Commoditization and Consumption Efficiency: Contributions to Theory in Ecological Economics

1
Commoditization and Consumption Efficiency
Contributions to Theory in Ecological Economics

• Jack Manno
• New York Great Lakes Research Consortium
• SUNY College of Environmental Science and Forestry

2
Theory needs

• Theorize the evolution of unsustainable economic
  patterns.
• Describe structures and mechanisms determining
  and governing these patterns.
• Go beyond I f(population x affluence x
  technology).
• Link the personal and the political.
• Identify key points of leverage for solving the
  problem of sustainable development .

3
Sustainable development

• The challenge for ecological economics
• How do we create and sustain ways of livelihoods,
  communities, nations and world where people
  prosper without undermining the life support
  systems upon which all prosperity ultimately
  depends?

4
The economic key to solving this problem

• Increasing Consumption efficiency,
• welfare produced
• CI
• energy and material resource
  consumed
• welfare the satisfaction of human need.
• Marginal Consumption Efficiency is the amount of
  welfare produced per any given additional unit of
  energy and material consumed in the satisfaction
  of any human need.

5
Improving consumption efficiency?

• Sufficiency/frugality (living simply, lightly on
  the earth)

6
Improving consumption efficiency?

• Sharing

Sharing
7
Improving consumption efficiency

• prioritizing synergic satisfiers

subsistence, protection, affection,
understanding, participation, leisure, identity
and freedom.
freedom, leisure.
Manfred Max-Neef
8
Improving consumption efficiency?
Through biomimicy, ecoefficiency, designing with
nature, appropriate technology Nature as Model 
Biomimicry is a new science that studies
nature's models and then imitates or takes
inspiration from these designs and processes to
solve human problems, e.g., a solar cell inspired
by a leaf. Nature as Mentor  Biomimicry uses
an ecological standard to judge the "rightness"
of our innovations. After 3.8 billion years of
evolution, nature has learned What works. What
is appropriate. What lasts. Nature as Measure 
Biomimicry is a new way of viewing and valuing
nature. It introduces an era based not on what we
can extract from the natural world, but on what
we can learn from it. Janine Benyus (1997)
Biomimicry Innovation Inspired by Nature.
9
Improving consumption efficiency?
Through eco-synergy, synergism, permaculture for
example The Three Sisters Corn, beans and
squash
Squash
Corn
Bean
10

• Effective means of increasing consumption
  efficiency (welfare/consumption) involve and
  require relationships, relationships between
  people, between people and the land.

The Community Organic Food Garden Vancouver, BC?
11
Its not the earth that needs to be healed but
our relationship to it. Robin Kimmerer
Its not a matter of belongings but a matter of
belonging. Robin Kimmerer
12
Commoditization theory

• there exists a powerful tendency to privilege
  (favor) those satisfiers with the greatest
  commoditization potential in a competition for
  limited resources (attention, power, and material
  inputs) among competing satisfiers to meet any
  and all human needs and desires.
• In the competition for energy and material
  investments, those satisfiers with
  characteristics that make them fit for
  functioning as a commodity will always
  out-compete those less able.

13
In order of descending priority potential waste
reduction and pollution prevention effectiveness
Reuse
Recycle
Recover
Manage
Reduce

• Reduce packaging and materials in products.
• Make products that last longer and are easy to
  repair, recycle, reuse.
• Change industrial processes to eliminate use of
  harmful chemicals.

• Reuse products.
• Repair Products.
• Compost.
• Buy reusable products.

• Recycle products.
• Buy recycled products.

• Treat waste to reduce toxicity.
• Incinerate waste.
• Bury waste in landfills.
• Release waste for dilution or dispersion into the
  environment.

• Recover embodied energy and materials

The highest priority and greatest potential
effectiveness also has the least commoditization
potential. The greatest share of waste-related
dollars goes to the lowest priority, i.e., waste
management.
14

• What are the qualities that characterize
  something as being subject to the pricing
  mechanism, in other words, what makes something a
  commodity?
• Not all satisfiers have equal potential to
  function in an economy as a commodity.

Home
House
15

• The fundamental distinction b/w commodities and
  non-commodities lies in whether value can be
  alienated from relationships.
• The basic feature of something that can function
  as a commodity is that its needs-satisfying
  character can be extracted and readily
  transferred to a buyer.
• Non-market values are typically those values that
  exist in relationships between and among people
  or between a person or a group of people
  (community) and a place.
• Changes in the relationship result in changes in
  the welfare-producing value.
• One party to the relationship cannot transfer it
  to another party, the other party needs to first
  establish its own relationship.

16

• The net result of the constant privileging of
  commodities over non-commodities is an
  evolutionary process of development that
  hyper-develops commodities and under- develops
  relationships, leading to a distortion of overall
  economic development, maldevelopment,
  unsustainable development.

17
Sector High Commoditization Potential (Commercial goods) Unlimited market/ value independent of relationship Walmart Medium Commoditization Potential (Exchange goods and services) Local market/value affected by relationship/ difficult to separate Farm market/craft market/hands-on service Low Commoditization Potential (Relationships) Limited or no market/ value determined by relationship/almost impossible to separate No market except direct exchange
Childrens Play Barbie dolls, Action figures, packaged entertainment Handicrafts, childcare, live entertainment Direct child-led interaction with natural surroundings, group play, interpersonal goods
Food production Commercial fertilizers, pesticides, engineered seeds, mechanization tools, genetic material Commercial manure, stored seeds, farm animals, tools for small farm, agricultural extension and research services. Knowledge of soil, locally co-evolved skills and techniques
Health care Mass-marketed drugs, diagnostic equipment, hospital supplies, insurance Doctor-provided services, hands-on therapies and treatments Knowledge of healing, personal health maintenance and illness prevention, life-style adaptations, sense of well-being
18
Table 1(continued). Commoditization Potential
Sector High Commoditization Potential Medium Commoditization Potential Low Commoditization Potential
Energy Grid-dispersed electricity, power plant equipment, fossil and nuclear fuels Renewable energy sources, energy conservation services, wage labor Personal energy conservation strategies, passive solar design, cooperative sharing activities
Transportation Personal transport vehicles and the infrastructure of roads, etc. that supports it Public transportation Transportation reduction strategies (such as cluster housing near workplaces, etc. ), walking
Environmental Protection Pollution control equipment, waste-to-energy incinerators and equipment Recycling, pollution reduction/prevention services Pollution prevention redesign, materials and energy use reduction strategies
Mental Health Mood altering drugs Therapists, Fitness clubs Peer counseling and mutual help, friendship, exercise
Finance/credit Options, junk bonds, credit cards Neighborhood banking, credit unions Personal loans, gifts
19
Attributes of Goods and Services and their
Effects of Commoditization on Development
Attributes of goods and services with Attributes of goods and services with Effects of Commoditization Effects of Commoditization
HCP LCP Negative Effects Positive Effects
Alienable, Excludable, Enclosable, Assignable, Patentable simpler to establish right of ownership, easier to establish price. Openly accessible, inalienable difficult to establish rights, widely available, difficult to accurately price Privatization accelerates decline of sense of community and the common good and increases commoditization of all aspects of life. Skills and capacity for managing common property and promoting common good is underdeveloped. Releases individual and corporate entrepreneurial energy. Ability to manage individual property and promote personal gain is highly developed.
Standardized, Universal, Centralized and Uniform adaptable to many contexts. Particular, Customized, Decentralized and Diverse each culture potentially derives the best practices for its particular environmental context leading to diverse customized goods and practices Reduces cultural and geographic diversity, standardized methods may not be suited to particular ecosystems, as a result efficiency potential is reduced. Locally appropriate development options remain underdevelopment. Allows rationalization of production economics of scale and transfer of skills. Greatly increases production efficiency.
20
Table 2.(continued) Attributes of Goods and
Services and their Effects of Commoditization on
Development
Attributes of goods and services with Attributes of goods and services with Effects of Commoditization on Development Effects of Commoditization on Development
HCP LCP Negative Effects Positive Effects
Autonomous, depersonalized, use or practice occurs largely independent of social relationships. Primary relationship is between consum-er and product. Embedded, use or practice occurs in a web of social and ecological relationships. Promotion of individual consumption reduces the efficiency gains made possible by sharing, in-creases flow of energy and materials. Excessive autonomy undermines social relationships, redundancy and resilience. Minimizes the complications of relationships. Advances freedom of the individual.
Embedded knowledge or skills, convenient, use simplified and inherent in design and material. Disperse knowledge and skills, convenience is not goal, use requires relevant knowledge and skills Impoverishes knowledge base particularly at the personal, local and regional levels. Convenience frees human attention for other activities.
Mobile, transferable, easy to package and transport Rooted in local ecosystem and community Propensity for mobility increases flows and export of energy and materials. Local knowledge and connectivity underdeveloped. Makes trade possible with accompanying spread of benefits. Trade and markets become highly developed.
21
Global Ecosystem
WASTE HEAT
SOLAR ENERGY
Expanding Economic Subsystem
Advertising other Consumption Stimulants
Expanding Material Demand Human Needs
Expanding HCP
High-entropy Matter/energy
Economic Nutrients (capital, raw materials, human
attention)
Expanding HCP RD
Expanding Population
Shrinking LCP
Shrinking LCP RD
Low-entropy Matter/energy
The process of commoditization.
22
Next Steps in Developing Commoditization Theory

• Developing measures of commoditization potential.
  
• Conceptualinzing the two economies the economy
  of commodities and the economy of relationships
  (an economy of care and connection).
• Developing the proper balance between the two.
• Developing the concept of attention as a scarce
  resource.
• Policy.

23
(No Transcript)
24
Remember the key to healing our relationship to
the Earth is paying attention. You have the power
to decide where to place your attention.