Economics for people and planet – moving beyond the neoclassical paradigm

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Examples of alternative schools of thought in economics and their relevance to public health

Ecological economy

key ideas

Sees the economy as a subsystem of society, which is a subsystem of the biosphere. Analyzes economic processes, not only in terms of monetary indicators, but also in terms of resource use and associated social outcomes. Ecological economics also argues that many environmental problems are caused by the extent of economic activity exceeding environmental limits.
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Ecological economics: principles and applications.

Public health relevance

Substantial and varied evidence concerning the relationships between the economy, health and the environment.
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  • Vogel J.
  • Steinberger J.K.
  • O’Neill DW
  • WF Lamb
  • Krishnakumar J.
Socio-economic conditions for meeting human needs with low energy consumption: an international analysis of social provisioning.

The focus on meeting basic needs within planetary boundaries could be adopted by the broader health field and is part of recent discourse (eg, for planetary health).

Institutional economics

key ideas

Institutions (defined as formal and informal rules), rather than markets, govern the most important decisions within the economy. Institutional economics considers the role of transaction costs and path dependencies (the concept that change is affected by historical context, which often shapes and limits the scope of change).

Public health relevance

A recognition of the important role that laws, policies and culture play in shaping economic outcomes, including health outcomes. The importance of local and regional economic development agencies and major economic institutions (eg, central banks and the International Monetary Fund) to population health is increasingly clear.
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  • Naik Y
  • Abbes I
  • Elwell Sutton T
  • Bibby J
  • Spencelayh E
Using economic development to improve health and reduce health inequalities.

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  • Boyce CJ
  • Delaney L
  • Ferguson E
  • AM wood
Central bank interest rate decisions, household indebtedness and psychiatric morbidity and distress: evidence from the UK.

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The effects of the International Monetary Fund on global health: before and after the 2008 financial crisis.

Economics of complexity

key ideas

Sees the economy as a complex system, interacting with other complex systems (such as population health and the environment). Emphasis is placed on the uncertainty created by constant change and the characteristics of nonlinearities, feedback loops, tipping points and emergence.
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Complexity theory and social sciences: the state of the art.

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  • Mercury JF
  • Pollitt H
  • Bassi AM
  • Viñuales I
  • Edwards RN
Modeling of complex systems of heterogeneous agents to better design transition policies towards sustainability.

Public health relevance

Understanding the relationships between three complex systems (the health of populations, the environment and the economy) requires specific methods. Innovations in modeling the complex systems of the economy could be deployed to study how economic factors affect health. The identification of interventions having an impact must take into account the structure and behavior of the economic system.

Evolutionary economy

key ideas

Aims to understand how and why economic systems change over time. Emphasizes path dependency (in common with institutional economics), innovation processes and technological change.

Public health relevance

Recognizes that the economy is not a static system in equilibrium, but a process of dynamic change. Uncertainty and lack of knowledge are seen as the main economic problems, rather than scarcity. Evolutionary economics resonates with the changing nature of public health.

Post-Keynesian economics

key ideas

Economic results depend on effective demand. Full employment (that is, where everyone who can and wants to work can find a job) does not emerge automatically through market processes. Governments have an important role to play in promoting demand and full employment through investment.

Public health relevance

Highlights the role of government intervention in achieving health outcomes, which are influenced by employment levels and social inequalities.

Behavioral economics

key ideas

Critique the idea of ​​a rational homo economicus. Behavioral economics highlights the psychological and social processes that influence decision-making, including the role of values ​​and norms, temporal discounting, loss aversion, and rules of thumb.

Public health relevance

Recognize that the design of health interventions, as well as economic policies that influence health outcomes, must be based on a more realistic view of human behavior.

Marxian political economy

key ideas

Emphasizes the role of power asymmetries and unequal distribution of resources among economic actors in shaping the structure of the economy and in driving economic growth and exploitation.

Public health relevance

The analysis of health outcomes and the design of health interventions must take into account the unequal distribution of resources and power. Marxist political economy emphasizes the positive role that greater equality can have in improving health outcomes.

feminist economics

key ideas

Criticizes mainstream economics for ignoring the important role that informal, non-market activities have for economic outcomes and well-being, especially the role of caregiving and household chores that are predominantly done by women.

Public health relevance

Feminist economics includes greater recognition of the role of the informal economy for health and well-being outcomes and the need to measure and reward their contribution.

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