New Paper in Ecological Economics

21 06 2018

Achieving Global Climate and Environmental Goals by Governmental Regulatory Targeting

[Before August 10, 2018, this paper can be downloaded for free by clicking here.]


Strategic niche management and transition management have been promoted as useful avenues to pursue in order to achieve both specific product or process changes and system transformation by focusing on technology development through evolutionary and co-evolutionary processes, guided by government and relevant stakeholders. However, these processes are acknowledged to require decades to achieve their intended changes, a time frame that is too long to adequately address many of the environmental and social issues many industrialized and industrializing nations are facing. An approach that involves incumbents and does not consider targets that look beyond reasonably foreseeable technology is likely to advance a model where incumbents evolve rather than being replaced or displaced. On the other hand, approaches that focus on creating new entrants could nurture niche development or deployment of disruptive technologies, but those technologies may only be marginally better than the technologies they replace. Either approach may take a long time to achieve their goals. Sustainable development requires both radical disruptive technological and institutional changes, the latter including stringent regulation, the integration of disparate goals, and changes in incentives to enable new voices to contribute to new systems and solutions. This paper outlines options for a strong governmental role in setting future sustainability goals and the pathways for achieving them.

Inclusive Capitalism

26 03 2018

Earlier this month, Prof. Robert Ashford and I had the pleasure of engaging with various academic, government, and non-government entities in the UK about our ideas on inclusive capitalism. The two images below will take you to a version of the presentations we gave at the University of Oxford, in London (at the Portcullis House and Syracuse University’s Faraday House), and at the University of Southampton.

In the first presentation, I outline two major challenges that can be represented by two “ice hockey stick” curves. The first curve relates to global climate change, but can be thought of as emblematic of a range of stubborn environmental concerns that show no signs of halting or declining with continued economic growth. I predict that we will soon see a similar curve for the volume of plastic waste in the world’s oceans. Curves could also be drawn for the bioaccumulation of persistent chemicals. For example, when looking at the health of long-lived and high trophic level marine mammals, there is now evidence that some killer whales have consumed sufficient quantities of polybrominated diphenyl ethers (PBDEs) to be fireproof. Many scientists are now concerned about the health and environmental impacts of these chemicals, especially on reproductive and immune systems.

The second ice hockey stick curve provides a snapshot of the concentration of wealth in the US that is accompanied by a series of graphs that chart a number of concerns relating to the hollowing out of the middle class (or job polarization) in America and the EU, and to trends in income inequality over the past several decades.

The real challenge comes when the two curves are considered alongside one another. In 2012, the Rio+20 conference advanced the notion of the Green Economy as a mechanism through which progress will be made towards sustainable development. Since the dominant strategy for advancing a green economy – that targets the decoupling economic growth from growth in environmental impacts – is based on advanced and hyper-efficient technologies, a critical question is what will happen to well-paying jobs and more broadly to trends in income inequality and job polarization. (For more on this issue, see my book review of Cents and Sustainability.) Having mapped out these macro concerns, Prof. Ashford (in his presentation) provides a new way to view them based on the principles of binary economics (what we call inclusive capitalism).

The following text (from our talk description) provides a brief overview of the content of Prof Ashford’s presentation (which can be viewed by clicking on the image below below).

To reverse growing income inequality and to achieve greater and more broadly-shared prosperity and sustainable growth, Professor Ashford advocates a much more “inclusive capitalism” (beyond conventional right- and left-wing strategies of austerity and stimulus) based on “binary economics.” The inclusive capitalism approach is to broaden competitive market opportunities to acquire capital with the earnings of capital. The same market mechanisms that presently assist mostly wealthier people to acquire capital with the earnings of capital can even more profitably be opened, without redistribution, to assist poorer people to acquire capital with the earnings of capital. The prospect of such ownership broadening will unleash substantial (presently suppressed) productive capacity in the UK because the prospect of more broadly distributed capital earnings in future years provides great untapped incentives to profitably employ more labor and capital in earlier years.

100andChange Moonshot

3 10 2016

Our proposal for the MacArthur 100&Change ($100 million) grant was submitted this morning. Using the language of Virginia Tech’s Beyond Boundaries initiative, this is our ‘moonshot’ idea. If implemented it could fundamentally retool the global economy to provide everyone with a capital ownership stake in an inherently sustainable economy. Here is the executive summary of our proposal:

Boldly conquering global poverty will require an innovative economic paradigm that provides everyone on this planet with a personal ownership stake in the future. This project aims to transform our economic systems and promote sustainable enterprises by leveraging creativity and innovation. Our forward-looking mechanisms will enable all people to obtain a capital-based income that will supplement their labor income. Using the principles of binary economics, people will acquire capital with credit repayable with pre-tax future earnings of capital (future savings). The approach does not require coercive actions of government or a redistribution of existing wealth. As capital ownership becomes more broadly distributed, the economy will grow as people spend their newly acquired income on inherently sustainable goods and services. Our team’s alliance of academics and expanded-ownership pioneers will demonstrate how universalizing access to capital ownership can reduce inequality and advance sustainable development to create inclusive and sustainable prosperity for all.

In this post, I wanted to reflect a little on how we made it to this point.

My decision to advance a proposal came after listening to Regina Dugan speak at Virginia Tech in August. During her talk, Dugan commented that organizations are often limited not by what they can do, but by what they “believe” they can do. Having initially decided not to develop a 100&Change proposal due to the sheer scale of the grant and significant global competition, her comments and the Beyond Boundaries initiative made me rethink this decision.

I would put my ideas for how to spend this scale of funding into two categories. The first contains those ideas that could lead to siginfnicant progress, but largely within the existing development paradigm. One example would be the creation of an accessible and open data-rich sustainable water decision-support platform that could be expanded to include other sectors of the economy such as energy and agriculture. The second category contains those ideas that are potentially transformative in a macro sense, but are also currently on the fringe of mainstream thinking. One example, and the anchor of our 100&Change proposal, is the theory of binary economics that has been developed for over fifty years, but has yet to receive significant attention.

During her talk at Virginia Tech, Dugan commented that real innovations tend to occur when you feel uncomfortable about what you are doing – uncomfortable in the sense that there is no known pathway to success and there is a high potential of failure. While binary economics inspired the creation of employee stock ownership plans (ESOPs), its economic principles have yet to be fully implemented in a way that increasingly broadens capital ownership and creates a sustainable economy. Thus, some could argue that it is an unproven idea. Flying at Mac 20 was also an unproven idea until it was not. With regards to the high potential of failure, I view this in the context of a highly competitive grant competition, rather than failing in terms of the approach. Having spent many years exploring the approach with Prof. Robert Ashford, I feel confident it has the potential to reduce inequality and stimulate significant economic growth. The basic idea is that if everyone received an additional and growing income from capital ownership, they would spend this money on goods and services, stimulating further growth (‘binary growth’). Given the potential negative environmental impacts of this growth, our proposal developed an innovate way to finance the growth of inherently sustainable goods and services. The problem statement from our proposal clearly explains the combination of these two ideas.

Few people today produce enough to take care of themselves or their families. Labor, the main source of economic productiveness prior to the industrial revolution, has declined in relative productiveness as labor-displacing technology advances and becomes hyper-productive in comparison to labor [see the Second Machine Age]. These trends are driving the growth in inequality and the erosion in labor earning capacity, with the ownership of productive wealth being highly concentrated, and with most people owning little or nothing. Attempts to generate equitable growth via government stimulus or austerity programs have failed.

A second critical and related problem is the negative environmental impacts that accompany technology-fueled growth. The Rio+20 promise of a Green Economy has yet to truly materialize, but simply going green is not enough. A new, inherently sustainable industrial revolution is needed, where products and services are produced, used, and disposed of in closed-loop, hyper-efficient systems. A major challenge, however, is the creation of markets for these next-generation products and services. These markets need to provide all people with an equal opportunity to earn incomes from their labor and from a capital ownership stake in the inherently sustainable products and services they benefit from.

When put together, these two macro problems – i.e., inadequate income and the negative environmental impacts of growth – underlie most of the major challenges facing humankind. The fundamental problem addressed by this proposal is how to create Inclusive and Sustainable Prosperity for All.

Since we decided to advance a 100&Change proposal in the first week of September (four weeks ago!), I needed to recruit help to make this proposal happen. I decided to focus my sustainability seminar on the topic of binary economics and asked my graduate students to help structure the content of the 100&Change ‘pitch’ video. They willingly agreed to help and spent several weeks reading, learning, and struggling with the ideas before developing what I considered to be a firm understanding of binary economic principles. The pictures below capture some of the ideas we discussed during this learning process. We also developed a number of concept videos that can be viewed here and here.

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While my students helped develop the video (with technical support from TLOS), I was fortunate to have colleagues in the School of Public and International Affairs (SPIA), the Office of International, Research, Education, and Development (OIRED), and the Institute for Policy and Governance (IPG) who both understood the approach and worked hard to help craft a viable project (described below).

This project will make the ownership of capital – a critical and growing form of income – more inclusive by using future capital earnings (future savings) to finance broadening capital acquisition to provide growing numbers of people with capital income. The new capital income will target inherently sustainable goods and services, stimulating innovation and supporting long-term sustainability. As production becomes ever more capital intensive, providing everyone with an ownership stake in capital will be critical to broadly increasing purchasing power, reducing inequality, and fostering sustainable communities.

Because most people lack the capacity to generate past savings, there must be a shift to using future savings to finance new capital. Presently, almost all capital acquired by corporations is acquired with the earnings of capital, and much of it is acquired with borrowed money. The new mechanisms developed by the project team will open to all people the techniques of corporate finance that will broaden capital ownership and provide beneficiaries with a growing capital income. Because present demand for the employment of capital and labor is dependent on expected demand for goods or services in a future period, a voluntary pattern of steadily broadening capital acquisition promises more production-based consumer demand in future years and therefore more demand for a fuller employment of labor and capital in earlier years. Further, the targeted use of newly acquired capital income to purchase inherently sustainable goods and services will significantly expand the market for these goods and services, creating powerful incentives for innovation.

What is perhaps most interesting about this experience is that while I initially viewed the challenge of creating a 100&Change proposal as a moonshot, the more we worked on the idea and began to form the team, the more it became a realistic possibility. My graduate students proved to be the best critics of the ideas we were exploring and played an important role in framing the approach to the project. In many ways, as the proposal evolved, so too did the team’s confidence in what we could accomplished with binary economics. Our final 90-second video (below) is ‘one small step’ towards a broader understanding of the approach.

After completing our proposal, I started watching the other 100&Change videos on YouTube and realized that our approach could finance those ideas focused on the creation of inherently sustainable goods and services. Thus, if you find yourself wondering what inherently sustainable means, take a look at the available videos and get inspired.

UAP 5784 – Technology, Globalization, and Sustainable Development

3 08 2014

This fall semester I will be offering a graduate seminar focused on Technology, Globalization, and Sustainable Development (UAP 5784; 3 Credits)

Book Review: “This astonishing book is a terrific summary of informa¬tion for those seeking feasible alternatives to the pursuit of infinite growth.” Dennis Meadows, co-author of The Limits to Growth

Book Review: “This astonishing book is a terrific summary of informa¬tion for those seeking feasible alternatives to the pursuit of infinite growth.” Dennis Meadows, co-author of The Limits to Growth

The seminar will meet on Fridays from 12:30pm to 3:15pm, in the Architecture Annex, room 111.

The seminar is designed to provide students with a transdisciplinary perspective on sustainable development. It is intended for students interested in planning, policy, economics, business, innovation, environmental studies, and law. The seminar will explore the many dimensions of sustainability and how national, multinational, and international political and legal mechanisms can be used to further sustainable development.

During the seminar we will consider the inter-relationship of global economic changes, inequality, employment, worker health and safety, and environment in the context of theories of development, trade, technical and organizational innovation, and employment. Mechanisms for resolving the apparent conflicts between these elements will be explored.

This new book will be available in August/September, 2014.

This new book will be available 2014/2015.

The seminar is intended to stimulate discussion and critical thinking on the key writings in sustainable development. Students will be evaluated on the basis of their mastery of the materials through (1) written assignments and (2) class participation and attendance. The seminar has two required texts (see images) that will be supplemented by topical readings tailored to student interests.

During the semester, I will use Google Glass and other video capture devices/software to provide students with enhanced feedback on their assignments and performance in the seminar.

Robert Ashford to Visit VT

13 09 2013

Ashford-Robert Photo 2013I’m pleased to announce that Prof. Robert Ashford will be visiting Virginia Tech in November, during which he will take part in a series of events related to the concept of Binary Economics. The first of these events will be a SPIA seminar on November 6, during which Robert will make the case for “democratizing capital acquisition” by broadening competitive market opportunities to acquire capital with the earnings of capital – see the flyer below for more information about this talk.

Over the past several years, I have had the opportunity to work with Robert, leading to the two papers below published in the European Financial Review.

Ashford_poster-Nov6I first became aware of binary economics when searching for alternative, transformational models of development. The importance of identifying new development pathways has only intensified following the recent global financial crisis that has deepened economic inequality both within and between nations. Robert’s ideas relating to binary economic growth hold great potential to transform and reignite the economy. My interest in this subject, and reason for bringing Robert to VT with the assistance of an AdvanceVT grant, stems from the need to ensure that any surge in economic growth does not also create a surge in negative environmental and social externalities. My hope is that we can find ways to stimulate binary growth while transforming industrial systems towards inherently sustainable practices.

Mindful Learning with Glass

11 07 2013

booksAbout a year ago, I undertook a Faculty Development Institute (FDI) course on Strategies for Mindful Learning that planted the seed for my current project using Google Glass. With the fall 2013 semester approaching, I decided to revisit Ellen Langer’s book entitled The Power of Mindful Learning that accompanied the FDI course in search of mindful learning strategies.

My challenge this coming semester is how to effectively use Glass to augment my seminar on Technology, Globalization, and Sustainable Development. My initial idea is to record videos that will enable students to follow my thought process in creating the seminar as we go – i.e., to hear me narrate about why I included or excluded certain subjects or material, what advice I was given by mentors/colleagues in the design of the seminar (including, for example, how their facial expressions added weight to the subject matter selected), capturing conversations with guest speakers about what they could cover before they speak in the seminar about a narrower subject matter, etc. The basic idea is to capture the “behind the scenes” aspect of the seminar, which is often where much of my insight and learning occurs.

While the students will not have access to the Glass device, I will challenge them to capture in a blog post (or something similar) how they approached an assignment and what ideas/thoughts came to their mind when crafting their response. The purpose of this reflexive writing is to help students better understand their perspective on the subject matter and provide me with some insight into their frames of reference.

As Langer (1997, p. 138) writes, “When we are mindful, we recognize that the way in which we tend to construct our world is only one construction among many.” For me, this sentence captures the essence of what Langer is writing about. Being mindful is about being open to new information and to new ways of thinking or categorizing information, and recognizing that multiple perspectives are possible. Soderbaum-4As I reread Langer’s text, it reminded me of a productive interaction I once held with Peter Söderbaum about his notion of Positional Analysis (PA) and the importance of conditional conclusions. Any conclusion (or policy, strategy, program, etc.) is conditional in relation to the ideological orientation (i.e., perspective) from which it is considered. Put simply, a conclusion may look promising from one perspective, but have major drawbacks when considered from a different perspective. Peter’s idea is to promote learning by recognizing that there is no best or optional solution, but rather a range of solutions that look quite different depending on one’s ideological orientation.

My challenge this fall will be to mindfully explore with students one of the most important and complex subjects facing humanity – sustainable development. Langer’s strategies to promote mindful learning will surely assist in this task. One of the first discussions I will have with students will consider how our automatic organization of perception/information (see Langer 1997, p. 103) may limit our ability to see potential solutions to the problems we face. [I will also link this discussion to the problem of source amnesia (see Langer 1997, p. 86).] One could argue that our need to simplify or box issues into silos results in the single-purpose design of policies that fail to comprehensively address unsustainable development. In response to this challenge, Nicholas Ashford and I have called for the multi-purpose design of policies that integrate issues such as industrial policy, meaningful employment, environmental protection, competiveness, and trade initiatives into long-lasting sustainable development. It will be interesting to see whether adopting a mindful learning strategy throughout the semester will lead to new insights that can help advance sustainable development. I’m looking forward to the possibilities.  In the words of Langer (1997, p. 5), “Everything is the same until it is not.”

Congratulations Yakhya Diagne!

20 06 2013

In May 2013, Yakhya (Aicha) Diagne successfully defended her thesis entitled “Planning for Sustainable Development in Senegal.” Aicha’s research focused on understanding the complex institutional, legal, and political aspects of sustainable development planning in Senegal and identified options to advance the national planning framework to promote more sustainable forms of development. Aicha received a 2012 ThinkSwiss research scholarship that enabled her to undertake part of her research at the UN in Geneva, Switzerland.Aisha_Paris

Prior to coming to Virginia Tech, Aicha led the Office of Legal Affairs, Communication, Monitoring, and Evaluation in the Senegalese Department of Environment and Classified Establishments. She also managed the Technical Permanent Secretary of the Senegalese National Commission of Sustainable Development from 2008 to 2010.

Aicha is currently undertaking an internship at the West African Development Bank in Lome, Togo. After completing the internship, she will begin a position in the Ministry of Environment and Sustainable Development in Senegal.

I served as the chair of Aicha thesis committee, along with committee members John Browder and John Randolph.