Exploring Doughnut Economics: A Novel Economic Model for the Planet and the People

When Covid-19 first became a focal point of global news, the significant economic impact that the pandemic caused was unfathomable–for instance, as I entered the spring of my freshman year, when hearing the first announcement that school was postponed, my first thought was a rush of relief that my biology test had been pushed back four days. Yet, as the tumultuous environment fostered by the virus has continued for over two years, the world has been forced to adapt to the rampant unemployment, supply chain disruptions, food shortages, inflation, and energy crises that continue to plague the functionality of the global economy. In response, various cities including Amsterdam, Brussels, Copenhagen, and Berlin have internalized the concept that modern problems require novel solutions, and thus are experimenting with the Doughnut Economic model to restore their economies and create a more sustainable post-Covid social and economical development.

The term “Doughnut Economics” has certainly piqued my interest, and that’s not because I’ve always had a sweet tooth. I recently began reading Doughnut Economics written by Kate Raworth and learned that the model is a radical compass that guides us to our chance of thriving in balance with the living planet. It champions regenerative development in an effort to tackle the environmental crisis and ecological collapse at hand while meeting basic human and societal needs. Raworth believes that the safe and just space for humanity lies in between its ecological ceiling of planetary pressure and its social foundation of human well-being.

The “Doughnut” of social and planetary boundaries. Source: KateRaworth.com

I’ve learned that Doughnut Economics proposes 7 overarching ways to rethink economics.

1. Change the goal from fixating on GDP growth to discovering how to thrive in balance with safe and just spaces. So far, we have transgressed both sides of the Doughnut’s boundaries.

2. Focus on seeing the big picture and embedding the economy within society and nature.

3. It’s possible to nurture human natures in ways so that we can socially reciprocate instead of remaining self-interested, have fluid values instead of fixed preferences, and move from isolation to interdependency.

4. Understand the vast complexity of economics such as the dynamics of finance, inequality, and ecological degradation. Considering each of these factors, design a system that’s distributive and regenerative.

5. Inequality is not an inevitable economic necessity—conversely, lack of equity amongst communities is a design failure. There are ways to design economies to be more distributive of the value we generate.

6. Ecological degradation is the result of degenerative industrial design. We need to create circular,

not linear, economies in order to restore humans as full participants in nature’s processes of life.

7. Move from growth addicted to growth agnostic. While mainstream economics views endless economic growth as a must, nothing in nature grows forever. Existing economies have an innate need to grow, no matter whether that growth helps us thrive. What we need are economies that make us thrive, no matter whether they grow or not.

As someone who’s passionate about the economic impact on the environment and approaches to sustainable economic development, I’ll be closely watching the experimentation and adoption of Doughnut Economics, a model for the planet and the people.