By Costanza, Robert
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Extra resources for An Introduction to Ecological Economics
Soddy was considered an outsider and a “monetary crank” by mainstream economists. org/2012/08/nationalize-money-not-banks-byherman-daly/).
Frank Knight (1895–1973), for example, expounded at some length on recent developments in physics and their implications for economic theory and methodology (Knight 1956). By the latter half of the twentieth century, however, transdisciplinary scholarship was extremely rare. During the second half of the eighteenth century, at a time of great social change and scientific promise, the formal field of economics emerged from moral philosophy (Canterbury 1987; Nelson 1991). Long-standing moral questions with respect to the obligation of individuals to larger social goals were being challenged by the development of markets and scientific advances, both of which brought new opportunities for personal material improvement and fueled great hopes for a plentiful future.
The logic that capitalists and high-income earners had a greater marginal propensity to save, combined with the importance of investment for growth, led to the conclusion that inequality fostered growth. Robert Solow’s growth theory suggested that with low initial labor and capital productivity it was assumed that less developed countries (LDCs) would “grow” at a faster rate and would attract the bulk of international investment. This assumption remains today and is often invoked, along with the theory of comparative advantage, as the rational for liberalization policies (Stiglitz 2002, 59).