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Capitalism, Cooperation and The Anthropocene

Capitalism, Cooperation and The Anthropocene. Joshua Farley Community Development and Applied Economics Gund Institute for Ecological Economics University of Vermont. Economies as Evolutionary Systems. Hunter gatherer economies (pleistocene) Accumulation = death

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Capitalism, Cooperation and The Anthropocene

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  1. Capitalism, Cooperation and The Anthropocene Joshua Farley Community Development and Applied Economics Gund Institute for Ecological Economics University of Vermont

  2. Economies as Evolutionary Systems • Hunter gatherer economies (pleistocene) • Accumulation = death • Agricultural economies (Holocene) • Property rights, division of labor, political hierarchy • Population density, knowledge, and rate of change

  3. Economies as Evolutionary Systems • Industrial economics (Dawn of anthropocene) • Fossil fuels, non-renewables • Competition • Growth • Financial economics (anthropocene) • Profound change in our lifetimes • Price from negative to positive feedback loops • Redistribution

  4. Societal Challenges in the Anthropocene Just and sustainable degrowth

  5. Societal Challenges in the Anthropocene Marginal market costs (Market supply curve) Poor people have no demand

  6. Market Solutions • Competition, self-interest and choice • Preference satisfaction • Internalize externalities • Make prices reflect full costs • Creates incentives for innovation and substitution • Preferences weighted by purchasing power • Americans spend 6% of income on food for home consumption; ~1% on raw food • Many Africans spend 75%; ~ 50% on raw food • What happens when prices double? • Prioritize preferences or physiological need?

  7. ‘Externalities’ and the Anthropocene

  8. Prisoner’s Dilemmas • Global Climate Change • Natural resource depletion/biodiversity loss (finite raw material sources, finite services) • Innovation in the information age • Cooperation is best solution

  9. Can People Cooperate? • Stupid question • Are people good or evil? • Characteristics of an evil person • Characteristics of a good person • Economics, money and cooperationBauman Y, Rose E. Selection or indoctrination: Why do economics students donate less than the rest? Journal of Economic Behavior & Organization. 2011;79(3):318-327.; Frank RH, Gilovich T, Regan DT. Does Studying Economics Inhibit Cooperation? Journal of Economic Perspectives. 1993;7(2):159-171.; Kirchgässner G. (Why) are economists different? European Journal of Political Economy. 2005;21(3):543-562; Vohs KD, Mead NL, Goode MR. The Psychological Consequences of Money. Science. 2006 November 17, 2006;314(5802):1154-1156.

  10. Evolution of Cooperation • Genetic • Multi-level selection • Distribution of pro-social behavior • Bacteria, slime-molds, insects, fish, humans (super cooperators) • Oxytocin • Detecting cheaters • Cultural • Altruistic punishment • Punishing non-punishers • Group identity

  11. Economics of Cooperation • Peak oil, food supply and pandemics • Values maximized at price of zero • Competitive markets create scarcity (production and consumption) • “Energy transitions produce cultural transitions” • Myxococcus xanthus, Dictyostelium discoideum and the human predicament • “Struggle for energy causes violent conflict” • Cooperation for energy ends violent conflict

  12. Institutions for Cooperation • Institutions can make generous people act selfishly, or selfish people act generously • Reciprocity or payments? • Social norms: glorify greed or punish it?

  13. Conclusions • Markets emerged simultaneously with fossil fuels • Nature of ‘scarce’ resources has changed from rival, excludable to non-rival and/or non-excludable • Cannot transform physical characteristics of resources to fit market model • Must transform economic system to resource characteristics, human behavior • Prisoner’s dilemmas • Physiological necessities • Cooperation and common ownership

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