Self-study
P1
Recently, a new school of economics called steady-state economics has seriously challenged neoclassical economics, the reigning school in Western economic decision making. ███
Intro topic ·
Steady-state economics (new view) vs. neoclassical economics (traditional view)
Neoclassical view ·
Economy is closed system between producers and consumers
Growth is necessary and unlimited
P2
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Steady-state view ·
Economy is open system dependent on nature
Neoclassical view is wrong; not a closed system. Resources enter system, waste leaves.
Implications ·
of steady-state view
Growth is neither necessary nor unlimited. Economy has optimal size in theory. Too much growth is dangerous because it depletes resources and creates waste.
Neoclassical rebuttal ·
Natural resources can be replaced if depleted
P3
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problem ·
according to steady-state view
Western economies have exceeded optimal size
Solution ·
according to steady-state view
Meet human wants without growth, e.g. by using resources more efficiently
Passage Style
Critique or debate
16.
According to the passage, steady-state ██████████ ███████ ████ █████████ ████████ ██████ ██ █████████ ███████ ██
a
may deplete natural █████████ ██████ ████ █████ ███████ █████████ ███ ██████████ ██ ███████ ████
Unsupported. The passage does not mention discovery of new natural resources, so this is not support for the steady-state economists that is stated in the passage.
b
may convert natural █████████ ████ ████████ ██████ ████ ████ █████████ ████████ ███ ███ ██████████ ███
Unsupported. The information in (B) is not given in the passage as support for the steady-state economists’ claim about the dangers of unlimited growth.
c
may proliferate goods ███ ████████ ██████ ████ ██ █████████ ███ ███████ ███ ████
Unsupported. The passage does not mention the rate of market generation, so this is not support for the steady-state economists’ opposition to unlimited growth that is stated in the passage.
d
may create income ██████████ ██████ ████ ██ ███████ ███ ███████ ██████ ██ ███████ ████
Unsupported. Actually, some neoclassical economists see unlimited growth as a
e
may increase the ████ ██ ███ ███████████ ██████ ████ ██ █████████ ████████ ██ █████████ ███ █████████
This is supported in P2.