Course:ECON371/UBCO2024WT1/Reflections/OliviaMartiskainen
Reflection #1:
As an economics major, I came into this class with a lot of background knowledge in economics. I had already heard about the economic damages caused by pollution, externalities, public and common goods, the tragedy of the commons, and cost-benefit analysis. I am glad that I chose to enroll in this class because, while it has not been the most technically challenging class that I have taken, it is probably the only economics course that I have taken that has spent a significant amount of time highlighting and discussing some of the limitations and flaws of the economic approach to problem-solving. I have taken some political science courses which have discussed critiques of economics and neoliberal economic policies which focus on deregulation and improving market efficiency. I have heard about issues such as the irrationality and inconsistency of people’s preferences and the incommensurability of different goods. However, these critiques of the economic approach have never been drawn to my attention during an economics class. I think that economics students should be required to take a class or read some material that argues against some of the key assumptions of economic theory, because if they graduate thinking the discipline of economics is the best way to solve social problems, this is too narrow minded. When the only tool you have in your toolbox is a hammer, every problem looks like a nail. I think for some academics and technocrats, economics is that hammer. However, not every problem is best solved by rigorous economic analysis and adherence to efficiency.
The safety standard has been interesting to learn about because it puts a strong emphasis on rights, in particular the right to not be harmed by another’s activities. I have taken a philosophy of law course and we discussed something called the harm principle, which essentially states that adults should be able to do whatever they like so long as it does not cause harm to another person. This principle seems to be inherently fair to me. As a principle of justice, I think this can be applied to many cases of pollution where uninvolved individuals are harmed by pollution that a company creates in its pursuit of profit. It seems quite clear to me that citizens of a country should be protected from harm due to pollution, but a more difficult question then is to what degree must they be protected from harm? What degree of harm is considered an acceptable standard? For many industries, the answer cannot practicably be zero as this would be prohibitively expensive to adhere to. That is a question which is difficult to answer. The question of how much cost a company should have to bear in order to operate is a normative one.
The sustainability standard, on the other hand, can also be interpreted as focusing on rights, but these are the rights of future generations to live in a world that has enough resources to support them. It is the right of future generations to not be condemned to misery or poverty by the decisions of their grandparents. If global warming has disastrous effects, technology may not be able to keep up with the changing ecosystems. This standard also seems to be a fair one to me. The question of what pace of resource extraction is sustainable is also difficult to determine, although this is mainly due to modelling limitations and uncertainty rather than normative differences of opinion.
Learning about these standards has made me think about the best way to approach environmental management issues. I think that both in terms of sustainability and safety there should be some sort of minimum standards below which we, as a global society, should not sink. However, I do not know where those standards are. This is not a radical change in mindset for me, as I would describe myself as politically progressive and therefore have a kind of “minimum standards should exist” approach to things such as government welfare policy and government transfers to the needy. These government programs are not necessarily the most efficient use of resources. However, I feel that there is a moral argument to be made for avoiding certain dire outcomes such as starvation, homelessness, exposure, etc. I feel the same way about environmental protection.
This has led me to question the assumptions that are taken for granted in many of my economics courses and that I may have started to unknowingly incorporate into my worldview. Efficiency is only one standard by which to measure success and it is often an incredibly inappropriate standard to use. One reading from this class I really liked was the one about incommensurability and the problems it poses for economic analysis of policy decisions involving conflicts of value. Incommensurability is one area where the economics framing seems incomplete. It is important to note that incommensurability does not entail incomparability. Comparability means that we know X is more than Y. Commensurability means that we know that X is more than Y and by how much. If two goods or values are incommensurable, for example the value of the existence of caribou and the value of the development that could be done on a piece of land, it is impossible to know by how much to compensate the losers of environmental destruction. This is a step that is necessary to, in theory ensure at least potential Pareto efficiency improvements. These improvements form the base of the entire ethical argument for efficiency. Therefore, any ethical case for efficiency collapses.
I do think that the economics framing can still be useful as a technical tool and as a way to aggregate a lot of information before presenting it to decision makers. However, I think that economic analysis should only be one tool in policymakers’ toolbox. Other tools should be community consultation, consideration of legal precedent including legal rights and responsibilities, analysis of equity and sustainability concerns and consideration of local traditional or cultural values.
Reflection #2
After completing the rest of this course, I don’t think my mind has changed substantially on anything. I am glad we discussed more about the inequities between the global North and South, and how these inequities are playing out in climate change talks. I also thought it was valuable to include perspectives on resource governance that are not based on a strict rationality model. Both of these topics will be valuable as we work to create frameworks for dealing with the costs of climate change.
The political and economic differences between the global North and South, or alternatively rich countries and developing poorer countries, are stark. An understanding of these differences is essential for understanding the dynamics and incentives of different countries’ environmental policies as well as international agreements on climate change. Many of the poorest countries are those that will be hardest hit by rising sea levels and temperatures, even while they are the least equipped to deal with the social and economic consequences. This is due to a combination of low financial capital to be used for adaptation technologies and infrastructure, as well as weak institutional capacity to deal with the health impacts, loss of jobs, and increasingly frequent extreme weather events and natural disasters. Since wealthy countries contributed and are still contributing heavily to global warming due to high emissions from industrial production, as well as high levels of consumption, there are concerns being raised about the fairness of countries that did not cause environmental damage being hit hardest by the effects. In addition, the switch to cleaner sources of energy that is being pushed by many countries in the North is not affordable for many countries in the South. One solution that has been proposed is for wealthy countries to send financial transfers to poor countries to help fund their environmental projects and transitions to green energy. However, these financial transfers have not been in high enough amounts so far. Learning about this has made me think of the injustice involved in a lot of environmental issues, and how the nature of living on an interconnected planet means that impacts of our actions cannot be confined to the borders of one’s country.
Learning about this has also reminded me of some topics I learned about in my Global Political Economy class this term, particularly in terms of how international organizations or networks can often be dominated by more powerful, wealthier members. There was one example where an international city network was pressuring member cities to spend their money on climate change mitigation efforts, particularly reducing carbon dioxide emissions, rather than on adaptation efforts such as improving flood prevention infrastructure. This makes sense because the benefits of mitigation efforts can be felt worldwide, while the benefits of adaptation strategies are often highly localized. However, it is an open debate as to what level of local or global benefits should be prioritized by democratically elected governments who have a mandate to protect their own citizens. This also raises the question of agency and self-determination in environmental policy, and who should be making decisions on how to best manage their cities and countries.
This links to the articles we read this week on governing common pool resources. I had read sections of Elinor Ostrom’s original 1990 book “Governing the Commons” in a previous course, so the class discussions we had about communities successfully governing their own common pool resource without privatization or government regulation were a bit of a review for me. I think that Ostrom’s work is very compelling, as the assumptions of the model of behaviour used in Hardin’s tragedy of the commons are too simplistic. People do not only seek to maximize their short-term gain, but also long-term wellbeing and social standing in the community. People are also able to communicate with each other and make credible commitments to abstain from overexploiting their resources. I think it is important to look at the characteristics of successful long-term resource management schemes in order to draw inspiration for how to manage our environment in the future. However, I do think that the concept of the planetary commons that we talked about in class is not realistic as an international legal concept. It would require too abrupt of a shift away from established understandings of state sovereignty and voluntary agreement to international treaties. The legal field as a whole relies heavily on precedents and deducing rules from previous cases or widely accepted norms. I believe that state sovereignty is much too strong of a concept in international law to be overruled by the need for environmental protection in the next few decades.
Overall, I have learned a lot from this course and I will keep it in mind in the future in my other economics courses, reading the news, and when interacting with debates on public policy and environmental justice.
Prof: Thanks for your reflections, and honestly saying that your mind has not been changed that much. The issues you describe I agree with. I wish I could stand up front and credibly say 'this is how we solve things'. However, I can't, and as you describe, the role of state sovereignty in all of this isn't just going to magically go away. The politics of groups using whatever power they have to protect and promote their interests isn't going to stop when we recognize that our fates are all connected. They are all connected, but not equally and not necessarily even in the same direction. It is probably an exciting time for the observers from the Imperial Galactic Government watching the evolving Earth experiment (Hitchhiker's Guide to the Galaxy), but darn scary to be in the experiment!