Summary: Sustainability Economics
HOC 1: Sustainability Economics
1.1 What is Sustainability?
Sustainability 1.0: “meeting the needs of the present without compromising the ability of
future generations to meet their own needs.”
à Fulfillment of human needs & continuation overtime, so that we don’t damage the
possibility of future generations.
3-legged stool model
- Economy: Healthy firms, that can operate and don’t go bankrupt
- Social equity: Giving people access to participate in society
- Environment: Planet
Sustainability is built on these 3 pillars!
Another way to also look at these 3 pillars is: 3 P’s (profit,
people and planet). But people tend to focus mostly on
the ‘profit’ aspect.
They both have common operationalization, but this is
also evolving and moving ow to prosperity (= wealth) as a
different way of looking how we can fulfill human needs
and cp-living with a natural world as humans and
societies.
Overlapping circles model:
You have a sweet spot in the middle where you’ve all the
aspects of the three domains; it’s economic, social and
environmentally healthy.
- The human system is depending on the
ecosystem, but the ecosystem is also shaping the
human system.
- The economy is depending on the biosphere air,
resources, stable climate in which we can operate.
- Social-economic system is dependent on society,
healthy workers, democratie, education…
- So all 4 are co-creating and depending all on
another!
Insd 1
,Sustainability 2.0: Sustainability refers to sustaining the underlying pattern of health,
resilience, and adaptability that maintain this planet in a condition where life as a whole can
flourish and that for this to be possible in the long term, the way modern societies organized
shouldn’t be sustained, but rather re-designed using a regenerative perspective
à So you can have a healthy system functioning also overtime
à The definition of sustainability 2.0, is looking how can make it regenerative and thrive in a
good way and not just doing less harm, or continuing what we’re doing but just greener (like
sustainability 1.0 was doing)
à We don’t want just in the long term to change a bit the current system, we really want to
transform, and redesign based on a regenerative practice! So, it can start flourishing again!
Three nested model (embedded model):
Environment, society and economy are clearly linked in a nested model. You can see that
‘economy’ is a smaller set than the 2 other ones, because our economic transactions, to have
a good well-being are just a small part of the system! We’ve way more social transactions
outside the economy, like visiting your family/friends, enjoying cultural activities…
à Society is way more than economy, and both are
dependent on a healthy environment to have food, clean
air
à This is a more social ecological embedded view on the
economy, that ecological economists are taking as a
starting point to start doing the analysis; an economy
being service of the society & the environment = THIS IS
THE VISION WE WILL ADOPT IN THIS CLASS!
1.2 What is sustainable system?
Sustainability requires change:
- To be sustained: The living world we want to sustain
- To be changed: Things that need to change, in order for environment to be held
sustainable and also balancing feedback between people, economy and society… All
these human maids; how we perceive life, structures we developed, our current
economic system that is driving around economic growth… All these aspects need to
be changed, to move towards a sustainable economy!
Insd 2
,Sustainable & Equitable allocation of resources?:
The economy is taking planetary resources and allocating it in a inefficient way towards
human needs, and human well-beings that are being of service of certain communities. It
could be that it is ecological efficient, but it could also be that it’s inefficiently allocated, f.e.
people having their private swimming pools, jets…
So there’s a huge difference between the resources that we have and how they’re going to
be allocated in societies!
Planetary resources: Natuurlijke hulpbronnen, bv.water
Social resources: Niet-materiële menselijke en maatschappelijke elementen, bv. onderwijs
Sustainability economics: Economics is the study of scarcity and its implications for
the use of resources, production of goods and services, growth of production and welfare
over time.
à This is a definition that focuses on scare resources to meet various competing ends. These
resources could be: social human, physical and natural.
Other view to look at it: They’re certain human needs and several ways to fulfill them. So
maybe now, in our consumer society we’re not always using the right resources in a good
way to be able to fulfill these needs!
For example: We think we want to buy something fancy, but we actually want is connecting
with others, so maybe there’re something else we actually need, instead of the product that
advertisers try to sell to us!
Insd 3
,Profit as a means (= financiële middelen) or as an end?
By selling products, they want to make products for their shareholders, but there’s a
difference between what people need and be good for the planet and pure profit making
maximalization.
So there’re different means, that translate into different ends. And profit or economic
growth are maybe not the right goals to pursue… We should focus on something else!
Value management: How to balance the needs and set priorities?
There’re different values to be managed in our economy. (100% EXAM QUESTION)
Insd 4
,Planet boundaries: This image represents the Planetary Boundaries Framework, developed
by the Stockholm Resilience Centre, which identifies nine key environmental systems that
regulate Earth's stability. In this image we’re crossing 4 boundaries. (YOU DON’T HAVE TO
KNOW THIS IN DETAIL!)
The Colors
🟢 Green = Safe
🟡 Yellow = Some risk
🟠 Orange = High risk (we have gone too far)
The 9 Planetary Boundaries:
1. Biodiversity Loss – Too many species are
disappearing. This weakens nature.
2. Climate Change – Too much CO₂ is warming
the planet, causing extreme weather.
3. Deforestation – Cutting down too many trees hurts ecosystems and the climate.
4. Freshwater Use – Using too much water can cause shortages.
5. Fertilizer Overuse – Too much nitrogen & phosphorus pollutes water and kills fish.
6. Ocean Acidification – Too much CO₂ makes the ocean acidic, harming marine life.
7. Ozone Layer Damage – Harmful chemicals (like old CFCs) can let in dangerous UV
rays
8. Air Pollution – Tiny particles in the air cause disease and affect the climate.
9. Toxic Chemicals & Plastics – New chemicals and plastic waste (= plastic products)
pollute the environment.
System thinking: The iceberg model
- Events: What we can see
- Hidden: What we can’t see, but this is what shaped these ‘events’
If you look at complex system, you don’t already see the bigger picture; and this is illustrated
by the iceberg model. So, when you look at what is happening in the economies and
societies in the living world, actually only the ‘events’ are visible, so only the top of the
iceberg. There’s much more going on underneath the surface, but it’s not always visible and
more difficult to
discover.
Insd 5
,Different beliefsystems/mental models:
- Homo economics, free market…
- Anthropocentric: This view leads to the
current problematic situation that we’re
having. Human as central in the
economy/biosphere.
- Biocentric: This view focuses more on how
we’re dependent on the living world. Human
as part of the living world.
This image shows the Iceberg Model, which helps us understand why things happen. It tells
us that what we see (the "tip of the iceberg") is only a small part of the whole story.
1 Events (What we see) → "What's happening?"
• This is what we notice right away, like a heatwave, pollution, or deforestation.
• Example: "Oh no! There's a drought!"
2 Patterns & Trends (What happens over time) → "What's been happening?"
• This is when the same things keep happening again and again.
• Example: "Every summer, there are more and more droughts."
3 Underlying Structures (The causes behind the patterns) → "What's influencing this?"
• These are laws, policies, or economic systems that create the patterns.
• Example: "Farmers are using too much water, and governments aren’t managing
resources well."
4 Mental Models (The deep beliefs that shape everything) → "What beliefs cause this?"
• These are cultural ideas, traditions, or ways of thinking that make the system work
like this.
• Example: "People believe water is unlimited, so they don’t save it."
à If we only focus on events, we’ll keep fixing symptoms instead of solving the real
problem.
To create a sustainable system, we need to change the deeper structures and beliefs!
Insd 6
,Transition 1.0: Making the current system work better, without fundamentally changing
the system itself!
- Events: “Yellow jackets” = ‘Gilets jaunes” à People in France are protesting against
the rising fuel prices, that people can’t afford, while they need their car to go to
work.
- Patterens & trends: Incremental steps = Small steps
- ….
Those incremental improvements aren’t fundamentally changing the underlying economic
system; they are just sustaining the current system;
- Same mental models
- Money is still a priority
- Not touching market structures
Transition 2.0: From incremental change to ‘generative’ system
- Events: Purpose investment à They’ve a different mission, not just to make profit,
but really being of service of the people & planet
Insd 7
, - Mental models: Reconnecting worldview à Being connected to each other & the
mature
- Current system: Antropocentric (mental model)
- System shift: Biocentric (mental model)
Transition theory: Overtime systems change, you’ve 3 levels:
- Landscape: Landscape pressure, climate change, biodiversity loss… These have an
influence on our behaviour ( how we eat, travel etc) and can create new
opportunities for niches to build a more established ecosystem.
- Niches: Initiatives that come from the people (f.e. electric cars, organic farming etc),
some fail and some work.
- Ecosystem: These initiatives can lead to a
different ecosystem which evolve overtime
and become more established, and can lead
to a new functioning businesses.
Insd 8
, Transition 1.0: Incremental changes, which is a good thing to do, but isn’t going to
change fundamentally our current system. One system takes over (= ascendency) and
everyone is following the same path (= convergence)
You’ve big corporations becoming dominant like in the fuel industry and they’re just
continuing doing what they’re doing and protecting their own interests, but this
could lead to an adverse effect.
The system is stuck/locked-in in an unsustainable state, where making changes is
difficult.
Transition 2.0: Supporting alternative solutions (= niches) that are resilient, and
different from the mainstream. + Many ideas are tested, it’s diverse (= divergence)
What is a sustainable system?
1) Conventional: Causes a lot of harm to people and the environment
2) Green: “Less harm”, but still not fully sustainable
3) Sustainable: Respects both social and ecological limits
4) Restorative: Actively repairs damage done in the past
5) Regenerative: Creates positive impact and helps ecosystems thrive
Insd 9
, How do systems shift?
- Niches (micro-level): Innocation ideas
- Ecosystems (meso-level): These innovations spread and form new ecosytems and
networks
- Institutions (macro-level): Laws, education etc. change to support the NEW
MAINSTREAM
à Sustainability transitions aren’t lineair, they need cooperation at all levels of society.
Ego: Antropocentric à Focused on self-interest, consumption and competition
Eco: Biocentric à Focused on our connection to nature and others (= intraconnection)
SEVA: Spiritual principle à Helping others because it’s the right thing to do, without wanting
to receive something from them in return
Sustainability economics: Study of economic systems that support human well-being
and ecological health
Insd 10
HOC 1: Sustainability Economics
1.1 What is Sustainability?
Sustainability 1.0: “meeting the needs of the present without compromising the ability of
future generations to meet their own needs.”
à Fulfillment of human needs & continuation overtime, so that we don’t damage the
possibility of future generations.
3-legged stool model
- Economy: Healthy firms, that can operate and don’t go bankrupt
- Social equity: Giving people access to participate in society
- Environment: Planet
Sustainability is built on these 3 pillars!
Another way to also look at these 3 pillars is: 3 P’s (profit,
people and planet). But people tend to focus mostly on
the ‘profit’ aspect.
They both have common operationalization, but this is
also evolving and moving ow to prosperity (= wealth) as a
different way of looking how we can fulfill human needs
and cp-living with a natural world as humans and
societies.
Overlapping circles model:
You have a sweet spot in the middle where you’ve all the
aspects of the three domains; it’s economic, social and
environmentally healthy.
- The human system is depending on the
ecosystem, but the ecosystem is also shaping the
human system.
- The economy is depending on the biosphere air,
resources, stable climate in which we can operate.
- Social-economic system is dependent on society,
healthy workers, democratie, education…
- So all 4 are co-creating and depending all on
another!
Insd 1
,Sustainability 2.0: Sustainability refers to sustaining the underlying pattern of health,
resilience, and adaptability that maintain this planet in a condition where life as a whole can
flourish and that for this to be possible in the long term, the way modern societies organized
shouldn’t be sustained, but rather re-designed using a regenerative perspective
à So you can have a healthy system functioning also overtime
à The definition of sustainability 2.0, is looking how can make it regenerative and thrive in a
good way and not just doing less harm, or continuing what we’re doing but just greener (like
sustainability 1.0 was doing)
à We don’t want just in the long term to change a bit the current system, we really want to
transform, and redesign based on a regenerative practice! So, it can start flourishing again!
Three nested model (embedded model):
Environment, society and economy are clearly linked in a nested model. You can see that
‘economy’ is a smaller set than the 2 other ones, because our economic transactions, to have
a good well-being are just a small part of the system! We’ve way more social transactions
outside the economy, like visiting your family/friends, enjoying cultural activities…
à Society is way more than economy, and both are
dependent on a healthy environment to have food, clean
air
à This is a more social ecological embedded view on the
economy, that ecological economists are taking as a
starting point to start doing the analysis; an economy
being service of the society & the environment = THIS IS
THE VISION WE WILL ADOPT IN THIS CLASS!
1.2 What is sustainable system?
Sustainability requires change:
- To be sustained: The living world we want to sustain
- To be changed: Things that need to change, in order for environment to be held
sustainable and also balancing feedback between people, economy and society… All
these human maids; how we perceive life, structures we developed, our current
economic system that is driving around economic growth… All these aspects need to
be changed, to move towards a sustainable economy!
Insd 2
,Sustainable & Equitable allocation of resources?:
The economy is taking planetary resources and allocating it in a inefficient way towards
human needs, and human well-beings that are being of service of certain communities. It
could be that it is ecological efficient, but it could also be that it’s inefficiently allocated, f.e.
people having their private swimming pools, jets…
So there’s a huge difference between the resources that we have and how they’re going to
be allocated in societies!
Planetary resources: Natuurlijke hulpbronnen, bv.water
Social resources: Niet-materiële menselijke en maatschappelijke elementen, bv. onderwijs
Sustainability economics: Economics is the study of scarcity and its implications for
the use of resources, production of goods and services, growth of production and welfare
over time.
à This is a definition that focuses on scare resources to meet various competing ends. These
resources could be: social human, physical and natural.
Other view to look at it: They’re certain human needs and several ways to fulfill them. So
maybe now, in our consumer society we’re not always using the right resources in a good
way to be able to fulfill these needs!
For example: We think we want to buy something fancy, but we actually want is connecting
with others, so maybe there’re something else we actually need, instead of the product that
advertisers try to sell to us!
Insd 3
,Profit as a means (= financiële middelen) or as an end?
By selling products, they want to make products for their shareholders, but there’s a
difference between what people need and be good for the planet and pure profit making
maximalization.
So there’re different means, that translate into different ends. And profit or economic
growth are maybe not the right goals to pursue… We should focus on something else!
Value management: How to balance the needs and set priorities?
There’re different values to be managed in our economy. (100% EXAM QUESTION)
Insd 4
,Planet boundaries: This image represents the Planetary Boundaries Framework, developed
by the Stockholm Resilience Centre, which identifies nine key environmental systems that
regulate Earth's stability. In this image we’re crossing 4 boundaries. (YOU DON’T HAVE TO
KNOW THIS IN DETAIL!)
The Colors
🟢 Green = Safe
🟡 Yellow = Some risk
🟠 Orange = High risk (we have gone too far)
The 9 Planetary Boundaries:
1. Biodiversity Loss – Too many species are
disappearing. This weakens nature.
2. Climate Change – Too much CO₂ is warming
the planet, causing extreme weather.
3. Deforestation – Cutting down too many trees hurts ecosystems and the climate.
4. Freshwater Use – Using too much water can cause shortages.
5. Fertilizer Overuse – Too much nitrogen & phosphorus pollutes water and kills fish.
6. Ocean Acidification – Too much CO₂ makes the ocean acidic, harming marine life.
7. Ozone Layer Damage – Harmful chemicals (like old CFCs) can let in dangerous UV
rays
8. Air Pollution – Tiny particles in the air cause disease and affect the climate.
9. Toxic Chemicals & Plastics – New chemicals and plastic waste (= plastic products)
pollute the environment.
System thinking: The iceberg model
- Events: What we can see
- Hidden: What we can’t see, but this is what shaped these ‘events’
If you look at complex system, you don’t already see the bigger picture; and this is illustrated
by the iceberg model. So, when you look at what is happening in the economies and
societies in the living world, actually only the ‘events’ are visible, so only the top of the
iceberg. There’s much more going on underneath the surface, but it’s not always visible and
more difficult to
discover.
Insd 5
,Different beliefsystems/mental models:
- Homo economics, free market…
- Anthropocentric: This view leads to the
current problematic situation that we’re
having. Human as central in the
economy/biosphere.
- Biocentric: This view focuses more on how
we’re dependent on the living world. Human
as part of the living world.
This image shows the Iceberg Model, which helps us understand why things happen. It tells
us that what we see (the "tip of the iceberg") is only a small part of the whole story.
1 Events (What we see) → "What's happening?"
• This is what we notice right away, like a heatwave, pollution, or deforestation.
• Example: "Oh no! There's a drought!"
2 Patterns & Trends (What happens over time) → "What's been happening?"
• This is when the same things keep happening again and again.
• Example: "Every summer, there are more and more droughts."
3 Underlying Structures (The causes behind the patterns) → "What's influencing this?"
• These are laws, policies, or economic systems that create the patterns.
• Example: "Farmers are using too much water, and governments aren’t managing
resources well."
4 Mental Models (The deep beliefs that shape everything) → "What beliefs cause this?"
• These are cultural ideas, traditions, or ways of thinking that make the system work
like this.
• Example: "People believe water is unlimited, so they don’t save it."
à If we only focus on events, we’ll keep fixing symptoms instead of solving the real
problem.
To create a sustainable system, we need to change the deeper structures and beliefs!
Insd 6
,Transition 1.0: Making the current system work better, without fundamentally changing
the system itself!
- Events: “Yellow jackets” = ‘Gilets jaunes” à People in France are protesting against
the rising fuel prices, that people can’t afford, while they need their car to go to
work.
- Patterens & trends: Incremental steps = Small steps
- ….
Those incremental improvements aren’t fundamentally changing the underlying economic
system; they are just sustaining the current system;
- Same mental models
- Money is still a priority
- Not touching market structures
Transition 2.0: From incremental change to ‘generative’ system
- Events: Purpose investment à They’ve a different mission, not just to make profit,
but really being of service of the people & planet
Insd 7
, - Mental models: Reconnecting worldview à Being connected to each other & the
mature
- Current system: Antropocentric (mental model)
- System shift: Biocentric (mental model)
Transition theory: Overtime systems change, you’ve 3 levels:
- Landscape: Landscape pressure, climate change, biodiversity loss… These have an
influence on our behaviour ( how we eat, travel etc) and can create new
opportunities for niches to build a more established ecosystem.
- Niches: Initiatives that come from the people (f.e. electric cars, organic farming etc),
some fail and some work.
- Ecosystem: These initiatives can lead to a
different ecosystem which evolve overtime
and become more established, and can lead
to a new functioning businesses.
Insd 8
, Transition 1.0: Incremental changes, which is a good thing to do, but isn’t going to
change fundamentally our current system. One system takes over (= ascendency) and
everyone is following the same path (= convergence)
You’ve big corporations becoming dominant like in the fuel industry and they’re just
continuing doing what they’re doing and protecting their own interests, but this
could lead to an adverse effect.
The system is stuck/locked-in in an unsustainable state, where making changes is
difficult.
Transition 2.0: Supporting alternative solutions (= niches) that are resilient, and
different from the mainstream. + Many ideas are tested, it’s diverse (= divergence)
What is a sustainable system?
1) Conventional: Causes a lot of harm to people and the environment
2) Green: “Less harm”, but still not fully sustainable
3) Sustainable: Respects both social and ecological limits
4) Restorative: Actively repairs damage done in the past
5) Regenerative: Creates positive impact and helps ecosystems thrive
Insd 9
, How do systems shift?
- Niches (micro-level): Innocation ideas
- Ecosystems (meso-level): These innovations spread and form new ecosytems and
networks
- Institutions (macro-level): Laws, education etc. change to support the NEW
MAINSTREAM
à Sustainability transitions aren’t lineair, they need cooperation at all levels of society.
Ego: Antropocentric à Focused on self-interest, consumption and competition
Eco: Biocentric à Focused on our connection to nature and others (= intraconnection)
SEVA: Spiritual principle à Helping others because it’s the right thing to do, without wanting
to receive something from them in return
Sustainability economics: Study of economic systems that support human well-being
and ecological health
Insd 10
