How to deliver economic success
Transitioning to a circular economy:
There continues to be a dangerously worrying gap between the global acknowledgement of the urgent need to change course in order to tackle the climate crisis on the one hand, and the continued call for ‘economic growth’ on the other many governments- certainly the UK Government- are failing to meet even the limited commitments to tackling climate change does not even make it into the Government’s top five pledges.
Which instead focus on reducing inflation, increasing growth, reducing national debt, reducing health waiting times and ‘stopping the boats’ that carry migrants to the country _The UK Government claims that these are the ‘people’s priorities’ presumably as a reason why the Government won’t prioritise the climate crisis is not a priority for people.
sition? Entrepreneurial ecosystems for a circular economy’ Ebel Berghuis, Derk Loorbach, Anne van Vulpen, Martijn Verkuijil, Claudia van Orden and Rachel Greer consider the idea of ‘circular ecosystems; which they argue could create role models in the transition to a circular economy-inspiring and motivating entrepreneurs, and thus having a transformative effect in the transition to environmental and social sustainability. The four local examples they investigate are small-scale, and are not yet examples of a circular economy, but, they argue, ‘ecosystems are not static entities’ and they ‘are on the move, as this research demonstrates.
environmental and social sustainability:
A full-blown case for environmental and social sustainability made by jon D. Erickson in his book, The Progress illusion-Reclaiming Our Future from the Fairytale of Economics (Island Press, Washington, 2022). In my review article; The need for environment and social sustainability-but how to make the case, and how to achieve it?; I reflect on the above problem, of governments committing to taking action to tackle climate change, and then carrying on in the same old way of advocating more economic growth, as if that were an end in itself, rather than the quality of life-not to mention the continuation of human life on the planet, a planet that we are making less and habitable.
To be fair to politicians, they are mostly driven by what they think will be popular with the electorate, the media, and their donors-so as well as putting pressure on politicians directly, we do need to continue seeking to influence the electorate and the media, and if we cannot influence the donors, then at least seek to limit the damage that they do. On all these fronts, economists have a role to play.
Economic Development:
In ‘Does infrastructure Development Matter for the Shadow Economy in African Countries?; Paul Ningaye and lsaac Ketu make the interesting observation that governments tend to try to suppress the shadow or informal economy, seeking to ensure that economic activity takes place within the formal economy. There are good reasons for this, in terms of ensuring that health and safety and other.
Regulatory measures are applied, the law is obeyed, taxes are paid, and so on. However, Ningaye and ketu also observe that these attempts to suppress the shadow economy have tended to be unsuccessful. They argue that it would be better to provide the sort of onfrastructure that all
Economic activity requires-whether formal or informal. This would do two things. Firstly, it would assist informal economic activity.
(as well as formal economic activity), and this would be beneficial in terms of delivering the goods and services required. And secondly that economic activity will tend to then move towards and into the formal economy over time, so that perhaps ironically, this may be the best way of achieving the aim of moving economic activity from the informal into the formal economy.
Conclusion:
As described above, several of the papers published in this issue report research results that demonstrate the importance for economic activity variously of infrastructure provision, the quality of institutions, and of gender equality. All of this is entirely consistent with the need for social and environmental sustainability. But we do need to ensure that this need for social and environmental sustainability remains at the forefront when designing and investing in that infrastructure, or when investing in enhancing the quality of institutions. We also need governments to make tackling the climate crises a priority- and to deliver on the commitments they have already made.