energy & money integrating social metabolism into economic analysis blair fix canadian society...
TRANSCRIPT
Energy & Money
Integrating Social Metabolism into Economic Analysis
Blair Fix
Canadian Society for Ecological EconomicsToronto
November 2, 2013
Real GDP:
A measure of our ignorance?
A Quantity Measure of Output
GDP Nominal = Quantity×Price
= GDP Real× GDP Deflator
GDP Real=GDP Nominal
GDP Deflator
Quantity of What?
Quantification Requires Units
3 apples + 3 oranges = ?
The Seven SI Base Units
Defining 1 second:
The duration of 9,192,631,770 periods of the radiation corresponding to the transition
between the two hyperfine levels of the ground state of the cesium 133 atom.
The Choice of Unity Affects Aggregate Quantity
Apple : Orange
Mass (kg) 1 : 2
Energy (J) 3 : 4
Price ($) 5 : 7
The fundamental problem with using price as a unit...
Relative prices change all the time, meaning our unit ($) has no single definition!
A Historical Example
Measuring Changes in Quality?
Hedonic Quality Adjustment
“The practice of decomposing an item into its constituent characteristics, obtaining estimates of the value of the
utility derived from each characteristic, and using those value estimates to adjust prices when the quality of a good
changes.”
US Bureau of Labour Statistics
A Completely Different Approach to Output
Dissipative Structures
Society as a Dissipative Structure
Social Metabolism
Useful Work:
A physically meaningful quantity measure of output.
A Pecuniary Feedback
GDP Nominal
U Price
=Dissipative Pressure
Most Types of Useful Work Have No Price
1. Mechanical Drive
2. Heat (Low, Mid, High)
3. Light
4. Muscle Work
5. Electricity
The Price of Electricity as a Proxy for the Price of Useful Work
KWH Deflated GDP
Dissipative Pressure = GDP Nominal /U Price
= GDP Nominal /PKWH
Dissipative Pressure = GDP Nominal /U Price
GDP KWH = GDP Nominal /PKWH
Japan
United Kingdom
United States
Conclusions
Rethinking Labour Productivity
