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Article summaries WeconomyLecture 1 – Introduction
Jonker & Faber (2017) – Framing the Weconomy
Introduction
We must make a change from the present economy. Central stands the idea that a linear economy –
as designed and enlarged up to a point that it becomes impossible to think and reason outside this
way of thinking – has reached a point that it destructs instead of creates value. New initiatives are
often arising from within society and can be captured by one phrase: Think globally, act locally. These
local activities, referred to as citizen-driven initiatives (CDI), are ways to overcome the disconnection
with society.
Due to globalisation, the internet, and social media, we are moving from a ‘me’ society to a ‘we’
society. We represents sharing. Societal changes have led to a shift in community from a local to a
global perspective. Now there is a growing need to come back to the local community. Civic
entrepreneurship is emerging: this is a kind of entrepreneurship that is a collaborative action of
different individuals to take responsibility for improving the quality of life in a community, a
responsibility going beyond their particular social position. The weconomy operates on the principle
of collaboration (and consequently trust) and collective governance. Attempting to create value in a
closed organizational setting which excludes people is too costly and too slow for two reasons.
1. The structure of a closed organization is of a hierarchical nature that is constructed to focus
on the creation of a single value.
The new values and accompanying citizen engagement are the foundation for working in networks –
assumed to be the organisational-economic configurations of the future – rapidly appearing under
the label of HUBs. A HUB locates itself between individuals and only facilitates the connection and
transaction. This new perspective indicates that communities or individuals shape and manage their
own lives. The essence of the HUB is collaborative value-creation.
All kinds of trends are emerging. These trends all emerge from different perspective. The trends:
1. The circular economy In a circular production model, raw materials are central. The core is
to exploit and re-use these raw materials continuously in an endless loop. Bringing raw
materials into and endless loop of reuse implies that, in designing a product, the recovery of
materials becomes the central issue.
2. The functional economy The core of this economic approach is creating and leasing a
function such as heat, mobility, comfort, or the effect of certain chemicals. People purchase a
function instead of a product. This results in keeping supplied products in a well-functioning
state in order to keep the costs for the maintenance and (re)use as low as possible.
3. The bio-based economy The bioeconomy refers to the set of economic activities relating
to the invention, development, production and use of biological products and processes.
Typically, the term bio-mimicry is used to denote this use of principles from nature to resolve
problems. Discussions include land use and food.
4. The collaborative economy It concerns an economic model based on sharing, swapping,
trading or renting products and services, enabling access over ownership. The collaborative
and sharing economies build on the assumption that goods and services ‘are’; their focus lies
on their distribution only. Four collaborative forms are presented:
, 5. The sharing economy The essence of this trend is that there are many things we no longer
need or want to possess; but as long as we have access to them, their functions can be
shared. In its simple form, the sharing economy leads to a model in which individuals are able
to borrow or rent assets owned by someone else.
6. The self-production or 3D economy In the near future, absolutely everything will be
printed from waste or from conventional raw materials either at home or in a district. 3D is
only possible because there are assets based on commodities and resources. It will bring two
changes for product design:
a. It enables the production of shapes that are more complex; and,
b. It enables a decrease in product weight.
The self-production economy contributes to sustainable manufacturing by being more
efficient than subtractive manufacturing. It also improves population health and quality of
life. It also changes the conception of labour; people change into an active creator. This
economy also support collaborative networks, because in larger projects it involves sharing
work and collective design efforts. 3D hubs facilitate the functional economy in the sense
that these digital platforms provide access to the act of self-production without users having
to individually possess 3D printers. The 3D printer enables sustainable manufacturing which
consequently facilitates the circular economy.
7. Internet of Things (IOT) The essence is the accelerating growth of connections. It is about
a world where physical objects are seamlessly integrated into the information network and
where the physical objects can become active participants in business processes.
While a number of the described developments such ad 3D printing or the functional economy do
not directly stem from considerations regarding sustainability, the way they are presented here
offers a perspective on their potential value with respect to sustainability issues. The crux of the
matter is to search for new organisational forms or, perhaps even better, organisational
arrangements facilitating the organization of sustainability as a shared challenge while
simultaneously respecting what we have already developed.
Kate Raworth (2017) – Exploring doughnut economics
The environmental ceiling in the doughnut economy consists of nine planetary boundaries, beyond
which lie unacceptable environmental degradation and potential tipping points in Earth systems.
TEDx: Why it’s time doughnut economics
In linear economic and macro economy there is a circular loop of money and goods. However, that
loop is fundamentally flawed.
1. The economy is not floating on a white background but is embedded in an environment. The
fundamental flow is not just money going around, but energy coming from the sun for
example.
, 2. Not all work is paid. Family life is ignored by economics.
3. There is a lot of value that is created but that is not monetized. Ignoring the collaborative
commons, then you are ignoring a disruptive part of the economy.
4. Families get wages and dividends: but does this really happen? It is stagnating. Only a tiny
few have a lot of money.
What if economy starts with human well-being? This starts for example with housing, energy,
education etc. Well-being on the other hand depends on our planet. The donut: In the middle is the
space where humanity is not putting pressure on the planet. We must stay below the outer ring: the
environmental ceiling. Protect the life-support systems of the planet. In the middle of the donut is
the social foundation and people should be in between the social foundation and the environmental
ceiling. But currently, we are outside the donut on both sides.
How can we create a financially system that does not destabilize the system but serves the common
interest? What we have to deal with:
- More people in middle class
- Overpopulation
- Effects of climate change
Rifkin (2012) – The third industrial revolution: how the internet,
green electricity, and 3D printing are ushering in a sustainable era of
distributed capitalism
The entire industrial infrastructure built off of fossil fuels is aging and in disrepair.
A new economic narrative
19th century: First industrial revolution with steam machine
20th century: second industrial revolution with centralized electricity communication
, Today we are in the third industrial revolution with internet technology. There are five pillars for this
revolutions:
1. Shifting to renewable energy;
2. Transforming the building stock of every continent into micro-power plants to collect
renewable energies on-site;
3. Deploying hydrogen and other storage technologies in every building and throughout the
infrastructure to store intermittent energies;
4. Using internet technology to transform the power grid of every continent into an energy
internet that acts just like the internet;
5. Transitioning the transport fleet to electric plug-in and fuel cell vehicles that can buy and sell
green electricity on a smart, continental, interactive power grid.
The shift to lateral power
Democratization of communication. The new, green energy industries are improving performance
and reducing cost at an ever accelerating rate. And just as the generation and distribution of
information is becoming nearly free, renewable energies will also.
Distributed capitalism
Energy regimes shape the nature of civilizations. The emerging third industrial revolution is organized
around distributed renewable energies that are found everywhere and are, for the most part, free.
The distributed nature of renewable energies necessitates collaborative rather than hierarchical
command and control mechanisms. The extraordinary capital costs of owning and operating giant
centralized telephone, radio, and television communications technology and fossil fuel and nuclear
power plants in markets is giving way to the new distributed capitalism, in which the low entry costs
in lateral networks make it possible for virtually everyone to become a potential entrepreneur.
Democratizing manufacturing
While the third industrial revolution allows millions of people to produce their own virtual
information and energy, a new digital manufacturing revolution now opens up the possibility of
following suit in the production of durable goods (3D printing).
New business models and jobs in the 21 st century
The transition to the third industrial revolution will require a wholesale reconfiguration of the entire
economic infrastructure of each country, creating millions of jobs and countless new goods and
services.
Rockström et al (2009) – Planetary boundaries: exploring the safe
operating space for humanity
New challenges require new thinking on global sustainability
Human activities increasingly influence the Earth’s climate. We are now in the epoch, the
Anthropocene, where humans constitute the dominant driver of change to the Earth system.
Introducing the concept of planetary boundaries
Thresholds are defined as non-linear transitions in the functioning of coupled human-environmental
systems. Examples are temperature. Boundaries are human-determined values of the control
variable set a ‘safe’ distance from a dangerous level (for processes without known thresholds at the
continental to global scales) or from its global threshold.
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