Book Review: Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist by Kate Raworth

As featured in Edition 39, available here.

BY SUSBIN SHRESTHA (1st year Masters - International Political Economy - Aldershot, UK)

Despite the title, “Doughnut Economics” is not just about economics and Kate Raworth is more than an economist. The book challenges the highly insular nature of the discipline by adopting an interdisciplinary approach guided overwhelmingly by planetary science. What results is a strand of economic thought that overturns several of the most sacrosanct assumptions underpinning the standard account of economics.

In its current state, the world economy is predicated on principles of infinite growth. Instead, Raworth argues, we must envision an economy that meets the social needs of people whilst also operating firmly within earth’s planetary boundaries. When modelled, what this ends up looking like is a doughnut. Supplementing this further, the economy must be embedded within society and nature rather than the closed-loop the current economic paradigm supposes; taking from the work of feminist economists as well as political economists such as Karl Polanyi. Likewise, changes must translate from the macro to the micro. Homo Economicus must reflect humanity's social and interdependent nature if it is to survive the Anthropocene.

Although the familiar curves of supply and demand are relegated to introductory economics classes, economic modelling must be built upon a more dynamic system if it is to deal with the complex systems over which it presides. Contemporary economics finds the answer to inequality in economic growth, but as the work of Thomas Piketty has already shown, this is not enough. The economy must be distributive by design, as must it be regenerative - green growth or traditional concepts of sustainable development will not save the planet.

In sum, economists and politicians alike must shift from ‘growth addicted’ to ‘growth agnostic’. For too long societal progress has been linked to economic growth. Only through decoupling the two can the world hope for an economically and ecologically viable future.

Image: Chelsea Green Publishing / Doughnut Economics