The Entropy Law and the Economic Process [Paperback]

Nicholas Georgescu-Roegen (Author)

Book Description

Publication Date: November 23, 1999

"Every few generations a great seminal book comes along that challenges economic analysis and through its findings alters men's thinking and the course of societal change. This is such a book, yet it is more. It is a "poetic" philosophy, mathematics, and science of economics. It is the quintessence of the thought that has been focused on the economic reality. Henceforce all economists must take these conclusions into account lest their analyses and scholarship be found wanting. "The entropy of the physical universe increases constantly because there is a continuous and irrevocable qualitative degradation of order into chaos. The entropic nature of the economic process, which degrades natural resources and pollutes the environment, constitutes the present danger. The earth is entropically winding down naturally, and economic advance is accelerating the process. Man must learn to ration the meager resources he has so profligately squandered if he is to survive in the long run when the entropic degradation of the sun will be the crucial factor, "for suprising as it may seem, the entire stock of natural resources is not worth more than a few days of sunlight!" Georgescu-Rogen has written our generation's classic in the field of economics."Library Journal

Product Details

• Paperback: 476 pages
• Publisher: iUniverse (November 23, 1999)
• Language: English
• ISBN-10: 1583486003
• ISBN-13: 978-1583486009
• Product Dimensions: 9 x 6.1 x 1.2 inches
• Shipping Weight: 1.6 pounds (View shipping rates and policies)
• Average Customer Review: 4.5 out of 5 stars  See all reviews (10 customer reviews)
• Amazon Best Sellers Rank: #461,665 in Books (See Top 100 in Books)

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Most Helpful Customer Reviews

19 of 20 people found the following review helpful:

4.0 out of 5 stars Mixed bag of valuable insights and dated rant (3.5 stars), April 30, 2008

By 

A. J. Sutter (Tokyo, Japan) - See all my reviews
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This review is from: The Entropy Law and the Economic Process (Paperback)

There are many great criticisms of neoclassical economics in this book. Georgescu-Roegen (G-R) points out such flaws as
@ regarding the economy as a closed, circular system;
@ neglecting qualitative changes because of the theory's preference for "arithromorhpic" concepts, i.e., concepts organized into distinct and non-overlapping gradations (such as preference/indifference/non-preference), rather than having fuzzy edges or ambiguities (such as real human preferences);
@ failing to attribute value to leisure, and negative value to the drudgery of work (albeit that assuming work must involve drudgery is itself based on some presuppositions not mentioned by G-R); and
@ fallacies in production models, "stock-flow" analysis and input-output tables.
The critique is usually presented with a refreshing brio. G-R isn't afraid to call ideas stupid when he believes them so.

But ... a lot of this book seems to go off the track. There is way more discussion of history of math and physics than seems necessary. Lengthy discussions of eugenics and cloning near the end of the book kind of come out of nowhere. Much of this, especially the biology, is by now very dated, and even that which is less so is often superfluous and bombastic. Some readers may think G-R prophetic because of his occasional allusions to solar power, and I was surprised to see him use the expression "nanotweeze" (as a noun) in 1971 (@351) -- but the book is wrong about so many other forward-looking details that these seem almost like lucky guesses, given the wide range of topics G-R drags into the book.

More substantively, G-R's understanding of physics was quite loose and often wrong. He errs when he talks about how "our whole economic life feeds on low entropy" (@277). Here he seems to be following an error Erwin Schroedinger made in an early edition of his "What is Life?"; Schroedinger corrected the error in a subsequent edition long before G-R's book, but that correction goes unnoticed. G-R's idiosyncratic usage of the terms "free energy," "bound energy" and "polymeres" (sic) will also set your teeth on edge if you come from a natural science background.

G-R does not make a convincing case for the relevance of entropy to economics. There are at least three reasons for this. First is G-R's faulty exposition of the concept, as mentioned above. Second, G-R doesn't adequately motivate the thermodynamics metaphor in economics. As shown in P. Mirowski's "More Heat than Light", the adoption of this metaphor was without empirical motivation, and came in no small part from a kind of "physics envy". It's true the metaphor as adopted didn't include the Second Law (about entropy). But before faulting the model for that omission, one should show why the analogy is appropriate at all. Instead of doing so, G-R mentions a few times that thermodynamics was based on an economics analogy. That's not good enough, especially given the distinctions between physical and social sciences G-R describes in his Chapter XI. Third, even assuming the thermodynamics metaphor can be justified, G-R doesn't address the proper limitations for the metaphor's domain of application. Why just add the Second Law into economics? How about non-equilibrium thermodynamic formalism? How about an analogue to chemical kinetics, which prevent chemical reactions from reaching equilibrium instantly or even at all, and without which we could not be alive? G-R ignores all these, without explanation (indeed, without seeming to be aware of them).

G-R is more convincing in the more limited claim that neoclassical economics models err in considering waste as an "externality", if not ignoring it altogether. That's a significant point, and he deserves credit and gratitude for making it. But this ambitious book does not read today like the grand philosophical synthesis it seems to have been intended to be.

22 of 25 people found the following review helpful:

5.0 out of 5 stars A must for ecological economists, economists, and ecologists, February 2, 1998

By A Customer

This review is from: The Entropy Law and the Economic Process (Paperback)

This review includes: 1) Review, 2) guide to related books 3) some citations, and 4) table of contents. The first 9 chapters he discuss the historic developments in philosophy of science, physics and economics. This leads him to conclude that standard economics is founded on analogies to newtonian mechanics. He explores several problematic aspects of this line of thought. These includes the problem of defining the boundaries of the economic process, the problem of treating qualitative changes within the mechanical framework. Within physics the theory of classical thermodynamics, was to revolutionize the discipline of physics. The first law of thermodynamics stated that matter-energy cannot be created nor destroyed. This was not in conflict with Newtonian mechanics. The second law of thermodynamics states that within a closed system the availability of matter-energy decreases. This second law conflicts with classical mechanics, in the way that this process can only consist of a qualitative change. The first part of the book is deals primarily with philosophical and physics issues, and although NGR was economist himself - these discussions are very hard to grasp for a social scientist, as myself. The second part consists of an analysis economic theory (Marx, Marshall, Leontieff and others), founded on the conclusions reached in the first part of the book. The general conclusion is that it is unreasonable to believe that the economic process can defy any laws of physics. At present economic theory ignores the second law of thermodynamics, leading to an uneconomical use of our physical surroundings. Although NGR is cited in any decent microeconomics textbook (for his contributions to micro-theory), this book recieved little response from economists, allthough it remains a classic within ecological economics (Herman Daly cites it all the time). And it is a must for any advanced student of human-environmental interactions. It is, however a VERY demanding book - Some of his articles are recommended instead for starters. John Peet (1992) 'Energy and the ecological economics of sustainability' is also recommendable. Here is a few citations, followed by a list of contents of the book: ' In this sense Classical mechanics is mechanistic because it can neither account for the existence of enduring qualitative changes in nature nor accept this existence as an independent fact. Mechanics knows only locomotion, and locomotion is both reversible and qualityless' ' Since the economic process materially consists of a transformation of low entropy into high entropy, i.e., into waste, and since this transformation is irrevocable, natural resources must nessecarily represent one part of the notion of economic value. And because the economic process is not automatic, but willed, the services of all agents, human or material, also belong to the same facet of that notion. For the other facet, we should note that it would be utterly absurd to think that the economic process exists only for producing waste. The irrefutable conclusion is that the true product of that process is an immaterial flux, the enjoyment of life. This flux constitutes the second facet of economic value. Labor, through its drudgery, only tends to diminish the intensity of this flux, just as a higher rate of consumption tends to increase it.' TABLE OF CONTENTS 1. Science: A brief evolutionary analysis 2. Science, arithmomorphism, and dialectics 3. Change, quality and thought 4. Measure, size and sameness: Some object lessons from physics 5. Novelty, evolution, and entropy: More object lessons from physics 6. Entropy, order, and propability 7. Chance, cause, and purpose 8. Evolution versus locomotion 9. The analytical representation of process and the economics of production 10. Entropy, value, and development 11. The economic science: Some general conclusions

30 of 36 people found the following review helpful:

1.0 out of 5 stars Good intentions no substitute for poor science, December 19, 2005

By 

J. Floyd (Melbourne, Australia) - See all my reviews
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This review is from: The Entropy Law and the Economic Process (Paperback)

Georgescu-Roegen's intentions are laudable, as are many of his proposals. The thermodynamic basis of this work, unfortunately, is unsupportable. This is a pity, as it has left his critique of capitalism open to dismissal, and has contributed to a generation of obfuscation in social and environmental theory.

The problem, simply put, is this: while it sounds convincing to most lay-people (and even many physicists, chemists and engineers) to equate thermodynamic entropy with "disorder", this is based on a meaningless misinterpretation of the second law of thermodynamics. The second law of thermodynamics simply states that energy tends to disperse, if it is not hindered from doing so. It says nothing about "orderliness", and nothing about availability of matter.

Entropy is an extensive property of thermodynamic systems. It is not a property of energy, and certainly not of matter. It is nonsensical to speak of "high- or low-entropy" energy. It is even more nonsensical to speak of "high- or low-entropy" matter. Better to speak of energy quality ("the sun provides us with high-quality energy, and low-quality energy is re-radiated back into space"). Entropy is used to measure the "concentration" (I use this term for illustration only) and hence the usefulness or availability to us of energy, within a given system of matter and energy. The second law of thermodynamics tells us nothing about the tendency of matter to become more or less useful or available to us. There is no thermodynamic basis for reading inevitable decay onto physical, biological or social systems.

Dr. Frank L. Lambert, Professor Emeritus (Chemistry) of Occidental College, Los Angeles, has carried out extensive work over the past few years to demythologise the popular (and, all too frequently, specialist) misunderstanding of the second law of thermodynamics. For anyone contemplating reading "The entropy law and the economic process", I would strongly advise that you first look at Lambert's website: http://www.entropysite.com. He goes through this in detail in multiple format aimed at a range of audiences from lay-person to scientist and engineer.

This review is not intended to be disparaging, towards either Georgescu-Roegen, or others who share the common misunderstanding of the second law of thermodynamics. The problem is deeply entrenched and it will be a long time before the myths around entropy and the second law are dispelled. This is a start.