Abstract
This chapter delves into the model economy to explore how flows of materials and money within it affect its long-term prospects. The economy is divided into three major subsystems: Production, Consumption and Regeneration. A fourth subsystem, Government/Regulation, monitors natural capacity and regulates material and money flows accordingly. In addition to flows of material, the model tracks gross global product (GPP) per capita as a rough measure of prosperity. The results indicate that the exercise of material discipline, such as by recirculating material within the economy, leads to long-term stability and increased prosperity.
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Notes
- 1.
Meadows et al. (2004, p. 209).
- 2.
Odum (1994, p. 12).
- 3.
Odum (1994, p. 479).
- 4.
“Economists,” Boulding (1962, p. 135) wrote, “have frequently written as if consumption was the desideratum” thereby conflating consumption and satisfaction derived therefrom.
- 5.
See, for example, Goodwin et al. (2009, p. 251).
- 6.
See, for example, Goodwin et al. (2009, pp. 138–140).
- 7.
Georgescu-Roegen (1971, pp. 217–218).
- 8.
Goodwin et al. (2009, pp. 79–85).
- 9.
- 10.
- 11.
Clark (1990, pp. 122–130).
- 12.
In the case of mineral resources, it would be a rate at which new economic sources are discovered.
- 13.
Meadows et al. (2004, p. 221).
- 14.
Meadows et al. (2004, pp. 277–278).
- 15.
- 16.
Tukker et al. (2006).
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Murison Smith, F. (2019). Subsystem Model of the Economy. In: Economics of a Crowded Planet. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-31798-0_4
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DOI: https://doi.org/10.1007/978-3-030-31798-0_4
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