They shifted to green markets in 2012 and they did not have a theory of the perfect green market to guide them.
They have gone the route of environmental externality management instead of environmental cost internalization as required by perfect green market theory without having a theory or a plan linking environmental externality management to the road to green markets.
In other words, environmental externality management based markets are not linked to green markets or green market pricing; and therefore they still operate under an envirornmental sustainability gap..
Is environmental externality management a short term cash cow and a long-term environmental nightmare in the making for governments and the world? I think yes, what do you think?
You have raised an interesting question. Externality-based policies still are market-based intervention and could be useful in dealing with that externality. These could be short-term but could also involve for long-term solutions - for example, climate policies in Carbon trading etc. The problem with developing exclusive green markets is that it takes some time to establish a market and operate under typical market systems. I think externality management could evolve into new markets that deal with demands for green markets and technology over time.
Good day Timothy, thank you for taking the time to provide your comment.
The reason I asked the question is that the consequnce(environmental externality) exists and it has always existed because Adam Smith gave us a tratiditional market model with an environmental distortion(the cause) as he assumed enviromental externality neutrality... Externality management means the consequence is the problem, not the cause....do you see?
Traditional market prices are environmentally unfriendly because the pricing mechanism left out the environmental cost of production, the reason why we have been able to produce at lower prices....All because the enviromnental distortion enbedded in Adam Smith's model....Had he gave us green markets, green prices would not had this enviromental distorition as then environmental issues are endogenouse issues reflected in the pricing mechanism....
The move to green markets in 2012 was to correct Adam Smith model and make it environmentally friendly creating a win-win economy-environment partnership....and this requireds environmental cost internalitization....
From 1776 to 1987/Our Common Future the environmental distortion did not matter...,,Nobody questions Adam Smith's externalityd assumptions...and the environmental crisis took shape......
After 1987 the environmental distortion suddenly matters, and matters a lot; and needed to be fixed so Adam Smith's traditional market model could be shift edto green markets....but it can only fbe fixed through environmental cost internalitzation as required by perfect green market theory.....
Surprisingly the mainstream thinkers and economists at the UN /Rio plus 20 shifted to green markets, green growth, and green economies in 2012 and then instead of going environmental cost internalization they went externality management.....taking a distortion as an enviromental externality led market failure when the only thing that needed to be done was "environmental cost internalization"...
if they went to non-green market action to deal with green market problems because of the green market paradigm shift knowledge gap....then that is fine....THomas Kuhn would have understood this as normal behavior when there is a paradigm shift...a shift from traditonal market to green markets in this case...
But iknowingly they have gone as you seem to imply externality management instead of green market management.....Because it is easier.......that is a full voiolation of the theory-practice consistency sending the message that non-science based action is justififiable becassue it is easier to implement knowing that it is not directly connected to the issue we are supposed to be traying to solve, the environmental crisis....
Thank you for your comment and I think you may find the following article interesting:
Have a nice day
Perfect Green Markets vrs Dwarf Green Markets: Did We Start Trying to Solve the Environmental Crisis in 2012 With the Wrong Green Foot? If Yes, How Can This Situation Be Corrected?
https://www.researchgate.net/publication/305994500_Perfect_Green_Markets_vrs_Dwarf_Green_Markets_Did_We_Start_Trying_to_Solve_the_Environmental_Crisis_in_2012_With_the_Wrong_Green_Foot_If_Yes_How_Can_This_Situation_Be_Corrected
Article Perfect Green Markets vrs Dwarf Green Markets: Did We Start ...
The issue of environmental externality management is an advocacy of the market economic theory grounded on the basic principle of Ayn Rand's advocacy of egoism as a virtue. This principle pervades in the environmental externality management advocates. This pervasive advocacy will justify hidden interests of the emerging entrepreneurs of environmental externality management. I agree with your observation that such advocacy sans/ without a theoretical basis is nothing but a configuration of profit motive interests.
Yes, is is mind blogging....
A climate change action program based on science and concensus implemented through non-green market tools and theory......
I am still open to the possibliity that they went the non-science, non free market way since 2012 soon after the paradigm shift Rio +20 with these environmental externality management framework because of the green market paradigm shift knowledge gap associated with the paradig shift; and therefore this is justifiable academic blindness as Tomas Kuhn would have expected....freom the inside you only see an externality led market failure, from the outside you see the embedded enviromnental distortion.....so under paradigm shift outsiders are the once who can see that the theory does not match the practice and why....
However, if they decided to address the environmental crisis after shifting to green market in 2012 throhgh non-green market tools telling us we were in a green market, green economy, and green growth world , then that is or would be purposive academic blindness as they should have been able to see that they were movimng away from the scientifice method. leaving the free market world behind perfect green market thinking and moving towards a non-free market world under dwarf green market action....
Are non-green market tools better than green markets to deal with green market issues?....If they think yes, then we have to say goodby to the scientific method in economics and all the fields associated with economics......That is the dilemma that is coming before us right now....
I do not think so, certainly not generally. The obvious counter example is CO2 emissions. Taxation of the sale of fossil fuels can hardly be said to be nightmare for a government. I would in any case comment that there is no such a thing as a perfect green market.
RediscoveringSustainability.org.uk
Counter example of what? If you read my question and comments carefully Aart and read your comment you either are contradicting yourself or you do not understand the heart of the question or the dilemma.....Taxation it is a cash cow, not connected to the environmental externality; and therefore unconnected to green markets as production and consumption continue the environmental sustaibility gap will keep expanding under environmental externality management.....the environmental crisis will become even more acute in the year to come......
CO2 emissions( THE CONSEQUENCE) is the simplest example of why Adam Smith's model producing a full environmental distortion(THE CAUSE) since 1776 gave shape to the environmental crisis of today...as the cost of polluting was left outside the pricing mechanism of the traditional market a rational decision maker, firm or consumer would produce or consume as much as they can to make as much money as you can...Polluting is free because Adam Smith's assumed environmental externality neutrality...Do you think we had the same environmental problem of today if Adam Smith would have proposed "green markets", environmentally friendly markets? I do not think so A green price with structure GP = P + EM would have provide green signal to green markets to produce and consume environmentally friendly goods....
Good day everyone
I am sharing here this article unpublished and you can use it as food for thoughts:
Is Environmental Externality Management a Correction of Adam Smith’s Model to Make It Environmentally Friendly and Shift it Towards Green Markets or Is It a Distortion on Top of Another Distortion?
https://www.researchgate.net/publication/309463581_Is_Environmental_Externality_Management_a_Correction_of_Adam_Smith%27s_Model_to_Make_It_Environmentally_Friendly_and_Shift_it_Towards_Green_Markets_or_Is_It_a_Distortion_on_Top_of_Another_Distortion
Have a nice day
Article Is Environmental Externality Management a Correction of Adam...
Very good response from colleagues here. For external environmental externality management crop insurance can cover the risk in agriculture.
I fully agree with your opinion sir Malhotra. Environmental Externality Management is one of the market strategies to protect not the environment but the invisible hand of an entrepreneur to create more demand for such environmental externality. This is another form of distortion of an already existing distortions.
Dear friends, here sharing my most recent article which I trust you may find interesting in terms of food for thoughts:
If Going From Free Markets to Non-Free Markets is the Way to Go: Does This Means the End of Rational Decision Making Thinking or Is This Just a Temporary Block of a Perfect Paradigm Shift to Green Markets?
https://www.researchgate.net/publication/312092336_If_Going_From_Free_Markets_to_Non-Free_Markets_is_the_Way_to_Go_Does_This_Means_the_End_of_Rational_Decision_Making_Thinking_or_Is_This_Just_a_Temporary_Block_of_a_Perfect_Paradigm_Shift_to_Green_Mark
Article If Going From Free Markets to Non-Free Markets is the Way to...
The simple reason Adam Smith assumed external environmental neutrality was that (a) he had no way of measuring it and (b) if he put it in capitalism wouldn't work. I don't think there is any simpler system of transferring wealth from the poor to the rich while all the time purporting to do precisely the reverse. Sheer brilliance - and the entire Earth is now paying the price.
Dear Tony, thank for your comment.
When I started thinking about why Adam Smith assumed these neutralities and apparently nobody questioned the long term risk of that approach since 1776 until 1987 when the bruntland commission indicated that business as usual was no longer possible and needed corrections....
If Adam Smith would have added social and environmental margins then there would not have been traditional markets, but sustainability markets from the beginning, a point of low environmental and social pollution as compared as today;
-
In short,
a) Adam Smith sent us towards an unsustainable market development route in the very long terms as we know today in terms environmental pollution and social poverty
Did Adam Smith Miss the Chance to State the Goal and Structure of Sustainability Markets in His Time? If Yes, Which Could Be Some of the Possible Reasons Behind That?
https://www.researchgate.net/publication/286625136_Did_Adam_Smith_Miss_the_Chance_to_State_the_Goal_and_Structure_of_Sustainability_Markets_in_His_Time_If_Yes_Which_Could_Be_Some_of_the_Possible_Reasons_Behind_That
-
b) now we need to correct the mess first highligted in the Our Common Future/1987 and add the missing margins to bring it consistent with sustainability rules.
Complex and Man-made Markets: Are We Currently Approaching Sustainability in a Backward and More Chaotic Way in Terms of Economic Thinking?
https://www.researchgate.net/publication/281277199_Complex_and_Man-made_Markets_Are_We_Currently_Approaching_Sustainability_in_a_Backward_and_More_Chaotic_Way_in_Terms_of_Economic_Thinking
What If Markets Have Always Been Distorted? Would It Then Be a Good Fix to Add Fair Trade Margins to Correct Distorted Agricultural Market Prices?.
https://www.researchgate.net/publication/281244562_What_If_Markets_Have_Always_Been_Distorted_Would_It_Then_Be_a_Good_Fix_to_Add_Fair_Trade_Margins_to_Correct_Distorted_Agricultural_Market_Prices
-
c) and We know today, both Adam Smith and Karl Marx made similar over simplification mistakes or got it wrong.
Adam Smith and Karl Marx Under the Sustainability Eye: Pointing Out and Comparing the Sustainability Gaps Behind these Two Great Simplification Failures
https://www.researchgate.net/publication/299885202_Adam_Smith_and_Karl_Marx_Under_the_Sustainability_Eye_Pointing_Out_and_Comparing_the_Sustainability_Gaps_Behind_these_Two_Great_Simplification_Failures
Those interested in green market thinking may find the following article full of food for thoughts
From Traditional Markets to Green Markets: A Look at Markets Under Perfect Green Market Competition
https://www.researchgate.net/publication/330617155_From_Traditional_Markets_to_Green_Markets_A_Look_at_Markets_Under_Perfect_Green_Market_Competition
https://www.researchgate.net/publication/330701187_From_Traditional_Markets_to_Green_Markets_A_Look_at_Markets_Under_Perfect_Green_Market_Competition
I like your reasoning Lucio. Maybe it is the obsession with markets that is our downfall, and not the issues over the type of market we use. Markets exist because we have invented money which gives us the illusion that everything can be expressed in terms of a 'price' or 'cost' and it is the job of the 'market' to maximise something or other expressed in terms of this money - though just what it is that is being maximised is rarely well defined or just called 'profit'. If that is all we have managed to achieve in several hundred elapsed years, and countless millions of person-years, then the future looks bleak indeed. On the brighter side - I wish you well in your researches!
Tony, thank you for comment.
-
From 1776 when Adam Smith proposed the perfect market and profit, nobody has proposed anything new; and nobody criticized it until 1987 when the bruntland commission pointed out that facts like extreme poverty and extreme environmental declined were signs it needed to be fixed....
-
My writings in general terms have focused from the beginning to show step by step that Adam Smith got it wrong and because of that we have been living under distorted markets. The specific paper I shared above is aimed at showing how traditional perfect market theory can be greened and at indirectly make the point that had Adam Smith not assumed environmental externality neutrality he would have proposed the theory of the perfect green market.....
-
Have a nice day!
Sharing article just published
The Flipping of Traditional Economic Thinking: Contrasting the Working of Dwarf Green Market Thinking with that of Green Market Thinking to Highlight Main Differences and Implications
https://www.researchgate.net/publication/334535200_The_Flipping_of_Traditional_Economic_Thinking_Contrasting_the_Working_of_Dwarf_Green_Market_Thinking_with_that_of_Green_Market_Thinking_to_Highlight_Main_Differences_and_Implications
- Badges
- Science topic
- Similar topics
- Geoscience
- Atmospheric Sciences
- Climate Science
- Climate Change