Top 15 Kate Raworth Quotes

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.

Depicting rational economic man as an isolated individual – unaffected by the choices of others – proved highly convenient for modelling the economy, but it was long questioned even from within the discipline. At the end of the nineteenth century, the sociologist and economist Thorstein Veblen berated economic theory for depicting man as a ‘self-contained globule of desire’, while the French polymath Henri Poincaré pointed out that it overlooked ‘people’s tendency to act like sheep’.31 He was right: we are not so different from herds as we might like to imagine. We follow social norms, typically preferring to do what we expect others will do and, especially if filled with fear or doubt, we tend to go with the crowd.

When Adam Smith, extolling the power of the market, noted that, ‘it is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner’, he forgot to mention the benevolence of his mother, Margaret Douglas, who had raised her boy alone from birth. Smith never married so had no wife to rely upon (nor children of his own to raise). At the age of 43, as he began to write his opus, The Wealth of Nations, he moved back in with his cherished old mum, from whom he could expect his dinner every day. But her role in it all never got a mention in his economic theory, and it subsequently remained invisible for centuries.

Here’s the conundrum: No country has ever ended human deprivation without a growing economy. And no country has ever ended ecological degradation with one.

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’.

Economics is the mother tongue of public policy,

Homo sapiens, it turns out, is the most cooperative species on the planet, outperforming ants, hyenas, and even the naked mole-rat when it comes to living alongside those who are beyond our next of kin.

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.

Despite their current rhetoric of ‘free trade’, when it comes to trade negotiations almost all of today’s high-income countries — including the UK and the United States — took the opposite route to ensure their own industrial success, opting for tariff protection, industrial subsidies and state-owned enterprises when it was nationally advantageous. And today they still keep tight control over their key traded assets such as intellectual property.

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.

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

argues the evolutionary psychologist Gerd Gigerenzer: we have survived and thrived not despite our cognitive biases but because of them. These so-called biases are the underpinnings of our heuristics, the unconscious mental shortcuts we take every time we use a ‘rule of thumb’ to make decisions. Over millennia, the human brain has evolved to rely on quick decision-making tools in a fast-moving and uncertain world, and in many contexts those heuristics lead us to make better decisions than exact calculations would do.

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

drop the economist’s beloved notion of ‘externalities’, those incidental effects felt by people who were not involved in the transactions that produced them — such as toxic effluent that affects communities living downstream of a river-polluting factory, or the exhaust fumes inhaled by cyclists biking through city traffic. Such negative externalities, remarks the ecological economist Herman Daly, are those things that ‘we classify as “external” costs for no better reason than because we have made no provision for them in our economic theories’.21 The systems dynamics expert John Sterman concurs. ‘There are no side effects — just effects,’ he says, pointing out that the very notion of side effects is just ‘a sign that the boundaries of our mental models are too narrow, our time horizons too short’.

Governments have historically opted to tax what they could, rather than what they should, and it shows.