Can doughnut economics be implemented into the mainstream approach to economics Assignment Sample

Introduction: Can Doughnut Economics Be Implemented Into The Mainstream Approach To Economics?

The issue of how Doughnut Economics can be incorporated into the mainstream thought in economics can be posed, and it is both essential and important. Thus, the given topic reflects the concern about the current global issues of inequality and environmental depletion on the one hand, and the inability of classical economical theories to solve them on the other hand. Being an economics student these are the approaches to the subject that capture the interest the most as they provide an appropriate and thorough solutions. Kate Raworth introduced Doughnut Economics, which was “Seven Ways to Think Like a 21st Century Economist” which can provide such a focus.

This investigation found a great interest from this study because it is a way of economically transitioning from vices of exclusion and devastation to values of inclusion and regeneration beyond the exploitation of human needs for profit. The purpose of analysing the concepts and the methods of Doughnut Economics is to assess the potential of changing the conventional policies and providing recommendations to the policymakers. Therefore, It concerned by the applicability of this model and how it could be transferred and applied to a variety of settings, from local government up to national policies.

The main analysis of this assignment will focus on the discussion of the theoretical framework of Doughnut Economics and the possibilities of its application in conventional economics system. This includes the study of successful models like for instance modelling of Amsterdam and looking at the likes of countries that have shown interest in implementing this model including New Zealand and Scotland. Furthermore, the discussion on the strategies for the implementation of the proposed concept will consider some obstacles and threats that may be met during the process: the resistance of powerful economic stakeholders; the necessity to involve representatives of different fields in the implementation of the concept.

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Literature review

Systematic literature review on the concept

According to Sahan et al 2022, The various crises of the 21st century’s intensification climate and ecological, social injustice of power and chances have demonstrated that the present global economic model is unsustainable if all of the Earth, human and otherwise, is to survive in a harmonious manner. Doughnut Economics offers an increasingly familiar orienting device for such a flourishing future, and is centered on people’s needs within the ecological ceilings of the living Earth, with economies that are restorative and redistributive by default. What does this mean for the role and the change of business itself, if it wants to be a part of this future? This paper maps the proprietary, Deep Design of Business through a firm’s Purpose, Networks, Governance, Ownership, and Finance and how it influences strategic choices and operational outcomes of a firm as well as whether businesses can transition to become part of a restorative and distributive economy (Sahan et al 2022). Thus, through exploring five levels of deep design, it is possible to identify design obstacles that hinder radical change as well as the opportunities for design to enact change. Furthermore, this paper acknowledges that it’s at the industrial and systems levels that such change is necessary to transform the inheritance of a degenerative and divisive economic system into the embryos of a regenerative and distributive one (Crisp, et al, 2024). The central proposition, Revolutionizing the architecture of business with regards to its Purpose, Networks, Governance, Ownership and Finance is required for business to become restorative and distributive in so far as it strategies, activities and outputs and thus to support humanity to transcend the emergent business Steady State of being inside the Donut. In partnership with this paper, one also finds the Doughnut design for business tool, which maps businesses’ journey of enterprise redesign to operationalize these concepts. And in this way, it seeks to foster a plethora of investments, innovations, actions, and solutions that support the development of businesses and economies characterized by regenerative and distributive logics (Wahlund and Hansen, 2022). Business executives, partner organizations, representatives of trade unions, freelancers, researchers, activists, policymakers, and all those who are seeking to change business and the broader economy for the better are welcome to join this process through using the tool and reading this paper. Collectively, this orientation and corresponding toolbox will empower countless regenerative and distributive opportunities to be translated into practice on the back of innovations in the profound configuration of commerce.

Figure 1: The Doughnut of social and planetary boundaries

(Source: Sahan, et al, 2022)

Benefits of implementing the concept principal

According to Eriksson 2022, Recently these approaches such as Kate Raworth’s fresh paradigm on degrowth macroeconomic known as “doughnut economics” (DE) are found in the policies of varying sizes across the globe. It supersedes the current generation’s daunting challenges through calling for more holistic and equilibrium flow of the development that does not compromise the earth’s health and safeguards social progress (Eriksson 2022). Since the introduction of the framework, many European cities have begun to apply Raworth’s ideas in their policies, it is very beneficial to implement the doughnut economics concept in the mainstream approach to economics. However, there are few previous researches that undertake a critical analysis of this new model of economy. However, this is a considerable research gap in the literature, and therefore, the thesis will seek to explore how the model addresses growth and urbanization by adopting critical theories to start engaging with the attempt to get towards a critical appraisal of the structure. The first Swedish city that considered the model is Tomelilla thus, using the case study method, the thesis looks into the municipality perspective on growth, urbanization, and the model (Gross, 2020). The questions discussed here were investigated in four semi-structured interviews with key leaders in Tomelilla and the content analysis of the doughnut economics’ core book. All interviews were then thematically analyzed based on four main themes that emerged from the theoretical framework, and the broad topics that include urbanization, growth, the doughnut model, and housing.

Thus, the evaluation proves that there is a significant similarity between the viewpoints of the municipality and Raworth’s visions since the city officials, for example, regard growth as an option in the further sense. This model creator addresses the entire field of economics by proposing a new language and depiction of the most important principles in mainstream economics. Nevertheless, considering the case with Raworth’s participation in the discourse of the growth and urbanization, it can be stated that there is a certain necessity of additional critical theories in order to have an opportunity to open up the certain discourses for the further debates and reflections. There are the issues and certain overviews found in Raworth’s consideration of growth.

Figure 2: Overshoot doughnut

(Source: Eriksson 2022)

Challenges of implementing the concept principal

According to Rodrik 2024, In the last few decades, mainstream economics is intertwined with a specific policy that is commonly called “neoliberalism” The neoliberal policy is characterized by making markets, including global ones, as broad as possible and limiting the possibilities of governmental interventions. Thus, today it is acknowledged that this approach was very deficient in a number of aspects (Rodrik 2024). Instead, it even deepened the domestic inequality, provided scant support to the climate transition and introduced blind spots across the board from global public health to the domestic supply chain, therefore, is a critical issue relating to the main challenge of implementing this concept principal. Thus, it can be stated that the neoliberal period did have a major accomplishment. Sustaining high economic growth rates in most of the emerging economies and the largest one in particular led to a stellar decrease in extreme poverty rates globally (Castro, et al, 2022). However, the success story during this period such as China highly did not conform to neoliberal doctrines. The avowed ‘market liberals’ used industrial policies, state enterprises, and capital controls as much as they employed free markets. At the same time, the countries following most of the neoliberal policies and advice like Mexico performed the worst. Many of us are aware that economics is actually a way of thinking rather than a list of performances to be fulfilled. The instruments of modern economics provide very little of the certainties and prescriptions, which flow from the neoclassical assumptions. Principles like the first-order principles of thinking at the margin, of seeking efficiency where people’s self-interest will lead them to bear the cost and reap the gain of a resource’s use, attempting fiscal responsibility and a sound money. are simply ideas that do not rationalise straightforward solutions. China itself is a perfect example of how relative economic principle can be. But it did so by unorthodox innovation, the household responsibility system, dual track pricing, which would not occur in standard policy advice of Western economists but which were necessary to ease domestic political and second-best constraints. In economics the right answer to virtually is on any policy question it depends. On the one hand, this is the strength of economic analysis, and it shines most when it analyses how and why these contextual dependencies, and the differences in the economic environment this affects outcomes are present such as, policy consequences. The error of the neoliberal paradigm can be considered as the tilt towards thinking that there are standard best practices widely applicable. For the intensification of speed in neoliberalism’s processes of economic action, it was bad economics at that time is present.

Figure 3: Doughnut of social and planetary boundaries

(Source: Rodrik 2024)

Examples of applied the Concept

According to Hausdorf and Timm 2023, this paper advances SBM research by adopting a fresh theoretical framework from doughnut economics (DE). Thus, this type of research, as an integrative literature review, will help analyse concepts corresponding to the seven principles of DE at the business model level (Peeters, 2022). Based on the literature review for this paper, It can segregated 23 concepts related to SBM which is outlined in detail using the cognitive science theory. Based on this framework, there is a distinction between seven abstract and 16 concrete concepts for a structured approach in understanding to how SBMs can reflect DE principles.

The contribution of this study can be articulated along three folds. Firstly, the developed framework increases the theoretical clarity and comprehensiveness of concepts that are reflected in SBM, with DE as one of its components (Hausdorf and Timm 2023). This differentiation enriches authors’ understanding by presenting these concepts as operating at abstract and concrete levels at the same time while showing how SBMs and DE are interconnected. This research contributes to theoretical knowledge and will allow academics to advance and develop later research on the comprehension of DE principles within business models.

Second, this research reveals seven Branding opportunities to spearhead the further progress of the SBM discipline. These factors are the key areas through which DE principles could be incorporated into SBMs more comprehensively, thus providing potential research paths for scholars and more application prospects for DE practice. Thus, by pointing to these paths, invite the scholars to deepen the insights into the sustainability integration in business models and continue the search for innovative strategies in this sphere.

Thirdly, it has a positive implication in supplementing theories and practices as this study’s finding could contribute to more innovative developments in executing SBM. Thus, providing the clear framework and pointing out the further research directions, contribute to the practical applying of DE principles by businesses. This practical relevance gives evidence to practice dimension of this research by making sure that what is discovered does not only add to the advancement of knowledge in the business and management academics, but will also help compel businesses to ‘buy-into’ sustainability and novelty.

The literature review outlined in this paper presents an integrated analytical framework for comprehending SBMs with the help of the DE approach, reveals new research directions, and suggests useful recommendations for companies. This four-fold contribution emphasizes the need for incorporating the DE principles into SBMs, thus opening up to the real possibility of sustained and innovative business models.

Opportunities for future implementation of the concept principal

According to Eichberg and Charles 2024, Doughnut economics (DE) has become a revolutionary development approaching the provision of people’s well-being and the conservation of the planet’s resources. DE envisions the future, with humanity’s security and justice besides critical social needs, all unilaterally with no breaching of ecological limits. Thus, this integrative review of literature discusses further possibilities for applying the principles of DE to pursue the SDGs to find out from the literature what others have not yet explored in their studies.

The Sustainable Development Goals or the SDGs are 17 integrated goals that aim to tackle the world’s most pressing issues within the international development framework and were adopted in 2015 by the US. DE is an economic model which is holistic in nature proposed by Kate Raworth and is symbiotic to the SDGs because it focuses on doing economic activities within the sustainable ecological space with social justice (Eichberg and Charles 2024). Thus, the DE together with the SDGs embodies the right environment for chancing new perspectives for sustainable development.

DE is structured around seven key principles: changing the goal to redefine the purpose of economy from GDP to well-being of people, systemwise seeing the big picture of including ecology and society into economy, cultivating human instincts to values cooperation and reciprocal relationship, getting intelligent with system to understand that economy is complex and interdependent, designing to distribute to make fair distribution possible, creating to restore to introduce restoration in economy, and being humble about growth to concentrate on good economy in terms of growth.

Opportunities for implementation abound Government can therefore, with concerted coordination, come up with integrative policy frameworks through which national policies are conditioned to uphold DE principles in relation to its economic undertakings in social foundation and ecological ceiling (Everett, 2022). This type of policies advance the cause of the multiple SDGs within the one policy, for instance, poverty reduction, consumption patterns, and conservation of the terrestrial ecosystem. Another facet of interest also lies in organizations’ proactivity in establishing DE principles into organizational practice. Through practicing sustainability and circular economy strategies, organisations participate in the improvement of sustainability in production processes and climate change mitigation. The success of Business Models that are innovation oriented on social and environmental aspects can foster considerable advancement in the achievement of the SDGs.

Others are educational and culture changes the level of education and the prevailing culture have to improve in order to accommodate such new inventions. The incorporation of DE into educational systems can possibly bring up a generation of leaders who are both sustainable and equitable. Culturally appealing changes such as using available resources to sustain the cities and communities can foster responsible consumption and production practices (Kraskes, 2022). DE principles should be adopted by community-based processes because they can result in the development of sustainable and resilient communities. Projects involving communities and aimed at management of the local resources, renewable energy and social inclusion may address goals such as affordable and clean energy, reduced inequalities and sustainable communities.

Partnership along with sharing of ideas, information and research findings are important for increasing the development and implementation of DE principles across the world (Moretti, 2022). Partnership and sharing of information between countries and through use of international forums can increase the rate of implementation of effective measures for the attainment of the SDGs as well as improve climate responsiveness.

Conclusion and recommendations

Doughnut Economics is one of the most important and essential concepts of economics which was designed by Kate Raworth to solve the most acute problems of the present world civilization, such as inequality and the climate crisis. This model shifts from the non-sustainable policies for GDP growth and offers more plausible measures of development that is sustainable both in terms of usage of the Earth’s resources and human satisfaction. Thus, seeing the model’s continued development, backed up by references to specific cities, such as Amsterdam or countries, including New Zealand and Scotland, it is possible to note the changes in economic policies on the city and national levels.

The concept of Doughnut Economics proceeds with solving various aspects of the respective economical and social issues, as it corresponds well with the SDG. This poses a model of societal interaction that seeks to organized economic transactions in such a way that they do not degrade the environment and at the same time uplift the standard of social living. This is rather a comprehensive shift of thinking as compared to a simplistic employment of growth which only resulted to environmental exploitation and widened social disparities.

Despite its potential in changing the ways economists practice their trade, the process of applying Doughnut Economics into standard political economic practices has its own set of issues. This is more so given that neoliberal frameworks that provide a rigid ethos of market rationality and less state interference provide stiff resistance to this effort. There is also a problem in the lack of easy shift from previous economic conventions and there is also the opposition from entrenched economic structures. Embedded in these challenges is the need for a radical change of course in approach at both the policy and operational levels, involving all the key stakeholders governments, businesses, and citizens.

Here are some strategic actions that are rather crucial to apply Doughnut Economics, First, policies that establish and increase the use of social and environmental management systems instead of the conventional economic indicators are necessary. Second, realistic innovations should be adopted by the companies. That are compatible with Doughnut principles, that is sustainable and distributional justice. Third, educational systems have to integrate Doughnut Economics into their curricula in order to raise aware new leaders who can implement these concepts. Finally, international cooperation and knowledge exchange will be instrumental in the further enhancement of the proposals put forward by Doughnut Economics.

Recommendations:

1. Policy Integration: Governments should create and implement acculturative policies, which shall place policy activities and goals within the framework outlined by Doughnut Economics to guarantee that national policies promote sustainability and work towards the welfare of the society and ecology.
2. Business and Community Engagement: Promote Doughnut Economics among business and communities. This also involves practicing sustainability in business strategies and social ideas that serve environmental and social objectives.
3. Educational and Cultural Shifts: Encourage the educational efforts and the needed cultural shift that would help people wrap their heads around Doughnut Economics. This will enable the future leaders to accept and apply such principles when they are likely to be in leadership positions.
4. Global Collaboration: Invest in international collaborations to disseminate research, identify good practices and advances in the understanding and application of DE and in the global promotion of the conceptual framework of Doughnut Economics within the framework of the SDGs.

Reference List

Journals

• Castro, J.F.G., Evangelio, C.E.A., Saguiguit, C.A.G. and Pasquin, E.G., 2022. Is the Philippines within the Doughnut?: Quantifying Doughnut Economics through Sustainability Window Method.em>International Journal of Research in Engineering, Science and Management,em>5(11), pp.194-206.
• Crisp, R., Waite, D., Green, A., Hughes, C., Lupton, R., MacKinnon, D. and Pike, A., 2024. ‘Beyond GDP’in cities: Assessing alternative approaches to urban economic development.em>Urban Studies,em>61(7), pp.1209-1229.
• de Jong, M., 2021. Inclusive capitalism: The emergence of a new purpose paradigm in economics and business administration and its implications for public policy.em>Global Public Policy and Governance,em>1(2), pp.159-174.
• Eichberg, E.T.A.M. and Charles, A., 2024. The Role of the Civic University in Facilitating Inclusive and Transformative Pedagogical Approaches to the Sustainable Development Goals: A Systematic Literature Review.em>Sustainability,em>16(7), p.2752.
• Eriksson, F., 2022.em>Towards a critical understanding of Doughnut Economics (Doctoral dissertation, MA Thesis]. Lund University).
• Everett, E., 2022. Combining the circular economy, doughnut economy, and permaculture to create a holistic economic model for future generations.em>Environmental Sciences Proceedings,em>15(1), p.19.
• Gross, P.L., 2020. Better together? How the Doughnut Economics Action Lab organizes communities for transformative action.
• Hausdorf, M. and Timm, J.M., 2023. Business research for sustainable development: How does sustainable business model research reflect doughnut economics?.em>Business Strategy and the Environment,em>32(6), pp.3398-3416.
• Kraskes, J., 2022. Universities and the Doughnut Strategy: Comparative analysis of university strategies and the integration of planetary and social boundaries and the general concept of sustainable development.
• Moretti, M., 2022.em>Can Doughnut Economics fill Amsterdam’s dietary needs?: a critical examination of the city’s new circular and climate strategy (Doctoral dissertation, European University Institute).
• Olsson, D., 2020. The transformative potential of resilience thinking: How it could transform unsustainable economic rationalities.em>Alternatives,em>45(2), pp.102-120.
• Peeters, J., 2022. Sustainability and new economic approaches. An exploration for social work research.em>SPSW Working Paper Series.
• Preluca, A., 2021. Doing Business in the Doughnut: The sustainability of worker co-operatives.
• Rodrik, D., 2024. Addressing Challenges of a New Era.em>Finance & Development.
• Sahan, E., Ruiz, C.S., Raworth, K., van Winden, W. and van den Buuse, D., 2022. What Doughnut Economics means for business: creating enterprises that are regenerative and distributive by design.
• Savini, F., 2023. Post-growth, degrowth, the doughnut, and circular economy: a short guide for policymakers.em>Journal of City Climate Policy and Economy.
• Wahlund, M. and Hansen, T., 2022. Exploring alternative economic pathways: a comparison of foundational economy and Doughnut economics.em>Sustainability: Science, Practice and Policy,em>18(1), pp.171-186.
• Hayaloğlu, P. and Artan, S., Rethinking Sustainability and Growth in the Anthropocene.em>CURRENT DEBATES ON, p.29.
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