Peter Söderbaum: How Can the Language of Economics be Made Politically more Relevant in Relation to Sustainable Development? (2)

Actors connected with the Rosa Luxemburg Foundation are concerned about present unsustainable trends. RLF actors make the judgment that something new need to happen. Business as usual (BAU) or “ecological modernization” is not enough. We also have to consider radical changes in thinking and institutional arrangements.

Our societies are specialized in a number of ways. University research and education is perceived as separate from politics. Positivism (among theories of science) has made this separation legitimate. The language of science, for example the language of neoclassical economics is developing in its own way with insufficient attention and feed-back from politics and the languages of politicians. I think the economics language need to be reconsidered to become politically more relevant.

On the mixed roles of individuals and organizations

There is a tendency to look upon individuals (organizations) in either-or terms as belonging to one category. You are either a social scientist and economist or a politician. I think that those of us connected with universities and with science as the main identity are at the same time politicians; “values are always with us” as argued by Gunnar Myrdal (1978). And those who are politicians as their main identity similarly learn from science and influence the conceptual framework and language of science (economics).

Civil Society Organizations like Rosa Luxemburg Foundation may have a main role outside science and politics but are at the same time part of science as well as politics. I think that we are all actors in a political economics sense with connected responsibilities. Economists and other social scientists can no longer easily shift responsibility on to scientists or other actor categories.

While the language of mainstream economists (as scientists) as well as the language and roles of politicians and CSOs need to be reconsidered, some part of existing identities of the three categories should remain and perhaps be further developed. Economists as scientists should continue to critically examine each other in journals and elsewhere but should also learn from and critically examine actors in other categories and society at large. This is sometimes referred to as a “third task” (in addition to research and education) of universities.

Economics – from monopoly to democracy

Mainstream neoclassical economics has become isolated and protected from the outside world partly as a result of its reliance on positivism and its one paradigm idea (the paradigm often referred to as ‘standard economics’). To fulfill their double role of learning from and examining politics in various fields such as sustainability, economists should accept the existence of more languages (conceptual frameworks) than one.

If Corporate Social Responsibility (CSR), “fair trade” and various certification schemes have become issues in the larger society and the “real world” then economists cannot go on with a conceptual framework and language which is completely insensitive to these developments.

It is the monopoly position of neoclassical economics in education and research which is the main problem. Neoclassical assumptions about human beings as rational consumers and ‘firms’ as rational profit-maximizing entities can be accepted among other models of human beings, organizations etc. in the case that economics has become pluralistic. Democracy has to enter into economics. This has not yet happened at university departments of economics but a power game is going on as exemplified with a newspaper article in Upsala Nya Tidning  (Söderbaum 2013a).

The TEEB-study as a case

As long as the neoclassical close to monopoly position continues, there is no “fair competition” in the world of ideas. The good arguments do not matter it appears. A case in point is the so called TEEB-study The Economics of Ecosystems and Biodiversity (Kumar ed. 2010). A number of ecological economists have since the start of the International Society for Ecological Economics (ISEE) been critical to the use of CBA in relation to environmental issues. No agreement can be expected among politicians and citizens about one single correct way of valuing environmental impacts. But actors connected with the United Nations Environmental Programme (UNEP) have cooperated with neoclassical environmental economists (and some ecological economists, I must add) under the banner of “mainstreaming” the economics of biodiversity. The attraction of simple monetary valuation in CBA terms is gaining ground again in this area of policy and politics. The authors of the TEEB-study show that they know about some criticisms of CBA but at the end of their deliberations nevertheless recommend CBA. One person and consultant, Pavan Sukhdev, appears to have been very influential in these attempts to regain control by neoclassical environmental economists and other BAU-actors.

Hopefully this achievement will not be the end of the game. In the November issue of Ecological Economics there are two so called Commentaries criticizing the TEEB-study (Söderbaum 2013b, Baveye et al. 2013). In a RLF-context Ulrich Brand (2012) has similarly criticized the simplistic nature of UNEP’s arguments in favor of a “Green Economy”.

Elinor Ostrom’s contribution to the language of economics

The language of economics, even the language of neoclassical economics, need to be developed to make us understand what happen in the “real world” and also for governance and decision-making purposes. Our thinking is limited by our language although language can be socially constructed for specific purposes to some extent.

I think the terminology “common pool resources” opened the door for some new thinking. Also the title of the Brundtland report Our Common Future has been influential. In addition Herman Daly’s book For the Common Good can also be mentioned although one may get the feeling that for him ‘the common good’ is one thing. Normally, in a democratic society there are many ideas about what is good for society.

Elin Ostrom’s contribution to economics does not end with the mentioned term. She suggested that other social sciences have something to offer in terms of conceptual framework and language. The word ‘common’ points to interests that people share and to the need for cooperation. Individuals and organizations always relate to a ‘public sphere’ suggesting that the neoclassical distinction between ‘private goods’ and ‘public goods’ becomes questionable. There is always a public sphere even in relation to transactions with so called “private” goods and environmental policy and politics need to encourage people to broaden their views and concerns.

For this purpose I think that we need to consider individuals and organizations as political actors and also that we need to refer to their  ideological orientations or missions. Economists should borrow the word ‘ideology’ from the political dialogue and sustainability politics should partly be a matter of further broadening ideological orientations.

And to bring things together: If we take the existence of a public sphere seriously then the idea of precise monetary evaluation in CBA-terms becomes absurd.



Baveye, Philippe C. Jacques Baveye, John Gowdy, 2013. Commentary: Monetary valuation of ecosystem services: It matters to get the time line right, Ecological Economics, Vol. 95 (November), pp. 231-235.

Brand, Ulrich, 2012. Beautiful Green World. On the Myths of a Green Economy. Rosa Luxemburg Foundation, Berlin.

Kumar, Pushpam, editor, 2010. The Economics of Ecosystems and Biodiversity. Ecological Economics Foundations. Earthscan, London.

Myrdal, Gunnar, 1978. Institutional Economics, Journal of Economic Issues, Vol. 12, No.4 (December) pp. 771-783.

Söderbaum, Peter, 2013a. Demokratisera nationalekonomin, Upsala Nya Tidning, Debatt, 22 Oktober, p.5. Uppsala.

Söderbaum, Peter, 2013b. Commentary:  Ecological Economics in relation to democracy, ideology and politics, Ecological Economics, Vol. 95 (November), pp. 221-225.


Leave a Reply

Your email address will not be published. Required fields are marked *