Economic theories, though social constructions, can reflect reality to varying degrees. In the face of dire environmental challenges, adopting a realistic theory is key to the survival of global civilization. The neoliberal emphasis on limitless growth and monetary flows, a relic of nineteenth century thinking, abstracts away from biological conditions. By contrast, ecological economics—as distinct from environmental economics, which remains wedded to the neoliberal growth paradigm—understands the economy as a subsystem of the ecosphere and envisions a steady-state economy embedded within natural constraints. Achieving this equitably will require significant redistribution of wealth and income, reduction of material throughput, and a transition away from fossil fuels. Although the neoliberal paradigm remains dominant, its lack of fitness to current realities gives hope that an ecological alternative could ascend.
Read the Paper