“I initially wondered whether it was a good idea to use a calorie bomb like the doughnut as a metaphor for an economic model. But you must admit that it is an image that stays with you.”
Professor Ingrid Molderez, head of the Research Centre for Economics and Corporate Sustainability (CEDON) on the Brussels campus of KU Leuven, met Kate Raworth in 2017 when she came to Belgium to mark the publication of the Dutch translation of her book Doughnut Economics: Seven Ways to Think Like a 21st Century Economist. In this book – a global bestseller – Raworth argues for an economic model that strikes a balance between fulfilling essential human needs and respecting the limits of our planet. Klaas Collin, chair of the KU Leuven Student Council, explains: “Providing enough food, education, healthcare, etc. is the inside edge of the doughnut. But at the same time, we must take the exhaustibility of natural resources, the preservation of biodiversity, climate change, etc. into account, and that is the outer edge of the doughnut. The challenge for this century is to stay within the ‘sweet spot’ of the doughnut, which Raworth calls the ‘safe and just space’.”
It is an inspiring model and she is an inspiring lady, agrees Professor Molderez: “I find it particularly interesting that Raworth studies economics in the original sense of the word. Economics that goes back to the Greek concept of oikos, being prudent and treating things with due diligence, including the natural world. Our approach to economics has an excessive emphasis on chrematistike, profit maximalisation. Raworth has a much broader perspective.”
This broader view is thanks to Raworth’s education in philosophy, politics and economics at Oxford, her work with micro businesses in Zanzibar, and later at the UN, where she contributed to the Human Development Report, and her work as a researcher for Oxfam. She is currently affiliated with the Environmental Change Institute at the University of Oxford, and the Cambridge Institute for Sustainability Leadership.
Raworth questions theories, concepts and approaches that we have used for decades.
“We focus on precisely the themes that are central to Raworth’s work,” says Kris Bachus at HIVA (the Research Institute for Work and Society): “For example, our Sustainable Development Research Group studies the climate tax shift: a transition from taxing labour to taxing natural resources and pollution, with the intention of tackling climate change – think of the outer edges of the doughnut. At the same time, a central element of the climate tax shift is that you ensure that it does not adversely affect the most vulnerable groups in society. And that is the inner edge of the doughnut.”
According to Bachus, Raworth’s most important achievement is that she explains difficult and complex concepts like sustainable development in a way that is accessible for everyone, even children: “As scientists, we must dare to admit that only a few of us ever really manage to reach the general public.”
Kate Raworth has no problem doing that. The Guardian described her as ‘one of the top ten tweeters on economic transformation’. Doughnut Economics has been translated into eighteen languages.
Kate Raworth has responded to the call to articulate a new approach to economics.
“I think it is very interesting that a woman is taking the lead in this field,” Molderez says. “Raworth is thus part of a tradition of female researchers, from Rachel Carson, who was the first person to denounce the negative effects of DDT in the 1960s, to Elinor Ostrom, who in 2009 became the first woman to win the Nobel Prize for economics, along with Oliver Williamson.”
Raworth has a unique method of communicating her ideas: “I attended one of her lectures again in 2018. At a certain point, she pulled one of those Knex balls out of her pocket and threw it in the air to illustrate her point. And it works.”
“Following the publication of Raworth’s book, various researchers made a similar doughnut for different countries,” says Professor Karel Van Acker. “You see that many Western countries treat their doughnut well – not perfectly, but well – but that they transgress its outer limits. Countries in the Global South usually stay within the boundaries of the outer limit but are not able to provide for the basic needs of their population. There are no countries that fulfil all the basic needs without transgressing the limits. However, several cities – including Amsterdam and Brussels – are now using the doughnut model as a touchstone to evaluate their ambitions.”
Professor Van Acker is likewise affiliated with CEDON – among others – and regularly gives lectures about Kate Raworth’s work: “Her great merit is that she is able to combine many elements in a coherent whole, from the report of the UN Brundtlandt Commission in 1987 – which already contains the idea of needs and limits – to the ideas of Johan Rockström at the Stockholm Resilience Center, which inspired her to describe the outer circle of the doughnut. Based on her background at Oxfam, she also places a strong emphasis on the social dimension. She manages to survey the complexity of the economy. And she is able to communicate it very comprehensively. Science is not only about studying things in detail, but also about elaborating a holistic concept and connecting things. That is precisely what Kate Raworth does.”
Molderez: “Do you know that sculpture by Picasso, a bull’s head made with the handlebars and seat of a bicycle? You could have made that yourself and you might even have the parts you need at home, but the difference is that you didn’t make it. This applies to Raworth’s work: she has created her own holistic picture using various existing theories.”
Kate Raworth takes aim at the traditional economics programmes.
Professor Sandra Rousseau has good memories of Kate Raworth’s visit to the Brussels Campus in October 2017: “She is very enthusiastic, and we were able to exchange ideas in a small group. I use Raworth’s model in every course I teach, including in environmental economics and sustainable management. For some students, it is the first time that they look at things outside the traditional frameworks. The doughnut model is a very useful illustration of how you can conceive and think about the economy in a different way.”
Rousseau’s colleague Professor Marc Craps has been discussing Kate Raworth’s work in his Corporate Social Responsibility classes for several years. “It is sometimes a bit of a challenge to introduce students to these kinds of courses after they have studied economics for several years. Raworth’s work helps enormously because she refers to classical economic theories. She thus offers students ideas that are sufficiently new and challenging, but also ones that are not too far outside their frame of reference.”
Raworth has profound critiques of classical economic models and concepts, however. This appeals to many students, Klaas Collin says: “We currently use the same parameters as we did in the past to evaluate how well we are doing: economic growth, gross domestic product. We should stop doing this, Raworth says. Our economy cannot continue growing infinitely because it will overburden the planet. We need new indicators to inform us of whether we are on the right track.”
Raworth encourages professors to reflect more on the economy that we teach,” says Ingrid Molderez. “She takes aim at the traditional economics programmes,” Van Acker adds: “She thinks that they are based too much on oversimplified models that only cover subsections of the economy, while it is the complexity itself that is very important. She wants to base the economy on theories around sustainability.”
“Many economists share Raworth’s vision that we should move to a society that focuses less on economic growth,” says environmental economist Professor Johan Eyckmans. “But she sometimes does not do justice to economic science. For example, one of her seven recommendations is to focus more on behavioural economics, but people have focused on that for a long time and there are even subdisciplines such as behavioural finance. A great deal of research is now also conducted into distributive and sustainable economics.”
“Raworth does make an important point when she says that many of these insights have not found their way into classical handbooks or are not treated in introductory courses. As a result, universities are still forming people who have studied the fundamentals of the economy, but have not learned anything about subjects like distribution, public goods, environmental effects, etc. But the KU Leuven handbook ‘Economie – een inleiding’ is a counterexample because it does cover these issues in depth and also contains critiques of the classical GDP growth concept.”
Professor Sandra Rousseau likewise emphasises that many economists have a broader perspective than many might suspect: “The traditional approach that you learn in an introduction to economics does not really reflect what economists are doing in 2020. Economists are now very conscious of the fact that people do more than attempt to make their profit as high as possible. We now know that other considerations play a role in our behaviour, such as altruism. Many of Raworth’s ideas about income inequality and consumer behaviour, for example, have been part of our discourse for some time; especially among economists who focus on environmental economics and corporate sustainability.”
“But perhaps we do not sufficiently show the extent to which we work on this. In any case, Kate Raworth has opened many people’s eyes. She forms a bridge between the academic and the social, which I think is extremely important.”
Raworth believes that we can create a world in which we can provide for everyone’s basic needs in a sustainable way.
Not all scientists agree with Raworth’s positions. This need not surprise us, says Kris Bachus: “She questions many of the theories, concepts and approaches that we have used for decades. At the same time, and this is unique, Raworth’s doughnut model has managed to bridge the gap between die-hard free market economists and climate and environmental activists who want radical change. Neither party feels threatened by her model.”
Raworth reflects both on the larger economic system and on its concrete content in terms of corporate sustainability and social responsibility. Professor Molderez’s research focuses on the latter: “Think, for example, of platform cooperation, in which you share things, such as cars, but not based on profit-oriented motivations. Just like Raworth, I think that as professors, we should focus on what is happening in society.”
Professor Molderez and her students visit organisations that take a different approach to the economy, like Open Source, which ensures that the ground water that is pumped up during construction projects is used to water plants or to clean streets. “This is a good example of what Raworth calls ‘create to regenerate’. There is a lot of dynamism in phenomena that exist somewhat in the margin; innovation and creativity are being cultivated there. That makes me enthusiastic and it is the source of my passion for research.”
It is only by questioning fundamental concepts that we can make society progress.
“Raworth also argues for a transformation of our concept of value,” says Professor Van Acker. “According to her, economic value does not lie primarily in the selling of as many products as possible, but in repeatedly deriving value from materials, human capital, and the knowledge from which they are made.”
“Where classical economics views economic behaviour as a sum of rationally calculating individuals, the ecological economy views society as communities attempting together to discern what is valuable to them,” adds Professor Craps. “I can imagine that classically trained economists would no longer call this ‘economics’. But I suspect that Kate Raworth would respond that this is precisely the kind of economy that we need.”
“Raworth says that we must find new indicators for ‘value’,” Van Acker says. “That is something we do for the circular economy in our research group. With respect to the mobility system in Flanders, for example, we start from the question: ‘What is the demand; how much do we want to travel?’ We then analyse the material and energy this requires, and we use that data to make indicators upon which policymakers can based concrete policy. Open data is very important to move to a doughnut economy, as Raworth emphasises.”
In her book, Raworth also champions a transition to the circular economy. “But she also formulates critiques of it,” says Van Acker. “Companies and policymakers are currently taking a fragmented approach to the circular economy, while it should be an interplay of all the stakeholders involved in a materials circle. Open data is likewise essential here because the different parties must of course share the information. For example, we research how one might achieve this through a materials or production passport, which the European Commission is now also promoting.”
Doughnut Economics contains inspiring examples, but Raworth does not offer solutions for all of today’s problems, Sandra Rousseau says. “Wicked problems like climate change are of course too complex for that. The doughnut can serve as a tool for reflection and the book is primarily a call to action.” But her message is optimistic: “Raworth believes that we can create a world in which we can provide for everybody’s basic needs in a sustainable way, and which prioritises human wellbeing.”
Kate Raworth is an inspiration to the students, concludes Klaas Collin. “She challenges us to question theories and shows us that we must not cling to the doctrines we were taught – in any branch of science. She encourages students to be critical, to think out of the box, and to look for solutions to today’s problems. She reminds us why we study at university. Indeed, it is only by questioning fundamental concepts that society can make progress.”