Kate Raworth > Quotes

“For over 70 years economics has been fixated on GDP, or national output, as its primary measure of progress. That fixation has been used to justify extreme inequalities of income and wealth coupled with unprecedented destruction of the living world. For the twenty-first century a far bigger goal is needed: meeting the human rights of every person within the means of our life-giving planet.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Depicting rational economic man as an isolated individual – unaffected by the choices of others – proved highly convenient for modelling the economy, but it was long questioned even from within the discipline. At the end of the nineteenth century, the sociologist and economist Thorstein Veblen berated economic theory for depicting man as a ‘self-contained globule of desire’, while the French polymath Henri Poincaré pointed out that it overlooked ‘people’s tendency to act like sheep’.31 He was right: we are not so different from herds as we might like to imagine. We follow social norms, typically preferring to do what we expect others will do and, especially if filled with fear or doubt, we tend to go with the crowd. One”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Here’s the conundrum: No country has ever ended human deprivation without a growing economy. And no country has ever ended ecological degradation with one.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“When Adam Smith, extolling the power of the market, noted that, ‘it is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner’, he forgot to mention the benevolence of his mother, Margaret Douglas, who had raised her boy alone from birth. Smith never married so had no wife to rely upon (nor children of his own to raise). At the age of 43, as he began to write his opus, The Wealth of Nations, he moved back in with his cherished old mum, from whom he could expect his dinner every day. But her role in it all never got a mention in his economic theory, and it subsequently remained invisible for centuries.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Economics is the mother tongue of public policy,”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“In the words of the systems thinker John Sterman, ‘The most important assumptions of a model are not in the equations, but what’s not in them; not in the documentation, but unstated; not in the variables on the computer screen, but in the blank spaces around them’.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“availability bias—making decisions on the basis of more recent and more accessible information loss aversion—the strong preference to avoid a loss rather than to make an equivalent gain selective cognition—taking on board facts and arguments that fit with our existing frames risk bias—underestimating the likelihood of extreme events, while overestimating our ability to cope with them.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Despite their current rhetoric of ‘free trade’, when it comes to trade negotiations almost all of today’s high-income countries—including the UK and the United States—took the opposite route to ensure their own industrial success, opting for tariff protection, industrial subsidies and state-owned enterprises when it was nationally advantageous. And today they still keep tight control over their key traded assets such as intellectual property.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Nudges and network effects often work because they tap into underlying norms and values—such as duty, respect and care—and those values can be activated directly.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Homo sapiens, it turns out, is the most cooperative species on the planet, outperforming ants, hyenas, and even the naked mole-rat when it comes to living alongside those who are beyond our next of kin.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“The possibility of shaking off old mental models is enticing, but the quest for new ones comes with caveats. First, always remember that ‘the map is not the territory’, as the philosopher Alfred Korzybski put it: every model can only ever be a model, a necessary simplification of the world, and one that should never be mistaken for the real thing. Second, there is no correct pre-analytic vision, true paradigm or perfect frame out there to be discovered. In the deft words of the statistician George Box, ‘All models are wrong, but some are useful.’39 Rethinking economics is not about finding the correct one (because it doesn’t exist); it’s about choosing or creating one that best serves our purpose—reflecting the context we face, the values we hold, and the aims we have. As humanity’s context, values and aims continually evolve, so too should the way that we envision the economy.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“We have an economy that needs to grow, whether or not it makes us thrive. We need an economy that makes us thrive, whether or not it grows.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“GDP is a cuckoo in the economic nest. And to understand why, you need to know a thing or two about cuckoos because they are wily birds. Rather than raise their own offspring, they surreptitiously lay their eggs in the unguarded nests of other birds. The unsuspecting foster parents dutifully incubate the interloper’s egg along with their own. But the cuckoo chick hatches early, kicks other eggs and young out of the nest, then emits rapid calls to mimic a nest full of hungry offspring. This takeover tactic works: the foster parents busily feed their oversized tenant as it grows absurdly large, bulging out of the tiny nest it has occupied. It’s a powerful warning to other birds: leave your nest unattended and it may well get hijacked.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“There are clearly many ways to more equitably share the wealth that lies beneath our feet. Ostrom was quick to point out, however, that there is no panacea for managing land and its resources well: neither the market, the commons nor the state alone can provide an infallible blueprint. Approaches to distributive land design must fit the people and the place, and may well work best when they combine all three of these approaches to provisioning.44”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“global greenhouse gas emissions is highly skewed: the top 10 percent of emitters—think of them as the global carbonistas living on every continent—generate around 45 percent of global emissions, while the bottom 50 percent of people contribute only 13 percent.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“…environmental quality is higher where income is more equitably distributed, where more people are literate, and civil and political rights are better respected. It’s people power, not economic growth persay, that protects local air and water quality. Likewise, it is citizen pressure on government and companies for more stringent standards, not the mere increase in revenue that compels industries to switch to cleaner technologies.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“If there is one task that merits the attention of the twenty-first-century economist, it is this: to come up with economic designs that would enable nations coming towards the end of their GDP growth to learn to thrive without it.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“One person who was willing to risk political suicide was the visionary systems thinker Donella Meadows—one of the lead authors of the 1972 Limits to Growth report”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Governments have historically opted to tax what they could, rather than what they should, and it shows.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Economics (...) is not a matter of discovering laws: it is essentially a question of design.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“argues the evolutionary psychologist Gerd Gigerenzer: we have survived and thrived not despite our cognitive biases but because of them. These so-called biases are the underpinnings of our heuristics, the unconscious mental shortcuts we take every time we use a ‘rule of thumb’ to make decisions. Over millennia, the human brain has evolved to rely on quick decision-making tools in a fast-moving and uncertain world, and in many contexts those heuristics lead us to make better decisions than exact calculations would do.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“drop the economist’s beloved notion of ‘externalities’, those incidental effects felt by people who were not involved in the transactions that produced them—such as toxic effluent that affects communities living downstream of a river-polluting factory, or the exhaust fumes inhaled by cyclists biking through city traffic. Such negative externalities, remarks the ecological economist Herman Daly, are those things that ‘we classify as “external” costs for no better reason than because we have made no provision for them in our economic theories’.21 The systems dynamics expert John Sterman concurs. ‘There are no side effects—just effects,’ he says, pointing out that the very notion of side effects is just ‘a sign that the boundaries of our mental models are too narrow, our time horizons too short’.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“high leverage points like changing the goal, by booting out the cuckoo of GDP growth and aiming for the Doughnut instead. Other powerful leverage points include finding ways to weaken growth’s reinforcing feedback loops while strengthening balancing ones instead.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Such an economy must help to bring everyone above the Doughnut’s social foundation. To do so, however, it must alter the distribution not only of income but also of wealth, time and power.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Likewise, rather than focusing by default on how to increase economic activity, ask how the content and structure of that activity might be shaping society, politics and power. And just how big can the economy become, given Earth’s ecological capacity?”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Kenya has been a trailblazer in mobile banking since launching its M-PESA mobile money service in 2007. Within six years, three quarters of all Kenyan adults had used the service, including 70 percent of those in rural areas, and—astonishingly—over 40 percent of Kenya’s GDP was passing through M-PESA.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“Third, nurture human nature. At the heart of twentieth-century economics stands the portrait of rational economic man: he has told us that we are self-interested, isolated, calculating, fixed in taste and dominant over nature—and his portrait has shaped who we have become. But human nature is far richer than this, as early sketches of our new self-portrait reveal: we are social, interdependent, approximating, fluid in values and dependent upon the living world.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“George’s proposal for a land-value tax—an annual levy on underlying land values as a fair means of generating public revenue—echoed John Stuart Mill’s earlier call to tax ‘rentier landlords’ who ‘grow richer, as it were in their sleep, without working, risking, or economising’.37 Inspired by such reasoning, land value taxes are now in use—albeit in diluted form—from Denmark and Kenya to the United States, Hong Kong and Australia. But taxation to George was essentially a substitute for a more systemic fix: land, he believed, should be owned in common by a community, rather than by landowners.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“What kind of currency, then, could be aligned with the living world so that it promoted regenerative investments rather than pursuing endless accumulation? One possibility is a currency bearing demurrage, a small fee incurred for holding money, so that it tends to lose rather than gain in value the longer it is held. The fact that demurrage is an unfamiliar term shows how accustomed we are to the ever-rising financial escalator that we ride – like knowing the idea of ‘up’ but not ‘down’, ‘more’ but not ‘less’. But demurrage is a word worth knowing because it could just feature in the financial future.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

“One diagram in economic theory is so dangerous that it is never actually drawn: the long-term path of GDP growth. Mainstream economics views endless economic growth as a must, but nothing in nature grows forever, and the attempt to buck that trend is raising tough questions in high-income but low-growth countries. It may not be hard to give up having GDP growth as an economic goal, but it is going to be far harder to overcome our addiction to it. Today we have economies that need to grow, whether or not they make us thrive; what we need are economies that make us thrive, whether or not they grow. That radical flip in perspective invites us to become agnostic about growth and to explore how economies that are currently financially, politically and socially addicted to growth could learn to live with or without it.”
― Kate Raworth, Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist