thermoeconomics
{{Short description|Heterodox economic theory}}
{{About|biophysical economics|the study of the dynamics of natural resources using economic models|Bioeconomics (fisheries)}}
{{Ecological economics|Related topics}}{{Technical|date=May 2022}}
Thermoeconomics, also referred to as Bioeconomics or Biophysical Economics, is a school of heterodox economics that applies the laws of statistical mechanics to economic theory.{{cite book | last = Sieniutycz | first = Stanislaw |author2=Salamon, Peter | title = Finite-Time Thermodynamics and Thermoeconomics | publisher = Taylor & Francis | year = 1990 | isbn = 0-8448-1668-X}} Thermoeconomics is considered the statistical physics of economic value{{cite book | last = Chen | first = Jing | title = The Physical Foundation of Economics - an Analytical Thermodynamic Theory | publisher = World Scientific | year = 2005 | isbn = 981-256-323-7}} and is one subfield of econophysics, extenuating to Ecological Economics.
It is the study of the ways and means by which human societies procure and use energy and other biological and physical resources to produce, distribute, consume and exchange goods and services, while generating various types of waste and environmental impacts. Biophysical economics builds on both social sciences and natural sciences to overcome some of the most fundamental limitations and blind spots of conventional economics. It makes it possible to understand some key requirements and framework conditions for economic growth, as well as related constraints and boundaries.{{Cite web |date=2017-01-23 |title=What is biophysical economics? |url=https://biophyseco.org/biophysical-economics/what-is-biophysical-economics/ |access-date=2022-09-28 |website=BiophysEco |language=en}}
Thermodynamics
"Rien ne se perd, rien ne se crée, tout se transforme"Thermoeconomists maintain that human economic systems can be modeled as thermodynamic systems. Thermoeconomists argue that economic systems always involve matter, energy, entropy, and information.Baumgarter, Stefan. (2004). [http://www.eco.uni-heidelberg.de/ng-oeoe/research/papers/Baumgaertner%202004%20ModEE.pdf Thermodynamic Models], Modeling in Ecological Economics (Ch. 18) {{webarchive|url=https://web.archive.org/web/20090325075446/http://www.eco.uni-heidelberg.de/ng-oeoe/research/papers/Baumgaertner%202004%20ModEE.pdf |date=2009-03-25 }}{{Cite book|url=|title= Thermodynamics of Complex Systems: Principles and applications. |last= Pokrovskii |first=Vladimir|language=English | publisher= IOP Publishing, Bristol, UK.|year=2020|isbn=|pages=|bibcode= 2020tcsp.book.....P }} Then, based on this premise, theoretical economic analogs of the first and second laws of thermodynamics are developed.{{cite book | last = Burley | first = Peter |author2=Foster, John | title = Economics and Thermodynamics – New Perspectives on Economic Analysis | publisher = Kluwer Academic Publishers | year = 1994 | isbn = 0-7923-9446-1}} The global economy is viewed as an open system."Nothing is lost, nothing is created, everything is transformed."
-Antoine Lavoisier, one of the fathers of chemistry
Moreover, many economic activities result in the formation of structures. Thermoeconomics applies the statistical mechanics of non-equilibrium thermodynamics to model these activities. In thermodynamic terminology, human economic activity may be described as a dissipative system, which flourishes by consuming free energy in transformations and exchange of resources, goods, and services.{{cite journal
| last = Raine | first = Alan |author2=Foster, John |author3=Potts, Jason
| title = The new entropy law and the economic process
| journal = Ecological Complexity | volume = 3 | issue = 4 | pages = 354–360 | date = 2006
| doi = 10.1016/j.ecocom.2007.02.009
| bibcode = 2006EcoCm...3..354R }}{{cite journal
| last1 = Annila, A. and Salthe, S.
| title = Economies evolve by energy dispersal
| first2 = Stanley
| journal = Entropy | volume = 11
| last2 = Salthe | pages = 606–633 | year = 2009
| doi = 10.3390/e11040606
| first1 = Arto | issue=4| bibcode = 2009Entrp..11..606A| doi-access = free}}
Energy Return on Investment
Thermoeconomics is based on the proposition that the role of energy in biological evolution should be defined and understood not through the second law of thermodynamics but in terms of such economic criteria as productivity, efficiency, and especially the costs and benefits (or profitability) of the various mechanisms for capturing and utilizing available energy to build biomass and do work.Peter A. Corning 1*, Stephen J. Kline. (2000). [https://archive.today/20120630072317/http://www3.interscience.wiley.com/cgi-bin/abstract/71007254/ABSTRACT Thermodynamics, information and life revisited, Part II: Thermoeconomics and Control information ] Systems Research and Behavioral Science, Apr. 07, Volume 15, Issue 6, Pages 453 – 482Corning, P. (2002). "[http://www.complexsystems.org/abstracts/thermoec.html Thermoeconomics – Beyond the Second Law] {{webarchive|url=https://web.archive.org/web/20080922072349/http://www.complexsystems.org/abstracts/thermoec.html |date=2008-09-22 }}"{{dubious|date=June 2018}}
Peak oil
= Political Implications =
"[T]he escalation of social protest and political instability around the world is causally related to the unstoppable thermodynamics of global hydrocarbon energy decline and its interconnected environmental and economic consequences."{{Cite book |last=Ahmed |first=Nafeez Mosaddeq |url=https://www.worldcat.org/oclc/965142394 |title=Failing states, collapsing systems : biophysical triggers of political violence |date=2017 |publisher=Springer |isbn=978-3-319-47816-6 |location=Cham, Switzerland |oclc=965142394}}
= Energy Backed Credit =
Under this analysis, a reduction of GDP in advanced economies is now likely:
- when we can no longer access consumption via adding credit, and
- with a shift towards lower quality and more costly energy and resources.
The 20th century experienced increasing energy quality and decreasing energy prices. The 21st century will be a story of decreasing energy quality and increasing energy cost.{{Cite journal |last=Hagens |first=N. J. |date=2020-03-01 |title=Economics for the future – Beyond the superorganism |journal=Ecological Economics |language=en |volume=169 |pages=106520 |doi=10.1016/j.ecolecon.2019.106520 |s2cid=212882790 |issn=0921-8009|doi-access=free |bibcode=2020EcoEc.16906520H }}
See also
References
{{reflist}}
Further reading
- {{cite book | last = Georgescu-Roegen | first = Nicholas | title = The Entropy Law and the Economic Process | url = https://archive.org/details/entropylawe00nich | url-access = registration | publisher = Harvard University Press | location = Cambridge, Massachusetts | year = 1971 | isbn = 978-1583486009}}
- {{cite book | last = Pokrovskii | first = Vladimir | title = Econodynamics. The Theory of Social Production | url = https://www.springer.com/physics/complexity/book/978-94-007-2095-4 | publisher = Springer | location = Berlin | year = 2011 | isbn = 978-1-4419-9364-9| series = New Economic Windows }}
- {{cite book | last = Kümmel | first = Reiner | title = The Second Law of Economics: Energy, Entropy, and the Origins of Wealth | url = https://www.springer.com/physics/complexity/book/978-1-4419-9364-9 | publisher = Springer | location = Berlin | year = 2011 | isbn = 978-94-007-2095-4| series = The Frontiers Collection }}
- Chen, Jing (2015). [https://www.springer.com/us/book/9781493934645 The Unity of Science and Economics: A New Foundation of Economic Theory]: Springer.
- Charles A.S. Hall, Kent Klitgaard (2018). [https://link.springer.com/book/10.1007/978-3-319-66219-0 Energy and the Wealth of Nations: An Introduction to Biophysical Economics]: Springer. {{ISBN|978-3-319-66217-6}}
- Jean-Marc Jancovici, Christopher Blain (2020). [https://www.europecomics.com/world-without-end-a-necessary-graphic-novel/ World Without End]. Europe Comics
- N.J. Hagens (2019). [https://www.sciencedirect.com/science/article/pii/S0921800919310067 Economics for the future – Beyond the superorganism]. Science Direct.
- Nafeez Ahmed (2017). [https://www.academia.edu/34816514/Failing_States_Collapsing_Systems_BioPhysical_Triggers_of_Political_Violence_SPRINGER_BRIEFS_IN_ENERGY_ Failing States, Collapsing Systems: BioPhysical Triggers of Political Violence]. Springer Briefs in Energy
- Smil, Vaclav (2018). [https://mitpress.mit.edu/9780262536165/energy-and-civilization/ Energy and Civilization: A History]. MIT Press
External links
- Yuri Yegorov, article Econo-physics: A Perspective of Matching Two Sciences, Evol. Inst. Econ. Rev. 4(1): 143–170 (2007)
- Borisas Cimbleris (1998): [http://ecen.com/eee9/ecoterme.htm Economy and Thermodynamics]
- Schwartzman, David. (2007). "[http://www.redandgreen.org/Documents/Limits%20to%20entropy%20final.pdf The Limits to Entropy: the Continuing Misuse of Thermodynamics in Environmental and Marxist theory]", In Press, Science & Society.
- Saslow, Wayne M. (1999). "[http://www.df.uba.ar/users/giribet/f4/economic.pdf An Economic Analogy to Thermodynamics]" American Association of Physics Teachers.
- [https://bpeinstitute.org/ Biophysical Economics Institute]
{{Schools of economic thought}}