Читать книгу The New Environmental Economics - Eloi Laurent - Страница 15

For Rodrik (2016),¹⁰ modern economics would be different from (and allegedly superior to) other social sciences by its mastery of formal models. Twentieth-century economics would be remarkable for the gradual improvement of its quantitative techniques, building on the invention of the social statistics (by Quetelet) and mathematical formalization (by Cournot), to develop econometrics (Cowles commission), game theory (von Neumann) up to computational and big data economics today. In reality, the question of instruments appears secondary in the constitution of twentieth-century economics. The real rupture is not formal but substantial: it is the break with philosophy, ethics, and justice.

While, as we have just seen, issues of distribution and principles of justice were at the heart of the work of the founding fathers of what has long been called for a good reason “political economy,” they have been marginalized and in the end almost forgotten in the course of the last century. This move away from justice by neo-classical economics was compounded by a focus on short-term policy by its most formidable opponent: Keynesian economics. Let us study these two counter-revolutions in turn.

To begin with, twentieth-century neo-classical economics forgot about inequality. Three key moments marked that reversal. First, it was the admission in 1887 of Charles Dunbar, who viewed economics as a science that should stay clear of ethical considerations, into the American Economic Association (founded in 1885). Dunbar would become AEA’s second President, taking over Richard T. Ely, a progressive who lamented the “contradiction between things as they are and our social ideal.” Second, the development of welfare theorems by Léon Walras in 1920 and the definition of optimality by Vilfredo Pareto in 1930 ended up conflating productive and distributional issues, abandoning inter-personal comparisons and limiting justice policy to the hypothetical possibility – but seldom the reality – of compensation of the “losers” by the “winners” on the market. Finally, the “great dilemma” posited by Arthur Okun between equity and efficiency in the 1970s – the former being assimilated as a loss in terms of the latter – separated even more mainstream economics from distributional concerns.

Hence, in the course of a century, neo-classical economics offered three possible options for considering justice: to deny it, to assume it, and finally to trade it off. In his Richard T. Ely lecture, labor economist Finis Welch went as far as to engage in a reasoned and passionate “defense of inequality,” arguing that: “All economic science proceeds from inequalities.”¹¹

This defense of inequality in the name of efficiency is, simply put, a serious mistake. Fundamentally, inequality is not just unfair: it is both inefficient and unsustainable. Numerous scholars have been working in the last two decades to demonstrate that the current income inequality crisis (a detailed picture of which can be found in the recently released World Inequality Report 2018)¹² hinders progress in key dimensions of human well-being and economic dynamism. Wilkinson and Pickett¹³ have shown that higher income inequality translates into lower physical and health attainments for US states and comparable countries at the international level (income inequality increasing the prevalence of obesity, drug abuse, stress, mental illness).¹⁴ Stiglitz¹⁵ has extended the logic of the argument to show how income inequality favors rents to the detriment of innovation and gradually plagues economic development.

Inequality is not just detrimental to current well-being but affects both resilience (collective resistance to shocks) and sustainability (understood as the long-term horizon of human well-being, that must be compatible with the limits of the biosphere). The seminal work of the late Elinor Ostrom¹⁶ can be understood as drawing a connection between equality and the ability of communities around the world to organize efficiently in order to exploit natural resources sustainably and to resist ecological shocks such as climate change. This line of analysis has been extended to show that, through several other channels, inequality harms sustainability¹⁷ (an issue we will explore in detail in Chapter 10).

Finally, the idea that self-interest and efficiency are the key incentives of human behaviors is deeply unconvincing. Amartya Sen showed that humans look much more like “rational fools” than Homo œconomicus while the quest for fairness appears to be a much more powerful incentive than the pursuit of efficiency. Justice is neither a by-product, a collateral benefit, nor an instrument of efficiency: It is the core demand of humans everywhere on the planet.

In fact, inequality economics has made a noted comeback in the last fifteen years, contrasting with its eclipse from academic and policy debates between the late 1970s and early 2000s (the critical and popular global success of Thomas Piketty’s Capital in the 21st Century, that documents the contemporary rise in income and wealth inequality, being the most visible sign of this renewed interest). Two scholars have been trailblazers in this renewal: Amartya Sen, who has renewed theories of justice, and Anthony Atkinson, who has revisited the empirical measurement of inequality, both lines of work putting back distributional issues at the center of economics, where they were in the eighteenth and nineteenth centuries before their recent eclipse.

But neo-classical economics’ turn away from distributional issues and justice concerns was not the only blind spot in twentieth-century economics. Keynesian economics, while arguing for justice, largely forgot about the long run. In his General Theory (1936), a book that laid the foundations of modern macroeconomic analysis, Keynes made no mystery of his commitment to equality: “The outstanding faults of the economic society in which we live are its failure to provide for full employment and its arbitrary and inequitable distribution of wealth and incomes.” But, in an earlier text, A Tract on Monetary Reform (1923), he was equally clear about his focus on short-term economic analysis: “The long run is a misleading guide to current affairs. In the long run we are all dead.” In this implicit attack on Ricardo, Keynes wanted to direct policy-makers’ attention to here and now social predicament and imbalances rather than the long-run equilibrium posited by neo-classical models. But in doing so, he also laid the ground for a disregard of environmental concerns in the name of short-term job creation and purchasing power increase, pitting prosperity against posterity. This alleged trade-off between social and environmental goals remains to this day one of the most solid obstacles to ambitious environmental policy. And yet, as the impact of climate change on human health around the world makes clear, in the age of ecological crises of which Keynes had no conscience or intuition, it is the short term that has become, in truth, a bad compass of current affairs.

In all fairness, Keynes did try to grasp long-run issues, most notably in his “Economic possibilities for our grandchildren” essay (1930). In this visionary text, Keynes predicts the spectacular increase of living standards in the twentieth century and equates it with the fact that, as he put it, “mankind” would be “solving its economic problem.” But he was, here again, deeply mistaken in arguing that “for the first time since his creation man will be faced with his real, his permanent problem – how to use his freedom from pressing economic cares, how to occupy the leisure, which science and compound interest will have won for him, to live wisely and agreeably and well.” Alas, the “real and permanent” problem of humankind – to take good care of its habitat – is only getting worse. Actually, humankind has not solved its economic problem because it has not solved its ecological problem.