The Living Economy The Living Economy A NEW ECONOMICS IN THE MAKING Edited by Paul Ekins London & New York First published 1986 by Routledge and Kegan Paul, plc This edition published in the Taylor & Francis e-Library, 2005. “To purchase your own copy of this or any of Taylor & Francis or Routledge’s collection of thousands of eBooks please go to www.eBookstore.tandf.co.uk.” © Paul Ekins for The Other Economic Summit (TOES) 1986 All rights reserved. No part of this book may be reprinted or reproduced or utilized in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. British Library Cataloguing in Publication Data The Living Economy: a new economics in the making. 1. Economics I. Ekins, Paul 330 ISBN 0-415-03937-1 Library of Congress Cataloging in Publication Data The Living Economy Collection of papers from The Other Economic Summit (TOES) Bibliography: p. Includes index. 1. Economics 2. Economic development. I. Ekins, Paul. II. The Other Economic Summit (Organization) ISBN 0-203-16906-9 Master e-book ISBN ISBN 0-203-26442-8 (Adobe eReader Format) ISBN 0-415-03937-1 (Print Edition) Dedicated to the memory of E.F.Schumacher, author of Small is Beautiful and father of ‘economics as if people mattered’ CONTENTS FOREWORD BY x CHRISTIAN SCHUMACHER PREFACE AND ACKNOWLEDGMENTS xiii INTRODUCTION 1 PART I THE NEED FOR A NEW ECONOMICS 4 ECONOMIC GROWTH: MEDICINE OR 5 DISEASE? Economic growth: the political economy of resource 7 misallocation Contribution by Edward Barbier The reality of a finite planet 10 Contribution by Herman Daly and Harford Thomas THE SCOURGE OF UNEMPLOYMENT 13 Contribution by David Fleming and Paul Sparrow THE INTERNATIONAL ECONOMIC 15 DISORDER Trickling down and out 16 Contribution by Anila Graham The debt crisis 18 Contribution by Susan George The arms trade 24 Contribution by Tony Humm Health and development 27 Contribution by Mira Shiva INDICATORS OF NO REAL MEANING 31 Contribution by Hazel Henderson, John Lintott and Paul Sparrow vi PART II PUTTING PEOPLE FIRST 40 1 A FRAMEWORK FOR THE FUTURE 41 ‘Human-scale economics: the challenges ahead’ by Manfred Max-Neef 2 A QUESTION OF NEEDS 54 ‘Needs and commodities’ 55 by Jeremy Seabrook Contribution by Christine MacNulty ‘Human need and strategies for social change’ 68 by Len Doyal and Ian Gough 3 THE NATURE OF WORK 80 ‘What comes after full employment?’ 84 by James Robertson 4 IN SEARCH OF SELF-RELIANCE 96 ‘Towards a New Economics: on the theory and 96 practice of self-reliance’ by Johan Galtung 5 HEALTH IS WEALTH 109 Contribution by Peter Draper and Trevor Hancock ‘The mismatch between health and economics’ 113 by James Robertson ‘Demedicalization and possibilities for health’ 121 by John McKnight 6 INDICATORS OF ECONOMIC PROGRESS 128 ‘From Gross to Adjusted National Product’ 132 by Christian Leipert ‘Health-based indicators of economic progress’ 140 by Trevor Hancock ‘Social indicators for popular planning’ 145 by Roy Carr-Hill and John Lintott vii ‘Making the informal economy visible’ 155 by David Ross PART III THE NEW ECONOMICS IN ACTION 167 7 ACCESS TO LAND 170 Contribution by David Bateman and Nic Lampkin, Howard Newby and Hartmut Vogtmann ‘Co-operative land banks’ by 181 Shann Turnbull ‘Land value taxation’ 189 by Fred Harrison 8 FINANCIAL FUTURES 194 Contribution by Michael Linton, Shann Turnbull and David Weston ‘Money as if people mattered’ 204 by David Cadman 9 WORKING LIKE WOMEN 211 ‘Flexible working patterns’ by Sheila Rothwell 10 TAXATION, BENEFITS AND THE BASIC 225 INCOME Contribution by Anne Miller and David Chapman ‘Universalising capital ownership’ 234 by Ward Morehouse 11 INDUSTRIAL PRIORITIES AND 242 TECHNOLOGICAL CHOICE ‘An economic scenario for a conserver-economy’ 243 by Roefie Hueting ‘The Sunrise Seven’ 258 by John Elkington 12 LOCAL ECONOMIC REGENERATION AND 265 CO-OPERATION ‘A new local economic order’ 265 viii by Guy Dauncey ‘What small business experience teaches about 273 economic theory’ by Michael Phillips ‘Co-operation: where the social meets the economic’ 284 by Paul Ekins 13 LEARNING FROM THE SOUTH 290 ‘The Green Belt Movement’ 291 by Wangari Maathai ‘Piece-rate workers’ attempt at self-reliance’ 297 by Ela Bhatt ‘Putting the last first’ 306 by Robert Chambers 14 TRADE AND THE MULTINATIONALS 324 ‘Alternative trading strategies’ 324 by Frances Stewart and Ejaz Ghani ‘Delinking from the world market’ 334 by Wolfgang Sachs ‘The role of corporations’ 345 by Willis Harman CONCLUSION 352 APPENDICES 357 1 The Other Economic Summit conference papers 357 1984 and 1985: details of contributors 2 Relevant addresses 368 3 Steering Committee of The Other Economic 376 Summit 4 Main sponsors of The Other Economic Summit 379 BIBLIOGRAPHY 380 INDEX 393 FIGURES AND TABLES FIGURES 1.1 Total productive system of an industrial society (Three-layer 32 cake with icing) 2.1 Schematic illustration of Doyal and Gough’s theory of 77 human needs 6.1 The transformation from gross to net production returns 134 6.2 The whole economy divided into nine sectors 156 6.3 Scale and rationale of economic units 160 6.4 Sectional approach to scale and rationale 160 10.1 Diagram of present system for creating new productive 236 assets by US corporations TABLES 1.1 Community running costs of unemployment to be accounted 14 for 1.2 International debts and debt service ratios 19 3.1 Four-sector economy 88 6.1 Categories of defensive expenditures 135 6.2 Changing patterns of work and leisure, 1951–81, Great 151 Britain 6.3 Changing patterns of time use, minutes per day, population 152 aged 15+ 10.1 The fairness ratio: income distribution in selected countries 235 11.1 Comparative survey of three scenarios Results at the year 253 2000 (1980=100) 13.1 First values and last realities 309 13.2 Professional preferences 309 13.3 Contrasts in learning and location 320