Economics. Environment. Senses and Contradictions
In the year 1951, on August 13, President Getúlio Vargas sanctioned Law 1,411, creating the profession of the Economist and since then on this date we also celebrate the Economist’s Day. The classical definition attributed to economic science describes as its object of study the alternative uses of scarce resources, observing historical, institutional, social, collective and individual phenomena and processes, concomitantly or not, in order to help in decisions process.
However, the theoretical foundations that support the economic studies date back much to that date, originating in a systematized form in the 18th century when Adam Smith, considered the father of economics, published his seminal work An Inquiry into the Nature and Causes of the Wealth of Nations, popularly known as The Wealth of Nations. Smith’s work has given rise to innumerable discussions, mainly centered on elements such as income, social classes, production relations and distributive justice, among others, producing hypotheses, theories, proposals and ideologies that are different and in many cases divergent from one to another because of differentiated perception of realities and/or themes.
Among the most diverse conceptual and theoretical elements presented by Smith, we highlight here his distinction between use-value and exchange-value explained from the comparison between water and diamond, considering in both, on the one hand utility and on the other hand market value. The analogy presented by Smith had already been used by Plato in 380 (BC), in the Euthydemos dialogue, when he described water as the best of all things although the non-rarity then observed made it also the cheapest commodity in the market.
Paradoxically, even though water has been an element of observation in both situations, natural resources have been treated for many centuries only as land in the most diverse economic analyzes, thus creating a perception that the environment could be delimited as a subsystem of the economic system. Such pragmatic, misrepresented and minimalist view has given rise to proposals for analyzing environmental problems as a simple allocation issues resulting from the inexistence of a pricing mechanism, thus reinforcing the market’s character as a center of equilibrium through supply and demand mechanisms.
It is observed that the original sense was blurred over the years acquiring airs of absurd when already in the first half of the 20th century rivers were characterized as a convenient place for disposal of waste, and the dilution of effluents was then seen as a legitimate use of rivers. As a result of this unregulated use and total non-observance of the limits imposed by nature, we currently face the qualitative and / or quantitative scarcity of several natural resources. In this context, the studies related to the Environmental Economy that are consolidated in the academies are observed as innovative and challenging due to the presented theme and the multidisciplinary complexity inherent in them.
Thus, bringing back the environment theme in economic discussions implies the redefinition of conventional approaches, methods and theories, challenging from a multidisciplinary perspective of conventions theoretically established. More than that, it is to rethink and broaden the universe of economic analysis in order to follow as economists the demands presented by a society in constant transformation.( access to the text)
Telma Teixeira. RHIOS August 2017 (translation from portuguese by Leila FONTOURA)
Read other texts by Telma Teixeira