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Home > Business Ethics Thinkers > Herman Daly

Business Ethics Thinkers

Herman Daly

The founding father of ecological economics

Timeline

1938
Born in Houston, Texas.
1967
Received doctorate in economics from Vanderbilt University.
1968
Appointed associate professor at Louisiana State University.
1973
Appointed professor at Louisiana State University.
1976
Received the Distinguished Research Master Award from Louisiana State University.
1977
Publication of Steady-State Economics.
1983
Appointed alumni professor of economics at Louisiana State University.
1988
Appointed senior economist in the Environment Department of the World Bank.
1989
Publication of For the Common Good, which he coauthored.
1994
Appointed senior research scholar, School of Public Affairs, University of Maryland.
1996
Received the Right Livelihood Award.
1996
Received the Heineken Prize for Environmental Science, awarded by the Royal Netherlands Academy of Arts and Sciences.
1996
Publication of Beyond Growth.
1999
Publication of Ecological Economics and the Ecology of Economics.
2001
Received the Leontief Prize.
2007
Publication of Ecological Economics and Sustainable Development.
2008
Named Man of the Year by Adbusters magazine.
2010
Received a lifetime achievement award from the National Council for Science and the Environment.

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Life and Career

Herman Daly has been a greatly influential figure in the development of the interdisciplinary field of ecological economics through his research and study of economic development, sustainability, population, resources, and the environment, and the publication of over 100 articles in scholarly journals and magazines. Although remaining in academia throughout his career, he also worked at the World Bank, where he helped to develop policy guidelines related to sustainable development, and cofounded the International Society for Ecological Economics, and was associate editor of its journal, Ecological Economics.

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Key Thinking

  • While studying under Nicholas Georgescu-Roegen, he analyzed limitations to economic growth, welfare economics, ecology, and sustainable development to produce a theory of steady-state economics.

  • Daly argued that environmental costs must be reflected in the market prices of goods and services, and proposed that a sort of “steady state” can be achieved in which the burden caused by economic production does not exceed the natural capacity of the environment.

  • He produced many specific policy proposals for moving to a steady-state economy, including ecological tax reform, limiting inequality in income distribution, freeing up working times to allow for greater flexibility, and re-regulating international commerce.

  • He also helped to develop ecological economics, arguing that human economy is embedded in nature and that economic processes are actually biological, physical, and chemical processes and transformations.

  • In For the Common Good with theologian John Cobb, he examined the consequences of economics moving from an academic discipline to one that is engaged with the real world.

  • In Beyond Growth, which received worldwide attention, he discussed the impact of unchecked growth on a finite planet and how a sustainable future could be achieved.

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In Perspective

  • His controversial views on economic growth and environmental protection for sustainable development meant that Daly was seen by many as a maverick.

  • He is widely credited with originating the concept of uneconomic growth through his research on environmental problems related to macroeconomic activity.

  • He was a key figure in helping ecological economics to become a discipline in its own right, separate from environmental economics.

  • He proposed that a sustainable world cannot be achieved through constant growth, but that the focus should be on community rather than the individual, on steady-state economics, the introduction of ecological taxation, and a rejection of free trade.

  • At the World Bank, he argued that it is possible to create environmentally sustainable development through a number of means, such as countries taxing labor and income less, maximizing the productivity of natural capital in the short run, and investing in increasing its supply in the long run.

  • He sees globalization as a major obstacle to recognizing and addressing the problem of uneconomic growth, and a return to the nation state as a way of avoiding the oligopoly of trading blocs.

  • In recent years, Daly has also focused on economic welfare and its measurement, producing the important Index of Sustainable Economic Welfare.

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Quotation

“There is something fundamentally wrong in treating the Earth as if it were a business in liquidation.”

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Further reading on Herman Daly

Books:

  • Daly, Herman E. Steady-State Economics: The Economics of Biophysical Equilibrium and Moral Growth. San Francisco, CA: W. H. Freeman, 1977. Daly describes how a steady-state economy can be created and maintained, and how biophysical limits to growth underline the importance of shifting to a steady-state economy.
  • Daly, Herman E. Beyond Growth: The Economics of Sustainable Development. Boston, MA: Beacon Press, 1996. Daly counters economic orthodoxy, exploring how current theories of sustainable development cannot solve the problem of diminishing natural resources, and proposes some radical solutions.
  • Daly, Herman E. Ecological Economics and Sustainable Development: Selected Essays of Herman Daly. Cheltenham, UK: Edward Elgar, 2007. This collection of essays, speeches, reviews, and testimonies provides a thorough guide to Daly’s views on ecological economics and how to realize real sustainable development.

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