some potential approaches for cities looking to reduce their material footprint, an introduction to the Wellbeing Economy, original research on the tension between financial influence and sustainability in the governance of water, and much more.
Ecological economics ideas are incredibly relevant to city climate action, but so far research has mostly focused on the global and national dimensions, instead of the urban one. This is why we called for academics, researchers, and practitioners to write about people- and planet-centred economic ideas, and how they could be applied at the city-level.
Here’s an extract from the Foreword to the Special Issue:
Climate change is caused by humanity’s overdependence on and abuse of fossil fuels, around whose exploitation much of the global economy is organised.
Effective climate action requires a deeper understanding of the overconsumption driven by our economic system and of the public and private financial systems that are based on the deep-seated myth that infinite economic growth is possible. The work of ecological economists—and the laws of physics—clearly show this is not the case on a finite planet (Hickel & Kallis, 2020; Jackson & Victor, 2019). Furthermore, this belief hinges on the idea that anything other than growth will inevitably result in a crisis. Any system that falls into a crisis unless its growth is constantly accelerating is dangerously unstable in itself and ecologically damaging.
Yet, the economic assumptions that have informed our governments’ policymaking since World War II are deeply reliant on this idea. At best, they are oblivious to—and at worst, defiant of—the latest scientific understanding of our planetary health.
An urban ecological economics approach that takes into consideration the physical limits of the biosphere, or that prioritises human wellbeing over a generic increase in gross domestic product, is still considered heterodox by mainstream economists. However, as evidenced by the range of contributions in this special issue, interest in these innovative approaches is growing, as is the scientific literature exploring the theory and practice of what a climate-compatible economic system would look like, how we can achieve it, and how cities can lead.
Continue reading…
IMF’s first World Economic Outlook of 2024: keep up climate investment
The International Monetary Fund (IMF) has published a moderately optimistic World Economic Outlook, its quarterly economic update. The IMF hopes that the year ahead will continue to see the global economy recovering from the high inflation of 2022/23 “unscathed”—by which they mean without rising unemployment, rather than without hardships for those affected by the cost of living crisis.
In the report, the IMF calls for fiscal restraint—expecting countries to pare back their pandemic support and energy crisis subsidies— but not for a return to 2010s-style austerity. It highlights that the state of debt-distress that many countries are finding themselves in should not prevent the “space for necessary investment”, including “investment in climate adaptation activities and infrastructure”.
We have already written about how European policymakers are looking at alternative economic perspectives as a way to frame the necessary ecological transition in a wider context of inclusivity and fairer redistribution of wealth and resources. In this sense, the IMF does well in stressing that not all government spending is the same, and that significantly more investment is needed to finance inclusive climate action and climate resilience. Starting in cities is effective from both an economic and climate perspective—and with well-designed policies—from an inclusivity perspective too.
We’ll always have Paris
On Sunday 4 February, residents of Paris, France, voted in favour of tripling the parking fees for sport utility vehicles (SUVs) for non-residents. This move by Mayor of Paris Anne Hidalgo is aimed at tackling the worrying trend that has seen cars becoming larger and heavier (in France, the average weight of a vehicle was 975 kg in 1990 vs 1,233 kg today).
Heavier and larger cars pollute more, take up more public space, and are deadlier when involved in crashes. Without national-level regulation (and more conscious design from car manufacturers), city leadership is required to discourage their use in busy urban areas, protect the health of their residents, and the planet.
Paris is not the first French city to take this kind of action. Last year, Mayor of Lyon Grégory Doucet introduced a new parking policy that combined the principle of polluter pays with progressive taxation, allowing smaller vehicles (less than 1,000 kg) and households on the more modest incomes to pay reduced rates.
Luckily, cities are very good at learning from each other, so—when these policies are shown to bring about the desired effects—we will soon see more like them introduced.
📚 What I am reading
I’m looking forward to reading Not the end of the world by Dr Hannah Ritchie. Working on climate action can be challenging and Dr Ritchie—whose newsletter I would heartily recommend—is consistently great at giving me hope about humanity’s outlook.
For a critique of the book from an ecological economics perspective, I enjoyed Timothée Parrique’s post, in which he disagrees with Dr Ritchie about her dismissal of degrowth as a viable option to rapidly reduce humanity’s pressure on the planet’s ecological boundaries.