Why it's time for 'Doughnut Economics' | Kate Raworth | TEDxAthens

Summary

In this thought-provoking talk, the speaker reflects on their early desire to change the world and the limitations of traditional economics. They critique the standard economic models for ignoring environmental impact, unpaid labor, and wealth inequality. Through personal experiences, including working with communities and campaigning for Oxfam, the speaker advocates for a new economic mindset that centers on human well-being within the planet's ecological limits. They introduce the 'Doughnut' model as a framework for balancing social needs and environmental sustainability, calling for a transformation in economics education and policy.

Takeaways

• 🌍 The speaker emphasizes the importance of rethinking economics to focus on human well-being and planetary boundaries.
• 📚 Traditional economic models, like the circular flow of goods and money, ignore key factors such as environmental impact, unpaid care work, and inequality.
• 💡 The speaker criticizes mainstream economics for sidelining environmental sustainability, unpaid work, collaborative commons, and wealth disparities.
• 👨‍👩‍👧 Unpaid care work, particularly by women in Sub-Saharan Africa and South Asia, is undervalued in traditional economic models, yet it's crucial for society's survival.
• 🌞 The real flow in the economy isn't just money—it's energy, particularly from the sun, which sustains life and must be used sustainably.
• 🤝 Collaborative, non-monetary activities like Wikipedia and open online education showcase the power of collective action outside traditional economics.
• 📉 The gap between ordinary households and the wealthy has widened, with many people suffering from stagnating wages while corporations and the rich accumulate wealth and power.
• 🍩 The 'doughnut' model represents a balance between meeting human rights and staying within planetary boundaries, serving as a compass for 21st-century economic thinking.
• 🌱 Current economic development has failed both socially and environmentally, with millions in poverty and significant planetary boundaries already exceeded.
• ✏️ The speaker calls for a new generation of economists to challenge outdated models and adopt a more holistic approach that includes social and environmental considerations.

Q & A

What did the speaker initially believe was the language needed to change the world?

The speaker initially believed that the language of public policy and economics was needed to change the world.

Why did the speaker feel that traditional economic theories were inadequate?

The speaker felt that traditional economic theories sidelined or ignored critical issues such as the environment, unpaid labor, and wealth inequality, which were the things she actually cared about.

What is the significance of the 'circular flow of goods and money' diagram in economics?

The 'circular flow of goods and money' diagram is a fundamental concept in macro-economic analysis. It shows how households provide labor and capital to firms in exchange for wages and dividends, and how these are spent on goods and services. It is used to measure economic growth.

What are the four fundamental flaws of the circular flow diagram, according to the speaker?

The four flaws are: 1) The economy is not isolated but deeply embedded in the environment; 2) It ignores unpaid labor, especially caregiving work; 3) It overlooks value created through cooperation and collaboration outside of monetary exchanges; 4) It hides the growing inequality in wages and wealth, and how this affects power in the economy.

How does the speaker critique the treatment of unpaid care work in economics?

The speaker highlights that mainstream economics ignores the unpaid care work, mostly done by women, such as raising children and carrying water and firewood in many parts of the world, which keeps families and communities alive without compensation.

What does the speaker mean by 'collaborative commons' and why is it important?

The 'collaborative commons' refers to the value created through cooperation without monetary exchange, such as babysitting or creating free educational resources online. It is important because it represents a dynamic part of the modern economy that traditional economic models overlook.

What is the speaker's proposed alternative to measuring progress through economic growth?

The speaker suggests that instead of measuring progress solely through economic growth, we should focus on achieving balance between meeting human needs and protecting the planet's life-support systems, symbolized by the doughnut model.

What does the speaker mean by the 'doughnut' model?

The doughnut model represents a framework where humanity must live within two boundaries: an inner ring ensuring that everyone has the resources to meet their human rights (social foundation), and an outer ring representing the environmental limits of the planet (environmental ceiling).

What are the challenges humanity faces in achieving the balance described by the doughnut model?

Humanity faces the challenge of lifting people out of poverty while staying within planetary boundaries, as millions of people still lack basic resources, and we are exceeding environmental limits in areas like climate change, nitrogen use, and biodiversity loss.

What role does the speaker believe future economists should play?

The speaker believes future economists should focus on designing markets, regulations, and financial systems that help humanity live within the safe and just space between social and planetary boundaries, rather than prioritizing economic growth alone.