Doughnut economics

Definition

Doughnut economics is a conceptual framework that proposes a new model for economic development, aiming to balance essential human needs and planetary boundaries. The term visualizes a 'doughnut' shape where the inner circle represents the social foundation of human well-being, and the outer circle represents the ecological ceiling that must not be exceeded to ensure a sustainable future. This approach seeks to promote a regenerative and distributive economy that prioritizes both equity and sustainability.

5 Must Know Facts For Your Next Test

1. Doughnut economics was popularized by economist Kate Raworth in her book titled 'Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist,' published in 2017.
2. The model emphasizes that meeting the needs of all people within the means of the planet is crucial for achieving a just and sustainable economy.
3. It encourages a shift away from traditional GDP-focused growth metrics, advocating for measures that account for social and environmental health.
4. Doughnut economics incorporates ideas from various fields, including ecological economics, systems thinking, and social justice, creating an integrated perspective on economic challenges.
5. The framework has gained traction among policymakers and activists as an alternative vision for addressing global challenges such as climate change and inequality.

Review Questions

• How does doughnut economics redefine traditional economic success?
  • Doughnut economics redefines traditional economic success by moving away from solely measuring growth through GDP. Instead, it advocates for an approach that ensures social well-being while respecting ecological limits. This means prioritizing indicators that reflect quality of life and sustainability, rather than just financial expansion. By placing importance on both human needs and planetary health, this framework reshapes how we assess the health of economies.
• Discuss how doughnut economics can address issues related to inequality and environmental degradation.
  • Doughnut economics addresses inequality by emphasizing that every individual deserves to meet their basic needs within a fair distribution of resources. It identifies social foundations that must be met, such as food, housing, and education, while also recognizing ecological ceilings to prevent environmental degradation. This holistic perspective encourages policies that promote equitable access to resources and sustainable practices that protect the environment, aiming to create an inclusive economy that works for all.
• Evaluate the potential impact of implementing doughnut economics on global economic policies and practices.
  • Implementing doughnut economics could significantly reshape global economic policies and practices by prioritizing sustainability and equity over mere growth. This shift could lead to transformative changes in industries, encouraging innovation in green technologies and promoting regenerative practices across various sectors. By adopting this framework, nations may collaborate more effectively on global challenges like climate change and resource depletion, creating a more resilient global economy that aligns with both social justice and environmental integrity.

Related terms

Sustainable Development: A development approach that aims to meet the needs of the present without compromising the ability of future generations to meet their own needs, balancing economic growth, social equity, and environmental protection.

Regenerative Economy: An economic model that focuses on restoring and regenerating natural systems while promoting social equity and community well-being, moving beyond sustainability towards actively improving ecological health.

Social Foundation: The minimum standards of living conditions and quality of life that should be met for all individuals, encompassing aspects such as health, education, and access to resources.