Seven Ways to Think Like a 21st-Century Economist:
Kate Raworth
: 9781603586740: Amazon.com: Books
Economics is the mother tongue of public policy. It dominates our decision-making for the future, guides multi-billion-dollar investments, and shapes our responses to climate change, inequality, and other environmental and social challenges that define our times.
Pity then, or more like disaster, that its fundamental ideas are centuries out of date yet are still taught in college courses worldwide and still used to address critical issues in government and business alike.
That’s why it is time, says renegade economist Kate Raworth, to revise our economic thinking for the 21st century. In Doughnut Economics, she sets out seven key ways to fundamentally reframe our understanding of what economics is and does. Along the way, she points out how we can break our addiction to growth; redesign money, finance, and business to be in service to people; and create economies that are regenerative and distributive by design.
Named after the now-iconic “doughnut” image that Raworth first drew to depict a sweet spot of human prosperity (an image that appealed to the Occupy Movement, the United Nations, eco-activists, and business leaders alike), Doughnut Economics offers a radically new compass for guiding global development, government policy, and corporate strategy, and sets new standards for what economic success looks like.
Raworth handpicks the best emergent ideas―from ecological, behavioral, feminist, and institutional economics to complexity thinking and Earth-systems science―to address this question: How can we turn economies that need to grow, whether or not they make us thrive, into economies that make us thrive, whether or not they grow?
Simple, playful, and eloquent, Doughnut Economics offers game-changing analysis and inspiration for a new generation of economic thinkers.
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Top customer reviews
Gary Moreau, Author
TOP 500 REVIEWER
5.0 out of 5 starsAs a trained economist, hardened corporate warrior, and a father, I say you can't NOT read this bookDecember 11, 2017
Format: Kindle EditionVerified Purchase
This is an incredible book, but what is most incredible of all is that after ten months of availability it currently ranks 40k+ in Amazon’s sales ranking and has only 40 reviews. That still puts it in the top tier of books, mind you, but this book should be in a tier by itself. It is truly transformative. (I only discovered it due to a comment written in response to the review of another book.)
Kate Raworth, who trained in economics at Oxford, has never quite felt comfortable in her chosen field of study. And for good reason. The neoliberal economic model that has guided us for the last three or four decades, based on fundamental assumptions that pre-date us all by several generations, are not so much flawed as they are misaligned, to the point of actual destruction, to the social, economic, political, and environmental world in which we live the 21st Century.
As an economics major myself back in the 1970s, and a corporate warrior who lived, breathed, and trusted the neoliberal creed for four subsequent decades, I am both an unlikely and uber-supporter of Raworth’s perspective and ideas.
The markets and the consumer are decidedly not efficient; as every leading economist has assumed but every businessperson knows is bullocks. If they were, strategic planning would be a lot more straightforward and companies would be a lot more consistently successful. Companies would not have to constantly reinvent themselves, the turnaround experts and bankruptcy attorneys would have little to do, and investors could take long holidays on the private islands they could easily afford.
The resources we rely on are not unlimited. Why are we arguing about the science of climate change? Look around, and if you still don’t see it, sit down and take an inventory of the resources you personally consume and plot it against whatever happiness index you like. The imbalance, you will quickly conclude, is absurd.
I lived as an ex-patriate industrialist in a part of the world where you could not drink the water or, on many days, breathe the air. On both counts I am being quite literal. And I can tell you that on both counts nothing else matters. Now back in the US Midwest I can tell you both that I continue to pay the price and that our collective attitude here in the developed world toward these issues is conscious but dismissive. In short, we have been spared true understanding in the same way the blind are spared having to look at the ubiquitous “comparative selfie” that seems to be the single most transformative accomplishment of social media at the moment.
We do not assign value to the economic inputs and the assets that really matter. There is no place on the balance sheet for engagement or innovation, and nowhere is there an accounting for shared (what Raworth calls common) assets, like safety, education, infrastructure, the country’s defenses, etc. We’re measuring well-being by the quality of the creases in our trousers.
I could go on, but there is no need. Raworth has already completed that task. Which is why this book should be required reading for every adolescent in every corner of the world. The universe is interconnected in ways that we have known, but largely ignored, since the beginning of time. We see the world in a linear framework that reflects and reinforces our deductive worldview in which logic and reason progress from left to right and down to up. Our top is where our smarts reside. Our backs contain the backbone that carries the weight of our ever-extending bellies (mine at least).
Nowhere in economics has this been more obvious or more damaging to our long-term interests than our pre-occupation with economic growth. It’s not an assumption, really. It’s a necessity. As we’re reminded daily, we need economic growth to keep people employed and wages rising. Without new air going in each and every moment, the balloon deflates. Doesn’t that mean, however, that at some point the balloon reaches its innate capacity and ultimately bursts?
Raworth’s perspective is spot on and the writing is excellent. She has an obvious knack of distilling what may at first seem complex down to the simple and straightforward without losing anything in the translation.
I think of the debate in more personal terms. We currently see our world through a very individual-centric lens. In economics, as Raworth covers here, the macro exists to serve the micro. In politics we are motivated by individual rights and freedoms. In medicine we focus on individual health and well-being. Even in psychology we are absorbed with personal happiness and personal measures of purpose and contentment.
The result is that our political, social, economic, and even religious spheres of influence operate in independent isolation. And that was okay in the past since there were far fewer of us, resources were in abundance, and we lived and acquired information and knowledge in a largely local ecosystem.
But technology, population growth, and constant advances in science have changed all that. Those spheres are now completely inter-connected. Social media drives politics. Politics drives social identity. Economics drives social injustice. The need for security impinges religious freedom.
Raworth’s donut is the perfect visual analogy for the need to think less in terms of absolutes and more in terms of balance. I also think of it in terms of balancing the deductive Western worldview with the more inductive Eastern worldview. Most importantly, we must learn to think in terms of “we” rather than “I.”
All of our systems of influence, from the political to the economic, must be transformed to promote collective balance rather than individual hegemony.
In the last sections of the book, Raworth addresses the question of the era: Can the plane of economic growth, as we currently define it, continue to soar ever upward; must it level out, and if so how do we fulfill our economic expectations; or is it time to land and make do?
As with the rest of the book Raworth does the conundrum justice and lays out all of the options thoroughly and with clarity. I think there is only one element that is not missing, but perhaps deserves more emphasis.
We continue to treat economics, politics, philosophy, sociology, psychology, and the hard sciences as distinct and discrete spheres of knowledge and influence. With advances in technology that have entirely transformed all aspects of our lives, that is simply no longer possible. We must take a page from our leaders in science who are quickly integrating all functional disciplines into, essentially, one. That is how the universe ultimately works.
One of the arguments for pushing the plane higher and higher is the recognition that democracy, as we have known it, will die if we don’t. It is, however, already dying, if not already dead. The democratic justification for growth, in other words, is a specious argument. We must redefine what it means to be free.
To borrow a page from Darwin, none of the current disciplines will give up its identity quietly (With perhaps the exception of philosophers, who have largely given up or gone into hiding. Sadly.). Each will fight to the death to preserve its own privilege.
It’s a bit like the game of Jenga. Who goes first?
I won’t say Raworth would endorse this priority but she certainly makes the case for it. I think the first to go has to be the notion of shareholder supremacy. It is an anachronism of the most abusive kind, positing, as Raworth notes, employees as the ultimate outsiders looking in. It’s an unsustainable model. And it’s pure fallacy. To say that today’s investors own our corporations is like saying that the gamblers own the casinos. (At least in the case of gambling, the gamblers at least set foot in the casino.) As in the case of poker, the gamblers may own the pot, but not the cards, the table, or the dealer.
And, as Raworth futher notes, changing the perspective will require a complete transformation of the process by which we currently manage our largest corporations. So be it. If it doesn’t start there, I don’t think any of the other transformative needs are feasible.
Beyond that I believe that the only viable option for transformative change is to address the problem from the consumption and expectation side of things. We just don’t need all of this “stuff” in order to live fulfilling lives. We can and should live much more locally. And technology has given us the perfect opportunity.
What really matters in life is to think and dream globally and the Internet has given us that opportunity at next to zero cost. The next step should be an easy one although no gambler ever got rich betting against the power and resilience of those entrenched interests who wish to protect the status quo. (Which is why our politics are such a mess.)
At any rate, this really is a great book and I do hope we can collectively push it to the top of the bestseller list where it belongs. It’s a discussion we need to have, not just with our economists, but with our children, our colleagues, and our loved ones. (Not to imply we don’t love our children.)
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JIm H
5.0 out of 5 starsWonderful bookApril 14, 2017
Format: HardcoverVerified Purchase
I was a little skeptical at the thought of another book on economics, so I opted for the cheaper kindle version. After twenty minutes with the book, I was so impressed that I also ordered the hard back version so that our hard-pressed library can have a copy.
I've realized recently that our way of thinking about economics has led into a political cul-de-sac. This book has answers that ring true.
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Jaal
5.0 out of 5 stars
A Deeply Important Work
April 17, 2018
Format: Audible AudiobookVerified Purchase
Perhaps one of the most important works of socioeconomics seen in the last 50 years. Rather than simply identifying problems, Raworth presents a comprehensive and beautifully designed framework for overcoming the problems we face -- a true socioeconomy for a new century -- a century with a unique and never-seen-before set of inherited structural dangers and breaking points.
Raworth's brilliant whole-planet thinking will certainly be held among the great economic architectures of the 21st century, a prototype for the absolutely necessary requirement to change our old (and deeply entrenched) ideas of "unlimited growth" into something sustainable for all earthly inhabitants. Brava, Kate, for gently leading us out dangerously antiquated thinking and into far smarter ways of understanding what it means to thrive and prosper and be a human community.
Raworth presents a scientifically-based mix of market solutions constrained by sensible government regulations. They may not be the kind of regulation some like, such as those who deny anthropogenic climate change or the toxic global impact of CO2-loading, ocean acidification and microplastic gyres, soils depletion, rain-forest depletion, aquifer depletion, population growth, deepening socioeconomic non-linearity. First-world neoliberal policies have artificially decoupled all of these issues from economic theory. Such policies are killing our shared resources, our commons.
Neoliberal. Alas, no word more properly embodies the reigning ideology of our era - one that venerates the logic of the market and artificially strips away the things that make us human. Some (like me) see this as a fatal flaw, while neoliberals see this as the ideal economic theory.
One two-star commentor makes the immediate black/white jump to -Marxist revolutionary socialism- without bothering to address her key points, which have everything to do with science, survival, and behavioral economics, and nothing to do with Marxism or overt central control. Self-defined -libertarians- usually exhibit an undeveloped sense of our planetary commons and a dismissive attitude towards planetary science, throwing around words like Marxist. Raworth's arguments are deeply nuanced and decidedly not "Marxist" but rather call for balanced policy intervention, much like the modified free-market social democracies of Sweden, Germany, NZ, etc..
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Peter T. Knight, PhD
5.0 out of 5 stars... "what is to be done" to make the discipline useful in the 21st centurySeptember 15, 2017
Format: Kindle EditionVerified Purchase
Kate Raworth is a (recovering) economist who has identified "what is to be done" to make the discipline useful in the 21st century. I cannot recommend this book too highly. It is easy to read for non-economists, extremely didactic, and builds on the pioneering work of Herman Daly and other ecological economists, adding a political economy perspective. Up-to-date. Deals with all the subjects we work on in the Sufficiency4Sustainability Network except AI is not specifically mentioned (but robotics is treated in some detail) and other exponential technologies developing at the rate of Moore's and related laws (e.g. biotechnology, nanotechnology) are not dealt with. Raworth makes good use of the (unhealthful) doughnut image contrasting it with the traditional "circular flow" diagrams introduced in textbooks by Samuelson so long ago and still taught, though they treat important issues such as pollution as "externalities" and focus on marginal changes when we are living through an age with a "full world" where ecological limits are being exceeded or are being approached as Daly would say and revolutionary advances in technology make marginalism irrelevant.
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