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Index

Published online by Cambridge University Press:  19 October 2023

Dieter Helm
Dieter Helm
Affiliation:
University of Oxford

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Type
Chapter
Information
Legacy
How to Build the Sustainable Economy
 , pp. 241 - 249
Publisher: Cambridge University Press
Print publication year: 2023
Creative Commons
Creative Common License - CCCreative Common License - BYCreative Common License - NCCreative Common License - ND
This content is Open Access and distributed under the terms of the Creative Commons Attribution licence CC-BY-NC-ND 4.0 https://creativecommons.org/cclicenses/

Index

accounts, for a sustainable economy, see sustainable accounting
agriculture
marginal costs associated with, 120
physical infrastructure, 86–87
polluter-pays principle, 104–105
assets
asset valuation, 87–89
balance sheet, 85–87
capital maintenance, 74–80
national accounts, 83–85
remedial and enhancement investments, 80–83
system regulation model, 188–190
universal service obligations (USOs), 156–160
what should be passed down, 207–209
assets-in-perpetuity, 6–7, 74, 87
asymmetric risks, 44–46
auctions, 185–188
Austrian school of economics
economics and entrepreneurs, 46–48
pollution taxes, 105–106
average costs, 117, see also marginal costs
balance of payments, 90–91, 140
the balance sheet, 73–74, see also sustainable accounting
citizens’ debt and liabilities, 173–175
system regulation model, 194–196
what should be passed down, 207–209
Barro, Robert, 146–147
basic income
and national dividends, 169–172
universal provision, 162–166
Becker, Gary, 67–68
Bentham, Jeremy, 23
Beveridge, William, 163–164
biodiversity
capital maintenance, 76, 81–82
contemporary context, 1–2
forecasting and uncertainty, 35–39
global agreements, 109–111
interventions, 57–58
limited realistic impartiality, 27
mass extinctions, 34–35
biomass as renewable energy, 112
black swan events, 40–41
Brundtland Report, 31
capability approach, 104, 163–164
capital, see also natural capital
human, 63–69, 83, 208
natural vs. other capitals, 55–56
physical, 59–63, 208–209
social, 29–30, 69–72, 103–104, 209
capital maintenance
asset valuation, 88
education and R&D, 208
sustainable accounting, 74–80, 89–91
system regulation model, 179–181
capitalism
the importance of rules, 209–210
and religion, 69–70
carbon dioxide
carbon taxes, 95–98, 106
contemporary context, 1–2
forecasting and uncertainty, 35–39
catastrophes in human history, 34–35
citizens’ accounts, 85–86
citizens’ debt and liabilities, 173–175
citizens’ equity, 172–173, 191–194
citizenship
capabilities, 28–31
social tariffs, 160–162
universal basic income, 162–166
universal service obligations (USOs), 156–160, 169–172
classical economics, 135–137
climate change
asymmetric risks, 45–46
capital maintenance, 76–77
constitutional principles, 210–211
contemporary context, 1–2
forecasting and uncertainty, 35–39, 42–43
global agreements, 109–111
limited realistic impartiality, 27
and nuclear power, 18–20
research and knowledge, 64
system regulation model, 184
Coase, Ronald, 99–100
Coase bargaining, 99–101, 106
competitive markets, 47–51
conservation interventions, 57–58
constitutions
being at the table, 201–202, 226–227
benefits of, 198–200
embedding the intergenerational constitution, 214–216
embedding the polluter-pays and precautionary principles, 205–206
first principle, 203–205
formalising sticky rights, 202–203
for future generations, 197, 207–209
limiting government discretion and the importance of rules, 209–210
proving the rules are being followed, 212–214
stability benefits, 216–217
a sustainable economy, 12–13, 226–227
ways of amending, 210–212
consumption
basic income and national dividends, 169–172
citizens and their capabilities, 28–31
contemporary context, 1–14
from the Labour Standard to the Consumption Standard, 140–141
living beyond our means, 107–109
our legacy, 223–224
polluter-pays principle, 9–11, 93–94
pure impartiality, 21–24
social capital, 29–30
sustainable consumption, 132–134, 153–154
sustainable consumption and investment, 141–149
contract regulation, 185–188
cost–benefit analysis, 88
COVID-19 pandemic
impact of lockdowns, 192–193
labour market and productivity, 148–149
cross-subsidies, 160–162
cultural norms, 70
culture of a society, 72
data, and digitalisation, 121–123
debt
citizens’ debt and liabilities, 173–175
fiscal deficits, 147
Keynesian theory, 147, 148
Modern Monetary Theory (MMT) approach, 149–151
national accounts, 88, 91–92
our legacy, 218–227
remedial investments, 82
sustainable accounts, 8–9
Victorian era economics, 142–143
decentralised economy, 135–137
demand, see supply and demand
digitalisation, and zero marginal costs, 119–121
discounting the future
distributional argument, 25–26
economic growth argument, 24–25
nuclear power, 19–20
pure impartiality, 21–24
throughout human history, 18
distributional argument, impartiality principle, 25–26
economic context
Austrian economics and entrepreneurs, 46–48
forecasting and uncertainty, 39–41
ideas, knowledge and human capital, 63–69
polluter-pays principle, 102–105
economic growth
classical economics, 135–137
contemporary trends, 1–14
fiscal deficits, 147
forecasting and uncertainty, 36
impartiality principle, 24–25
living beyond our means, 107–109
our legacy, 225–226
social capital, 69–72
sustainable consumption and Keynesian theory, 132–134
economic policy
classical economics, 135–137
Keynesian theory, 138–140
Modern Monetary Theory (MMT), 149–151
pollution and market failure, 94–99
Thatcherite, 152–153
education
attainment and human capital, 68–69
capital maintenance, 208
funding for, 79
system regulation model, 188
energy industry
marginal costs and public goods, 117–120, 123–124
physical infrastructure, 86–87
enforcement
fairness of the polluter-pays principle, 103–104
polluter pays in the absence of global enforcement, 109–111
enhancement investments, 80–83
entrepreneurs, and Austrian economics, 46–48, 51–53
environmentalism
altruism towards the next generation, 16–18
limiting consumption, 91–92, 153–154
overpopulation, 24
self-interest and social capital, 71–72
equity approach, 172–173
European Union (EU) membership, 211–212
externalities
Coase bargaining, 99–101
living beyond our means, 107–109
marginal costs/damages, 95–96
market failure, 98–99
Pigouvian taxes, 95
fairness, polluter-pays principle, 103–104
fertilisers, agricultural, 104–105
financial crisis (2007/8), 144–146, 148–149
forecasting, challenges of, 35–39, 41–44, see also uncertainty
fossil fuels
contemporary context, 1–2
and net zero, 18–19
physical capital, networks and infrastructure, 59–63
generational differences
altruism towards the next generation, 16–18
citizens and their capabilities, 28–31
a constitution for future generations, 197, 207–209, 214–216
limited realistic impartiality towards, 26–28
the next generation, 15–16, 31–33, 201–202
our legacy, 218–227
pure impartiality, 21–24
social capital, 71
system regulation model, 188–190
uncertainty about the future, 37–39
global population, see world population
global temperatures, 1–2, see also climate change
governments, see also constitutions
EU membership, 211–212
externalities and government failure, 98–99
following constitutional rules, 212–214
limiting government discretion and the importance of rules, 209–210
our legacy, 218–227
greenhouse gases, 35–39, see also carbon dioxide; climate change
gross domestic product (GDP)
discounting and economic growth, 24–25
forecasting and uncertainty, 36
a sustainable economy, 7, 192–193
Hayek, Friedrich von, 47–51, 142, 164
healthcare, system regulation model, 188
Hicks, John, 123, 139
human capital, 63–69
capital maintenance, 79, 208
constitutional principles, 208
enhancement investments, 83
human population, see world population
impartiality principle
citizens and their capabilities, 28–31
distributional argument, 25–26
economic growth argument, 24–25
limited realistic impartiality, 26–28
the next generation, 31–33
the pure impartiality argument, 21–24
time-invariant, 17
inequality, 166–169, see also social justice
inflation, 148
inflows, institutional model, 191–194
informational failures, 98–99
infrastructure systems, 59–63, see also system regulation model
basic income and national dividends, 169–172
coordination problem, 125–129
foreign ownership, 90–91
national accounts, 86–87
nationalised industries vs. privatisation, 177–178
our legacy, 219
rethinking the provision of public goods, 131
integrated assessment models (IAMs), 42–43
interest rates, 149, 215–216
the intergenerational constitution, 214–216, see also generational differences
International Energy Agency (IEA), 36
investments
asset valuation, 87–89
capital maintenance, 74–80
remedial and enhancement, 80–83
sustainable consumption, 141–149
system regulation model, 188–190
Italy, natural capital example, 55–56
job market, see labour market
justice, polluter-pays principle, 103–104
Keynesian theory, 84, 138–140
citizens’ debt and liabilities, 174–175
consumption and green growth, 132–134
Modern Monetary Theory (MMT) approach, 149–151
nation state and the world economy, 151–153
our legacy, 220
protectionism, 151–153
sustainable consumption, 153–154
Knightian uncertainty, 40–41, 47–48
knowledge, as part of human capital, 63–69
labour market
classical economics, 135–137
COVID-19 pandemic, 148–149
Keynesian theory, 134, 138–140, 148–149
Labour Standard, 140–141
and the Consumption Standard, 140–141
Keynesian theory, 139–140
law, see regulatory structures
learning-by-taxing, 106
liberal political theory, 198
licening, system regulation model, 181–184, 187–188
limited realistic impartiality, 26–28
living standards, see standard of living
lobbying
externalities, 98–99
public goods, 115
regulating and prohibiting, 111–113
Locke, John, 198
macroeconomics, 91–92
citizens’ equity, 172–173
classical economics, 135–137
constitutional principles, 214–215
pollution and market failure, 94–99
social justice, 155
Malthus, Thomas, 136
marginal costs, 95–96
coordination problem, 125–129
coordination problem in systems and infrastructures, 125–129
digitalisation and zero marginal costs, 119–121
distinction from average costs, 117
market failure, 121–125
paying for public goods, 129–130
public goods, 114–119
universal service obligations (USOs), 156–160
zero marginal cost in the sustainable economy, 114–115
market competition, 47–51, 135–137
market failure
Coase bargaining, 99–101
externalities, 98–99
marginal costs/damages, 121–125
Pigouvian taxes, 97–98
pollution, 94–99
public goods, 114–119
theory of the second best, 96–97
mass extinctions, 34–35
media, and social capital, 72
microeconomics, 94–99
minerals, use of natural capital, 58
Modern Monetary Theory (MMT), 149–151
the external position, 151–153
monetary policy, 215
monopolies
coordination problem, 125–129
externalities, 98–99
market failure, 121–125
residual monopoly and contract regulation, 185–188
myopia, 16–18
nation state, Keynesian theory, 151–153
national accounts, 83–85, see also sustainable accounting
asset valuation, 87–89
debt as part of, 88, 91–92
foreign ownership of assets, 90–91
sustainable consumption, 132–134
national dividend, 191–194
National Infrastructure Commission, UK, 190–191
nationalised industries
foreign ownership, 90–91
vs. privatisation, 131, 177–178
rethinking the provision of public goods, 131
natural capital
capital maintenance, 74–80
natural vs. other capitals, 55–56
for the next generation, 31–32, 207–208
non-renewable and renewable, 5–7, 57–59
other capital dependent upon, 32–33
as primary asset, 56–59
as public good, 118–119
a sustainable economy, 7–14
system regulation model, 179–181
negative interest rates, 149
neo-Ricardian effect, 146–147
neo-Ricardian equivalent theory, 146–147
net zero
constitutional principles, 210–211
cost estimates, 98–99
and fossil fuels, 18–19
networks, infrastructure systems, 59–63
non-renewable natural capital, 5–7, 57–59
nuclear power, 18–20
open societies, 48–49
operational capital maintenance, 77–78
Orwell, George, 164
outflows, institutional model, 191–194
outsourcing net zero, 101
overpopulation, 24
pay-as-you-go principle, 88–89
peat, ban on, 112
pesticides, polluter-pays principle, 104–105
physical capital, 59–63, 208–209
Pigou, Arthur, 95, 100
Pigouvian taxes, 95–98
Austrian approach, 105–106
global agreements, 110–111
planning
Austrian economics and entrepreneurs, 46–48
system regulation model, 190–191
politics, see also constitutions
EU membership, 211–212
forecasting and uncertainty, 37–39
Keynesian approach, 138–140
from the Labour Standard to the Consumption Standard, 140–141
limiting government discretion and the importance of rules, 209–210
open societies, 48–49
our legacy, 218–227
polluter-pays principle, 102–105
the problem with planning, 49–51
polluter-pays principle
in the absence of global enforcement, 109–111
Coase bargaining as alternative, 99–101
in constitutional terms, 205–206
impact on consumption, 9–11, 93–94
justifications for, 102–105
market failure, 94–99
our legacy, 222–223
pollution taxes (Austrian school approach), 105–106
pollution
capital maintenance, 77–78
living beyond our means, 107–109
market failure, 94–99
prices, 113
regulating and prohibiting, 111–113
remedial investments, 81–82
taxes in Austria, 105–106
Popper, Karl, 65–67
population, see world population
poverty
distributional argument, 25–26
inequality and the problem of the ultra-rich, 166–169
pure impartiality, 21–24
social insurance, 163–164
social justice, 12
precautionary principle
asymmetric risks, 44–46
Austrian economics and entrepreneurs, 46–48
in constitutional terms, 205–206
price, incorporating pollution costs, 113, see also Pigouvian taxes
price cap regulation, 181–184, 187
privatisation
vs. nationalisation, 131, 177–178
rethinking the provision of public goods, 131
universal service obligations (USOs), 156–160
prohibiting pollution, 111–113
property rights
carbon taxes, 106
Coase bargaining, 99–101
and public goods, 115–116
prosperity, 218, see also the sustainable economy
protectionism, 151–153
Protestantism, 69–70
public goods
coordination problem in systems and infrastructures, 125–129
externalities, 98–99
marginal costs, 117–120, 124–125
market failure, 114–119
paying for, 129–130
rethinking the provision of, 131
universal basic income, 162–166
universal service obligations (USOs), 156–160
public interest, distinction from public goods, 115
quality of life, see standard of living
quantitative easing (QE), 149–151, 216
Ramsey, Frank, 21
Rawls, John, 199
regulating pollution, 111–113
regulators
closing down the economic regulators, 190–191
system plan delivery, 184–185
system regulation model, 181–184
regulatory asset bases (RABs), 171, 188–190
regulatory structures
global agreements, 109–111
polluter-pays principle, 111–113
the sustainable economy, 12–13
religion
and capitalism, 69–70
social capital, 72
remedial investments, 80–83
renewable natural capital, 57–59
capital maintenance, 75
contemporary context, 5–7
cost–benefit analysis, 88
as public good, 118–119
research and development (R&D), 208
residual monopoly, 185–188
resilience, 41–44
revolutions, 209–210
rewilding, 57–58
risk, asymmetric, 44–46
risk aversion, 200
Russia, natural capital example, 55–56
Schumpeter, Joseph, 47–48
second best, theory of, 96–97
Smith, Adam, 135–137
social capital, 69–72
capital maintenance, 79–80
constitutional principles, 209
consumption, 29–30
polluter-pays principle, 103–104
social contract, 198, 217
social justice
basic income and national dividends, 169–172
distributional argument, 25–26
educational attainment and human capital, 63–69
inequality and the problem of the ultra-rich, 166–169
infrastructure, 62–63
pure impartiality, 21–24
the sustainable economy, 11–14, 155–156
universal basic income, 162–166
universal service obligations (USOs), 156–160
social tariffs, 160–162
socialism, universal basic income, 162–166
stakeholders, system regulation model, 183–184
standard of living, see also consumption
the Consumption Standard, 153–154
from the Labour Standard to the Consumption Standard, 140–141
living beyond our means, 107–109
progress since 1900, 2–3
sustainable consumption, 83–85, 153–154
state, see governments; nation state
Stern, Nick, 23
stewardship concept
citizens’ equity, 172–173
as constitutional principle, 203–205
for the next generation, 201–202
subsidies, sustainable consumption, 160–162
supply and demand
classical economics, 136
investment, 141–149
sustainability, Brundtland Report, 31
sustainable accounting, 7–9, 73–74
asset valuation, 87–89
assets balance sheet, 85–87
capital maintenance, 74–80, 89–91
consumption, 132–134
contrast with existing accounts, 83–85
macroeconomics, 91–92
remedial and enhancement investments, 80–83
sustainable consumption, 132–134
and the Consumption Standard, 153–154
cross-subsidies, 160–162
investments, 141–149
social justice, 155–156
social tariffs, 160–162
universal basic income, 162–166
the sustainable economy, 3–14
based upon uncertainty, 53–54
natural capital, 7–14
the next generation, 15–16
our legacy, 218–227
radical departure from conventional economics, 33
social justice, 11–14
technical progress, 51–53
zero marginal cost, 114–115
system regulation model, 178–179
closing down the economic regulators, 190–191
delivery of, 176–178, 184–185
generational links, 188–190
knowing what you have got, 179–181
a new institutional architecture, 194–196
regulating the national dividend and the wealth fund, 191–194
regulators, 181–184
residual monopoly and contract regulation, 185–188
taxation
global agreements, 109–111
inequality and the problem of the ultra-rich, 166–169
living beyond our means, 107–109
Pigouvian, 95–98, 106
pollution taxes the Austrian way, 105–106
revenue raised by pollution taxes, 97
social justice, 11–12
sustainable economic growth, 192–193
taxpayer accounts, 85–86
technology
asymmetric risks, 44–46
capital maintenance, 77–78
digitalisation and zero marginal costs, 119–121
ideas, knowledge and human capital, 63–69
physical capital, networks and infrastructure, 59–63
the sustainable economy, 51–53
system regulation model, 179–181
Thatcherite policy, 152–153
time-invariant impartiality principle, 17
trade, protectionism, 151–153
trade unions, 152–153
trickle-down economics, 25–26
Trump, Donald, 198
uncertainty
asymmetric risks, 44–46
Austrian economics and entrepreneurs, 46–48
and decision-making, 39–41
and forecasting, 35–39
the problem with planning, 49–51
in regulatory rules, 112–113
resilience, 41–44
the sustainable economy based upon, 53–54
technical progress and the sustainable economy, 51–53
unknown unknowns, 40–41
universal basic income, 162–166
universal service obligations (USOs), 156–160, 169–172, 176–178
utilitarianism
citizens and their capabilities, 28–31
pure impartiality, 21–24
the sustainable economy, 33
the sustainable economy based upon uncertainty, 53–54
veil of ignorance, 199
vested interests, 115
Victorian era economics, 135–137, 142–143
wages
financial crisis (2007/8), 144–146
Keynesian theory, 134, 144–146
social justice, 12
water regulation, 182, 191
wealth fund, 191–194
wealthy individuals, and inequality, 166–169
world population
classical economics, 136
contemporary context, 1–2
overpopulation, 24
uncertainty about the future, 38
zero marginal cost
digitalisation, 119–111
market failure, 121–125
public goods, 116–118
in the sustainable economy, 114–115

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  • Index
  • Dieter Helm, University of Oxford
  • Book: Legacy
  • Online publication: 19 October 2023
  • Chapter DOI: https://doi.org/10.1017/9781009449212.016
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  • Index
  • Dieter Helm, University of Oxford
  • Book: Legacy
  • Online publication: 19 October 2023
  • Chapter DOI: https://doi.org/10.1017/9781009449212.016
Available formats
×

Save book to Google Drive

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  • Index
  • Dieter Helm, University of Oxford
  • Book: Legacy
  • Online publication: 19 October 2023
  • Chapter DOI: https://doi.org/10.1017/9781009449212.016
Available formats
×