Robin Hahnel - Ecological Economics

Ecological Economics

Throughout much of this time Hahnel had been teaching advanced courses in ecological economics at American University. His ecological economic vision seeks to incorporate the ecological and social costs entailed in production, consumption, and distribution in the price signals for each good. Because of the widely recognized difficulties of quantifying ecological and social costs, Hahnel emphasized the necessity of utilizing qualitative data in addition to quantitative data to ensure accurate price signals. Qualitative data can best be elucidated through the mechanisms of an inclusive and participatory democratic informational framework.

In terms of the current day ecological problems Hahnel acknowledges that green and pollution taxes are likely to be more effective than alternative schemes such as the marketization of natural resources using permit systems or regulatory "command and control" methods. An optimally efficient green tax requires taxing polluters an amount equal to external costs. Corporations can be expected to try to pass the extra costs on to consumers by raising prices, however Hahnel notes that "part of the reason pollution taxes improve efficiency in a market economy is that they discourage consumption of goods whose production requires pollution precisely by making those products more expensive for consumers." He recommends linking tax increases related to "bads" such as pollution to tax decreases on "goods" related to productive work, as exemplified by social security taxes. (The ABC's of Political Economy, 272)

From an international strategic perspective however, he has thrown his support behind a cap and trade system. He argues that progress has been made toward a cap and trade system and should not be discarded, that such a system would foreground scientific and climatological expertise rather than economic expertise, and that such a system is much more achievable on an international level.