Sustainable economics conference

Just come back from the sustainable economics conference – it is still going for a few hours, but it is just on politics now and I’m not a politician 😉

It was Green party hosted, so I have the impression that many of the ideas (especially when mentioned by their own MPs) were their ideas.

Now, there are a number of final value judgments I disagreed with, I felt the idea of crisis was overplayed, and the early characterisation of “neo-classical economics” was in many ways wrong and attacked economists too much – also they were too willing to blame the GFC (Great Financial Crisis) on any pet theory that existed.  BUT, these are all minor quibbles, and overall I was impressed with the discussion.

My main quibble is that sustainability was treated as the primary goal – this is still a “throughput” towards the main goal which is the welfare of the appropriate group on earth.  Assuming sustainability is the sole goal is equivalent to an extreme assumption about the makeup of the environment and/or the welfare function.  However, I will let this slide as I got to note it here 😉 .

The Green MPs spoke well, and showed a willingness to discuss and think about trade-offs, I was impressed with them.  There still seemed to be a feeling of “command and control” among some elements of the discussion, and there were specific issues I disagreed with, but overall I felt that the MPs were actually some of the best speakers – David and Russel spoke very well, and at least in terms of the framework they used I largely agreed with them.

The afternoon economic discussion was civil and sensible – and the policy conclusions that the speakers came too made sense.  So much so that if the Green party actually discussed their framework with Labour, National, and ACT (namely thinking about natural capital and accounting for externalities) they would find a large amount of agreement.

Now, this is the thing – the disagreement between parties is about the magnitudes, the quantitative figures, not the qualitative idea of allocation.

Given how much abuse the descriptive economic method took during the morning, I was surprised that the actual discussion on economic policy turned around and used it – surprised in a pleasant way.

Good on the Green party for getting this together – if you focused on discussing these issues and committing to studies that would try to work out the value of any policies objectively, I would vote for you.

If I continue to hear about capital controls and changes to monetary policy (none of which were raised at this conference thank goodness) then I will not vote for you.

That is just me though.

  • Tribeless

    Do you think it possible to separate politics from philosophy from economic policy?

    You’ve said constantly that you don’t like central planning – and I took that to mean Statism – yet you leave a lot of room open here for voting Greens? How do you reconcile that contradiction?

  • @Tribeless

    “Do you think it possible to separate politics from philosophy from economic policy?”

    No. As a policy involves a conclusion, and you can’t reach a conclusion without making value judgments.

    “yet you leave a lot of room open here for voting Greens?”

    I think the conditions I place on voting Greens here are still quite high given the “organisational slight” they put on policy – but if they turn and meet these conditions, then I would be keen to.

    At the moment, all the parties appear to have quite a central planning bent – as they all want to make it sound like they can make things magically happen. This disappoints me. At the present time I wouldn’t vote for any of them.

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  • Raf

    Matt,

    I think the focus of the day was a sustainable economy. That’s probably easier to define than sustainability. I think the Greens have struggled with their underlying message for years, namely that we should internalize extermnalities. Sure there is a philosophical “green” view which focuses on living within our bioshperical limits but from a policy perspective they are talking the right language at the moment.

    If they can carry that on then they will pull in more votes for sure.

    I was hoping for more on monetary policy but that didn’t get too much airing. I know we have differing views there so I won’t bang on about it here.

    I’m looking forward to more debate around these issues.

  • @Raf

    “I think the focus of the day was a sustainable economy. That’s probably easier to define than sustainability”

    It might be easier – but given the inability to form judgments regarding future technology, or the incentives to help drive technological change, it still seems like a difficult issue to define substantively. And even if we could, it is hard to know whether that defined outcome is even the ex-ante optimal outcome.

    “From a policy perspective they are talking the right language at the moment”

    I agree, which is why I was relatively supportive in this post.

    “I was hoping for more on monetary policy but that didn’t get too much airing. I know we have differing views there so I won’t bang on about it here.”

    I was glad that we didn’t hear more on monetary policy per see – as I felt that it wasn’t really an objective area for debate following the straw man (and wrong) version of economics that had been promoted earlier.

    I also don’t see how cyclical policy (monetary policy) is relevant to a structural issue (sustainability) – fiscal policy is the way to go in these cases.

    And it is good our views differ – it tends to be the things everyone agrees upon where policy errors are the greatest 😉

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