Kate Raworth

In the words of the systems thinker John Sterman, ‘The most important assumptions of a model are not in the equations, but what’s not in them; not in the documentation, but unstated; not in the variables on the computer screen, but in the blank spaces around them’.

Out of all of these power relationships, when it comes to the workings of the economy, one in particular demands attention: the power of the wealthy to reshape the economy’s rules in their favour.

cleaning up a nation’s air and water by shifting from manufacturing to service industries doesn’t eliminate those pollutants: it sends them overseas, letting someone else, somewhere else, feel the burn while those back home can import the neatly packaged finished product.

…environmental quality is higher where income is more equitably distributed, where more people are literate, and civil and political rights are better respected. It’s people power, not economic growth persay, that protects local air and water quality. Likewise, it is citizen pressure on government and companies for more stringent standards, not the mere increase in revenue that compels industries to switch to cleaner technologies.

global greenhouse gas emissions is highly skewed: the top 10 percent of emitters — think of them as the global carbonistas living on every continent — generate around 45 percent of global emissions, while the bottom 50 percent of people contribute only 13 percent.

By largely ignoring the core economy, mainstream economics has also overlooked just how much the paid economy depends upon it. Without all that cooking, washing, nursing and sweeping, there would be no workers — today or in the future — who were healthy, well-fed and ready for work each morning.

Rather than overriding our rules of thumb with a nudge, he argues, we should nurture those heuristic abilities while bolstering them with basic skills in assessing risk.

Whether you consider yourself an economic veteran or novice, now is the time to uncover the economic graffiti that lingers in all of our minds and, if you don’t like what you find, scrub it out; or, better still, paint it over with new images that far better serve our needs and times. The rest of this book proposes seven ways to think like a twenty-first-century economist, revealing for each of those seven ways the spurious image that has occupied our minds, how it came to be so powerful, and the damaging influence it has had. But the time for mere critique is past, which is why the focus here is on creating new images that capture the essential principles to guide us now. The diagrams in this book aim to summarise that leap from old to new economic thinking. Taken together they set out – quite literally – a new big picture for the twenty-first-century economist. So here is a whirlwind tour of the ideas and images at the heart of Doughnut Economics. First, change the goal. For over 70 years economics has been fixated on GDP, or national output, as its primary measure of progress. That fixation has been used to justify extreme inequalities of income and wealth coupled with unprecedented destruction of the living world. For the twenty-first century a far bigger goal is needed: meeting the human rights of every person within the means of our life-giving planet. And that goal is encapsulated in the concept of the Doughnut. The challenge now is to create economies – local to global – that help to bring all of humanity into the Doughnut’s safe and just space. Instead of pursuing ever-increasing GDP, it is time to discover how to thrive in balance.

Economics (...) is not a matter of discovering laws: it is essentially a question of design.

Economics is the mother tongue of public policy,

More extraordinarily, scientists suggest that, if undisturbed, the Holocene’s benevolent conditions would be likely to continue for another 50,000 years due to the unusually circular orbit that Earth is currently making of the sun

One person who was willing to risk political suicide was the visionary systems thinker Donella Meadows — one of the lead authors of the 1972 Limits to Growth report

in 1767 — just 40 years after Newton’s death — when the Scottish lawyer James Steuart first proposed the concept of ‘political economy’, he defined it no longer as an art but as ‘the science of domestic policy in free nations’. But naming it as a science still didn’t stop him from spelling out its purpose: The principal object of this science is to secure a certain fund of subsistence for all the inhabitants, to obviate every circumstance which may render it precarious; to provide every thing necessary for supplying the wants of the society, and to employ the inhabitants (supposing them to be free-men) in such a manner as naturally to create reciprocal relations and dependencies between them, so as to make their several interests lead them to supply one another with their reciprocal wants.

The search for gain — which drives shareholder returns, speculative trading and interest-bearing loans — lodges dependency upon continual GDP growth deep within the financial system.

Nudges and network effects often work because they tap into underlying norms and values — such as duty, respect and care — and those values can be activated directly.