It was very engaging to see a sustainable business model with a closed loop approach to responsible reuse and recycling of non-biodegradable waste. I learnt from the trip that their approach has been able to minimize greenhouse gases,freight costs and simplify logistics and ensure environmentally responsible handling and disposition of all electronic equipment.
This is a business model that has provided financial stability for the company involved, I am wondering why we don’t have more companies like this in the city which will agglomerate carbon foot print reduction because factually they cannot handle the waste produced by about 18 million inhabitants in the metro area.
Attending the trip to SIMS recycling center was a very interesting and eye opening experience. The guided tour showed the process that discarded materials such as plastic, metals and glass go through. I learned that one of their main ideas for creating this facility is to import and export materials mostly by barge, in order to reduce the amount of waste truck traffic throughout the city. Aside from creating less pollution throughout the city, it’s also designed to care for our marine life. The city specifically added reefs to provide new habitat for marine life. In addition, it’s fascinating to know that SIMS recycling center handles most of the cities recyclables up to 20,000 tons a month.
One of the reasons elucidated by William Emmons for economic stagnation in comparison to post war economy is stagnant incomes. He has observed that there has been an upward trend with inflation with a disproportionate stagnant trend in incomes and as a result of this situation less wages means less savings and investments leading to decrease in productivity thus lowering the standards of living.
According to the Emmons article. he question “Can American consumers continue to serve as the engine of U.S. and global economic growth as they did during recent decades? Several powerful trends suggest not, at least for a while. He mentioned five trends working against consumer spending and one of them is Stagnant Growth. Stagnant growth is potential slow economic growth and very high unemployment rate. In other words, jobs growth doesnt not match with the job seeker. Moreover, the prices of things will keep rising when ecnomic isn’t. When there is unequal growth between the consumer spending or consumer earning will affect the whole economic growth.
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My view on the neoclassical perspective as presented by the author is that people have rational preferences and they are associated with values, individual goals in the markets are maximum profits and that of firms are maximum profits and people act based on information.
The Neo-Keynesian theory assumes imperfect competition in the market and thus exist inequitable distribution of wealth and income and its concepts promotes subsidies for the development and use of clean energy
1. What is your understanding of the neoclassical perspective as presented by the authors? What are the assumptions about human economic behavior?
My understanding of the neoclassical perspective as presented by the authors is that the authors believe that the markets will eventually grow themselves to a point where technology can be made to contract the environment. They believe that if they simply put a tax on carbon emissions and leave it like that the problem will simply resolve itself when the market is right and the need is greatest. They believe that if they do anything but place a carbon tax or cap and trade policy into effect it will go against their policy of “economic growth is achieved by maximizing allocative efficiency”(pg 4). Therefore all the neoclassical policymakers will do is place a carbon tax or a cap and trade policy because they believe that is the only thing that will work against climate change. The assumptions about human economic behavior in my opinion is that we will continue to consume and spend money, the world is run by supply and demand as the demand continues to grow so too must the supply grow, as well it is believed that eventually when the need is greatest humanity will find the solution.
2. What is your understanding of the neo-Keynesian perspective? How does it differ from the neoclassical perspective? What do neo-Keynesian economists view as the most important policies to address the challenges of climate change?
My understanding of the neo-Keynesian perspective is that they focus solely on the demand without a regard to the supply part. They also believed that increasing government spending will increase consumer demand. The difference between neoclassical perspective and neo-Keynesian perspective is that in neoclassical perspective they believe the market will fix itself where the neo-Keynessians believe that “economic growth is a result of business investment, government spending, and consumer spending because of the demand for goods and services it produces. The neo-Keynesian believes in the sustainability of “green businesses” and the distribution of wealth.
My understanding of neoclassical perspective as presented by the authors is that it mainly focuses on the supply and demand. It focuses on the prices, outputs and income. Equilibrium is set when the amount of food sold is equal to the amount of good produced, therefore making sure that prices are ranged with marginal costs. They tend to maximize utility and firms maximums profits. Neoclassical believe that pricing carbon through a tax will allow markets to increase the price of high-carbon energy will create space for others.
My understanding of neo-Keynesian perspective is that when there is a profit, it is because of economic growth. It is growing because of the demand that people want; increasing the government spending which then increases consumer’s demands. The main difference from Neoclassical and Neo-Keynesian is that one practice free market spending while the other focuses on government spending.
- The authors discuss what they call“Innovation Economics.” What do Atkinson and Hackler mean by innovation economics? Describe their perspective.
The authors suggest that the predominant doctrines devalue innovations. This results in a 20th century perspective to address 21st century issues. The doctrine of innovative economics reconfigures previous models to recognize technology, entrepreneurship, innovation as primary factors as economic growth.
- What are the mainproblems the authors have with both the neoclassical and neo-Keynesian views about how to address the problem of climate change? What are the three arguments the authors cite as to why neither the neoclassical nor the neo-Keynesian views offer an suitable policy framework for addressing the climate challenges of the 21st century?
According to the authors, none of the predominant three doctrines (conservative neoclassical, liberal classical, and neo- Keynesian) offer a suitable approach to the climate change policy. They argue that this is largely due to three main factors. First, they suggest that each doctrine undervalues the importance of innovation and focuses to keep the economy stable and at equilibrium, promoting economical growth. Second, they undervalue other factors that drive growth such as institutional and technological-change factors and instead establish the importance on macroeconomics factors. Lastly, the above stated doctrines failed to recognize the complicated procedure of technological innovations.