You Can't Eat Gnp: Economics As If Ecology Mattered (Merloyd Lawrence Book) [Paperback]

Eric Davidson (Author)

Book Description

Publication Date: March 27, 2001 | Series: Merloyd Lawrence Book

"In clear, measured prose Davidson lays out how the traditional tools of economics don't work when you are talking about concrete things like soil, forests, garbage."-Inc.Ecology and economics are not doomed to be adversaries. This lively and concise book presents the exciting new insights of environmental economics as well as the three fallacies of conventional economic analysis. You Can't Eat GNP offers a blueprint for a truly sustainable economy that recognizes the natural resources (like water, air, and soil) on which we ultimately depend.Eric A. Davidson, Ph.D., is a senior scientist at the Woods Hole Research Center. His fieldwork takes him from the Brazilian Amazon to the re-growing forests of New England and he has conducted research at the University of California, Berkeley, and at the NASA Ames Research Center.A Merloyd Lawrence Book

Editorial Reviews

Amazon.com Review

Eric A. Davidson's engaging and informative book couldn't have come at a more timely moment. In an age when high technology is driving our economy and propelling us further from the ecological system that physically supports us, You Can't Eat GNP sends a loud and urgent message: the economic system will fail if the ecosystem is not carefully managed.

As Davidson explains, the system of neoclassical economics, which governs our economy, assigns value to goods depending on the level at which they're produced and consumed. For example, marketed consumer products like bread hold high value, while bread's main ingredient, flour, holds less. Flour in its unprocessed form, wheat, holds even less value, and the soil from which wheat is grown holds the least worth of all. This triangle has become an exact inversion of the ecologist's pyramid, however, in which soil--which supports the entire ecological system, from plants to herbivores to carnivores--is viewed as the pyramid's stabilizing resource. Davidson argues these opposing models must be integrated in order to preserve the ecological system that sustains our economic system. He doesn't propose a "back to nature" solution, nor does he negate the importance of technological developments stimulated by our present mode of economics. He does, however, agree with R.H. Tawney's observation that "If economic ambitions are good servants, they are bad masters." Davidson examines the environmental effects of rigidly employed economic values such as cost-benefit analysis and considers the inevitable economic effects of global warming, waste disposal, and the failure to pursue sustainability. Though his proposals for change are not extensive, he does offer workable (and sometimes controversial) suggestions for both individual and community action.

An author as well as a respected scientist, Davidson writes in clear, lucid prose, making the sciences of economics and ecology accessible to the nonscientific reader, without dumbing down his arguments. He supports his points with relevant, contemporary examples, highlighting the vital importance of managing the economy in conjunction with the environment. As this intelligent treatise wryly reminds us, no matter how booming the economy, we'll never be able to eat our gross national product. --S. Ketchum --This text refers to an out of print or unavailable edition of this title.

About the Author

George M. Woodwell, Ph.D., the internationally renowned ecologist, is founder and president of the Woods Hole Research Center.

Product Details

• Paperback: 272 pages
• Publisher: Basic Books (March 27, 2001)
• Language: English
• ISBN-10: 0738204870
• ISBN-13: 978-0738204871
• Product Dimensions: 8.5 x 5.5 x 0.7 inches
• Shipping Weight: 11.8 ounces (View shipping rates and policies)
• Average Customer Review: 4.4 out of 5 stars  See all reviews (8 customer reviews)
• Amazon Best Sellers Rank: #643,724 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

23 of 23 people found the following review helpful:

5.0 out of 5 stars Redefining Global Priorities, May 17, 2000

By 

Robert Morris (Dallas, Texas) - See all my reviews
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This review is from: You Can't Eat Gnp: Economics As Though Ecology Mattered (Hardcover)

The title is explained in Chapter 1 when Davidson examines three fallacies of the current mainstream economic and technological model. At least one economist has argued that there is no need to worry about global warning because the only sector of the economy affected by it -- agriculture -- contributes only 3% of the United States' GNP. Davidson observes: "Like Marie Antoinette's suggestion that the French peasants without bread could eat cake [more accurately, crumbs from a bread pan], this view of how the world works seems to suggest that if the crops fail, the people could eat the 97% of the GNP which remains." This is Fallacy #1: "Marie Antoinette Economics."

The second fallacy naively asserts that the technological "cavalry" will come over the hill in time to save us from economic disaster; the third fallacy incorrectly assumes that, because of certain modest improvements of the quality of air and water, environmental pollution is no longer a serious problem. Davidson's purpose is to examine the implications and consequences of these fallacies. He believes (and I wholeheartedly agree) that economic realities and environmental imperatives are NOT mutually exclusive; on the contrary, they are interdependent.

One bestselling tee-shirt proclaims "We're Having a Great Time Spending Our Children's Inheritance!" In a sense, that is what Davidson has in mind when lamenting the relentless depletion of the earth's natural resources to achieve short-term financial objectives. To illustrate his key points, he introduces two pyramids in Chapter 2. One shows how dependent we are on a stable resource as our base; the second (inverted) pyramid shows how the principle of supply and demand results in a relentless reduction of that base. According to Davidson, the priorities of ecology and economics can be accommodated if certain prudent national and international measures are initiated and then sustained. These he proposes in Chapter 9:

1. Stop building new roads.

2. Eliminate tax reductions for more than two children in countries that have income taxes.

3. Reduce taxes on income and increase taxes on consumption.

4. Eliminate governmental subsidies, such as water projects that hinder the market forces that would otherwise promote water conservation, more prudent use of groundwater, and prevent soil salinization.

5. Support governmental and nongovernmental extension efforts to encourage farmers in both industrialized and developing countries to make more efficient use of their land while conserving soil and using only essential quantities of fertilizers and pesticides.

6. Eliminate governmental subsidies for industrial fisheries and foster agreements among nations and among and within communities to protect the fisheries commons. 7. Ratify and enforce the binding international agreement reached in Kyoto, Japan, in 1997 reducing greenhouse gas emissions.

8. Negotiate international agreements on maintaining forest cover and managing forests to maximize genetic diversity of plants and animals.

What if we don't take these and other initiatives? Davidson has written this book in direct response to that question. In ways and to an extent many of us do not realize, there has been an on-going process of discounting, devaluing, and degrading the earth's environment. Davidson is somewhat encouraged by certain developments (albeit isolated and inadequate) which suggest that there is at least some increased awareness of the various problems. He is fully aware of the great difficulty of changing the minds of policymakers, business leaders, voters, and consumers by helping them to understand -- and properly value -- the "essential links" between ecology and economics. Davidson makes a substantial contribution to the achievement of that objective.

If you share my high regard for this book, I suggest that you check out Natural Capitalism, The Lexus and the Olive Tree, and Holding On to Reality..

18 of 20 people found the following review helpful:

3.0 out of 5 stars Lend this book!, August 1, 2000

By 

Thomas M. Martin (San Francisco, CA USA) - See all my reviews
(REAL NAME)   

This review is from: You Can't Eat Gnp: Economics As Though Ecology Mattered (Hardcover)

If the fundamental concept in economics is scarcity, why has it proven so impotent, if not downright counterproductive, when it comes to addressing environmental issues? This question is of central importance to those, like Eric Davidson, would like to see "ecological economics" enter public discourse and the policy-making arena.

This is an informative book written in a very engaging, if polemical style. As the subtitle (Economics as if Ecology Mattered) suggests, the general approach is to contrast the ways ecologists and economists look at the natural environment and to show how traditional economic theory encourages resource depletion and pollution. That may sound like a mouthful, but Davidson's approach is to introduce, illustrate, and even popularize economic concepts (pricing, cost-benefit analysis, marginal analysis, discount rates, and externalities) from the critical perspective of an ecologist. Along the way, he invents some "fallacies" (which, arguably, he also succumbs to), provides graphic visualization aids to contrast the different ways ecologists' and economists' view natural resources, and he explores some interesting case studies and possibilities based on his own work in the Brazilian rainforest. As an introduction to both environmental studies and basic concepts in (micro)economics, the book succeeds on two levels. (As an introduction to macroeconomics and sustainability, it probably succeeds on only one - environmental studies.)

Unfortunately, the strengths of the book, namely, its simplicity, also point to its weaknesses. For anyone who, like Davidson, has been struggling along this same path (me, for instance), it seems clear that Davidson's book cannot hope to convince professional economists or policy-makers who, to give them credit, possess far more theoretical virtuosity than Davidson's arguments might suggest. To make matters worse, popular works of (micro)economics are often written by economists who are staunch libertarians, and their counterarguments would be...well, it wouldn't be pretty. They inhabit a theoretical universe which does not recognize a "precautionary principle" higher than free choice, and they abhor the kinds of government intervention and regulation that Davidson's brand of environmental economics suggests. Indeed, most of the time Davidson is arguing for a normative (what should be), rather than a positive (what is) brand of ecological economics that is never made explicit (enough). Ultimately these kinds of theoretical differences boil down to questions about human nature, and the darker, greedier view of humans, who blindly follow their self-interest and `trash the commons', has a proven, if hardly illustrious, record in both theory and practice. Davidson's critique notwithstanding, one can't help but fear for the fate of homo ecologicus who pursues long-term sustainability, but is forced to compete with homo economicus who sees only short-term gains.

In his conclusion, Davidson makes some suggestions about what kinds of constructive steps individuals can make on their own. Foremost among them is to `lend this book to someone who is unlikely to buy literature on science, economics, and the environment.' Frankly, since he is preaching to the converted when it comes to me, I will follow his suggestion and lend the book out. But I also intend to follow his recommendation regarding audience - which underscores my only caveat.

8 of 8 people found the following review helpful:

5.0 out of 5 stars Economics as a Life Science, May 23, 2001

By 

Robert Costanza (University of Maryland) - See all my reviews

This review is from: You Can't Eat Gnp: Economics As If Ecology Mattered (Merloyd Lawrence Book) (Paperback)

Both ecology and economics share the same Greek root, oikos, meaning, literally, "house." Linked with nomics it means management of the house. Linked with logy it means study or knowledge of the house. Obviously, study and knowledge should go hand in hand with management, and good ecology should be a basic ingredient in good economics. Unfortunately, in the recent past, ideas about management of our world as encoded in conventional economic theory, in biologist E. O. Wilson's words, "can be summarized in two labels: Newtonian and hermetic. Newtonian, because economic theorists aspire to find simple, general laws that cover all possible economic arrangements. ... hermetic - that is sealed off from the complexities of human behavior and the constraints imposed by the environment." Eric Davidson's book is a readable summary of many of the main ideas of ecological economics. He begins by describing three basic fallacies of the mainstream economic model. The first he calls the "Marie Antoinette" fallacy. The mainstream model assumes near perfect substitutability between land (natural resources), labor, and capital. If we deplete all our natural resources, "no problem" claims the mainstream model, we simply substitute more labor or capital - or as Marie Antoinette reportedly said when the French peasants were complaining about not having any bread - "well, let them eat cake!" The truth is that manufactured capital, human capital, social capital, and natural capital function more like compliments than substitutes and a sustainable economic system requires a safe minimum of each of these four types of capital. The second fallacy Davidson calls "Custer's folly" - the assumption that the technological cavalry will come over the hill to save us from ecological disaster just in time. The problem is that while technology might come up with solutions, it is foolhardy to assume that it will, especially when the stakes are so high. It is much more rational to assume that technology will not come to the rescue at the last minute and take a more precautionary approach that assures our sustainability regardless of hoped for technological changes. The third fallacy is "False complacency from partial success." If we can solve some environmental problems, we can, by extension solve all environmental problems. Davidson likens this line of argument to a claim by a spouse abuser that he is a good person because he no longer beats his spouse as much as he used to. The truth is that many environmental problems that have appeared to be "solved" have actually just been moved to other regions or countries or social groups, often as a consequence of more open trade. Also, in the crowed world in which we now live, many new technologies have unintended consequences that may completely undermine and outweigh their initial, positive effects (i.e. DDT, chloroflorocarbons).