Neo-classical economic theory. Social Sciences Essay

Neo-Classical Economic Theory
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Neo-Classical Economic Theory
Herman Daly is credited with the popularization of the concept of a steady state economy or economics of stable in his book “Towards a Steady State Economy” published in 1973 (Patterson, 2009). Daly is one of the founders of ecological economics, a field of research that studies how human economies interact with the natural environment. The economist likens neo-classical economic theorists to biologists attempting to understand the functioning of an animal by solely considering its circulatory system while disregarding its digestive system that links the animal firmly to its ecosystem at both ends. Like other classical economic experts such as Malthus, Mill, and Ricardo, Daly differs with the neoclassical economic theorists as regards to having economies witness a constant growth (Mendel University, n.d). According to Daly, neoclassical economists fail to factor in the costs of growth when determining economic growth. This is analogous to trying to understand the functioning of an animal by considering its circulatory system that accounts for the total input and output without accounting for what is lost during digestion and to the environment.
Unlike “Trumponomics” or Trumpism, Daly recommends that economists should account for the cost of growth so that countries can decide to stop growing when...