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away from subsiding to taxing use of non-renewable resources and away from taxing the use of renewable resources, of which labour is possibly the most important.
Recent analyses of the social costs of unemployment and potential social benefits of
a more resource efficient performance economy provide some of the evidence supporting a shift from flow to stock management.
Keywords Circular economy • Flows • Goods as services • Manufactured capital •
Molecules as services • Performance economy • Re-use • Recycling •
Remanufacturing • Reprocessing • Service life • Stocks
1 Introduction
Economic activities, particularly trade, are usually characterised in terms of flows of
goods, energy and services. Many areas of industrial ecology focus on flows, and
concepts such as the “circular economy” are framed in terms of recycling and re-use
flows. However, wealth itself is a stock, not a flow: the wealth of societies is based
on their stocks of goods and capital. Arguably, the quality of life in a developed
society depends more on the quantity and quality (Q&Q) of its stock than on the
flows through the economy. Stocks represent accumulated flows. Therefore, the
flows needed to develop and maintain capital stocks are important, particularly in
developing economies; the relationship between flows and stocks is explored in
Chap. 6. But this chapter explores some of the insights revealed by focussing on
managing and using the stocks themselves rather than flows. This is one of the central principles in the concept of the “performance economy” (Stahel 2010).
Various authors (e.g. Forum for the Future 2015) have proposed categorisations
of the stocks available to a society. Most categorisations propose five forms of capital; for example, in the context of this chapter:
• Natural capital
• Cultural capital
• Human capital
• Manufactured capital
• Financial capital.
Natural capital can be treated as a Global Commons, using a stock management
approach, such as sustainable fishing and forestry. If a flow maximisation approach
is applied instead, natural capital will inevitably be degraded, repeating the “Tragedy
of the Commons”; obvious examples are over-fishing, loss of biodiversity and accumulation of foreign substances such as toxins, salts and plastic debris.
Maintaining quality with its associated tensions is also a widespread concern for
Cultural capital; the UNESCO world heritage programme is regularly faced with
the dilemma of balancing protecting sites against their economic exploitation.
W.R. Stahel and R. Clift
away from subsiding to taxing use of non-renewable resources and away from taxing the use of renewable resources, of which labour is possibly the most important.
Recent analyses of the social costs of unemployment and potential social benefits of
a more resource efficient performance economy provide some of the evidence supporting a shift from flow to stock management.
Keywords Circular economy • Flows • Goods as services • Manufactured capital •
Molecules as services • Performance economy • Re-use • Recycling •
Remanufacturing • Reprocessing • Service life • Stocks
1 Introduction
Economic activities, particularly trade, are usually characterised in terms of flows of
goods, energy and services. Many areas of industrial ecology focus on flows, and
concepts such as the “circular economy” are framed in terms of recycling and re-use
flows. However, wealth itself is a stock, not a flow: the wealth of societies is based
on their stocks of goods and capital. Arguably, the quality of life in a developed
society depends more on the quantity and quality (Q&Q) of its stock than on the
flows through the economy. Stocks represent accumulated flows. Therefore, the
flows needed to develop and maintain capital stocks are important, particularly in
developing economies; the relationship between flows and stocks is explored in
Chap. 6. But this chapter explores some of the insights revealed by focussing on
managing and using the stocks themselves rather than flows. This is one of the central principles in the concept of the “performance economy” (Stahel 2010).
Various authors (e.g. Forum for the Future 2015) have proposed categorisations
of the stocks available to a society. Most categorisations propose five forms of capital; for example, in the context of this chapter:
• Natural capital
• Cultural capital
• Human capital
• Manufactured capital
• Financial capital.
Natural capital can be treated as a Global Commons, using a stock management
approach, such as sustainable fishing and forestry. If a flow maximisation approach
is applied instead, natural capital will inevitably be degraded, repeating the “Tragedy
of the Commons”; obvious examples are over-fishing, loss of biodiversity and accumulation of foreign substances such as toxins, salts and plastic debris.
Maintaining quality with its associated tensions is also a widespread concern for
Cultural capital; the UNESCO world heritage programme is regularly faced with
the dilemma of balancing protecting sites against their economic exploitation.
W.R. Stahel and R. Clift