04 May '11, 3pm

Guest blog from Herman Daly: Not production, not consumption, but transformation via @SteadyStateEcon

Guest blog from Herman Daly: Not production, not consumption, but transformation via @SteadyStateEcon

If we were to speak of a “transformation function” rather than a production function then we would naturally have to specify what is being transformed, into what, by the agency of what? Natural resource flows are transformed into flows of goods (and wastes), by the fund agents of labor and capital. A transformation function must show both the agents of transformation (funds of labor and capital that are not themselves transformed into the product but are needed to effect the transformation), and the flow of resources that are indeed physically embodied in the flow of products, or waste. This distinction between fund and flow factors immediately reveals their complementary roles as efficient cause and material cause — any substitution between them is very limited. You cannot bake the same cake with half the flour, eggs, etc. by doubling the number of cooks and the size of t...

Full article: http://www.neweconomics.org/blog/2011/05/04/not-productio...

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grist.org 04 May '11, 2pm

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