Nicholas Georgescu-Roegen

Nicholas Georgescu-Roegen
Born	4 February 1906 Constanţa, Kingdom of Romania
Died	30 October 1994 Nashville, Tennessee, U.S.
Residence	Romania, France, United Kingdom, United States
Citizenship	Romania
Fields	Economics, Mathematics, Statistics
Institutions	University of Bucharest^(1932–46), Harvard University^(1934–36), Vanderbilt University^(1950–76), Graduate Institute of International Studies^(1974), University of Strasbourg^(1977–78)
Alma mater	University of Bucharest, Paris Institute of Statistics, University College London
Academic advisors	Traian Lalescu, Émile Borel, Karl Pearson, Joseph Schumpeter
Doctoral students	Herman E. Daly
Other notable students	Kozo Mayumi, Muhammad Yunus
Known for	Utility theory, Consumer choice theory, Production theory, Ecological economics
Influences	Aristotle, Rudolf Clausius, Ernst Mach
Influenced	Herman E. Daly, Kozo Mayumi, Jeremy Rifkin, Robert Costanza, Cutler J. Cleveland, John M. Gowdy, Joan Martinez Alier, Jacques Grinevald, Serge Latouche, Malte Faber, Enzo Tiezzi, Mario Giampietro, Mauro Bonaiuti

Nicholas Georgescu-Roegen, born Nicolae Georgescu (4 February 1906 – 30 October 1994) was a Romanian American mathematician, statistician and economist. He is best known today for his 1971 magnum opus The Entropy Law and the Economic Process, where he argued that all natural resources are irreversibly degraded when put to use in economic activity. A paradigm founder in economics, Georgescu-Roegen's work was seminal in establishing ecological economics as an independent academic subdiscipline in economics.

Several economists have hailed Georgescu-Roegen as a man who lived ahead of his time, and his magnum opus was acclaimed by one of his closest peers as 'a landmark' in economics.^{[1]:79 [2]:147} Historians of economic thought have proudly proclaimed that the man's work has 'heralded a conceptual overturn' in economics, and that the man himself was the most 'able and imaginative' economist of the 20th century.^{[3]:1 [4]:102} In spite of candid appreciation such as this, Georgescu-Roegen was never awarded the Nobel Prize in Economics, although benefactors from his native Romania were active lobbying in his support in order to have him win it.^[5]:270f After Georgescu-Roegen's death, his work was praised by a surviving friend of the highest rank: Prominent Keynesian economist, economics textbook author and Nobel Prize laureate Paul Samuelson stated that he would be delighted if the fame Georgescu-Roegen did not fully realise in his own lifetime would be granted by posterity instead.^[6]:xvii

In the history of economic thought, Georgescu-Roegen was the first economist of some standing to theorise on the premise that all of Earth's mineral resources will eventually be exhausted at some point.^{[2]:165 [3]:160–171} In his magnum opus, Georgescu-Roegen argues that economic scarcity is rooted in physical reality; that all natural resources are irreversibly degraded when put to use in economic activity; that the carrying capacity of Earth — that is, Earth's capacity to sustain human populations and consumption levels — is bound to decrease sometime in the future as Earth's finite stock of mineral resources is presently being extracted and put to use; and consequently, that the world economy as a whole is heading towards an inevitable future collapse.^[7] Due to the pessimism inherent in his work, based on the physical concept of entropy, the theoretical position of Georgescu-Roegen and his followers was later termed 'entropy pessimism' by one of his peers.^[8]:116

As he brought natural resource flows into economic modelling and analysis, Georgescu-Roegen's work was seminal in establishing ecological economics as an independent academic subdiscipline in economics in the 1980s.^{[9]:149 [10]:65–68 [11]:422 [12]:302f} Also, the degrowth movement that formed in France and Italy in the early 2000s recognises Georgescu-Roegen as the main intellectual figure inspiring their movement.^{[13]:548f [14]:1742 [15]:xi} In effect, by the 2010s Georgescu-Roegen has educated, influenced and inspired at least three generations of economists, including his own contemporary peers, younger ecological economists, still younger degrowth theorists and activists, and others around the world.

In the 1980s, Georgescu-Roegen's work was popularised and promoted by trendspotter and political advisor Jeremy Rifkin in his controversial and widely publicised book on Entropy: A New World View.^[16]

The inability or reluctance of most mainstream economists to recognise Georgescu-Roegen's work has been ascribed to the fact that much of his work reads like applied physics rather than economics, as this latter subject is generally taught and understood today.^{[17]:71 [18]:112 [19]:106–109}

Georgescu-Roegen's work was marred somewhat by mistakes caused by his insufficient understanding of the physical science of thermodynamics. These mistakes have since generated some controversy, involving both physicists and ecological economists.^{[20]:21–28 [21][22]:56f [23]:1215–1218}

Early in his life, Georgescu-Roegen was the student and mentee of Joseph Schumpeter, who taught that irreversible evolutionary change and 'creative destruction' are inherent in capitalism.^[24]:138f Later in his life, Georgescu-Roegen was the teacher and mentor of Herman Daly, who since developed the concept of a steady-state economy to put permanent government restrictions on the flow of natural resources through the (world) economy.^[25]

In 2012, two awards in honour of Georgescu-Roegen's life and work were established by The Energy and Resources Institute in New Delhi, India: The Georgescu-Roegen Annual Awards. Japanese ecological economist Kozo Mayumi, a student of Georgescu-Roegen in the 1980s, was the first scholar to receive the award in the 'unconventional thinking' category.^[26]:41–44

Life and career

The life of Nicholas Georgescu-Roegen (born Nicolae Georgescu) spanned most of the 20th century, from 1906 to 1994. In his native Romania, he lived through two world wars and three dictatorships. Living in exile in the US in the second part of his life, he witnessed at a distance the rise and fall of communism in Romania. He made many important contributions to mainstream neoclassical economics before he finally turned against it and published his paradigmatic magnum opus on The Entropy Law and the Economic Process. Although this opus was seminal in establishing ecological economics as an independent academic subdiscipline in economics, Georgescu-Roegen died disappointed and bitter that his paradigmatic work did not receive the appreciation he had expected for it in his own lifetime.

Childhood, adolescence and education

Nicolae Georgescu was born in Constanţa, Romania in 1906 in a family of simple origins. His father, of Greek descent, was an army officer. His mother, an ethnic Romanian, was a sewing teacher at a girls' school. The father spent time teaching his son how to read, write and calculate, and planted in the boy the seed of intellectual curiosity. By her living example, the mother taught her son the value of hard work. After having lost his position in the army for disciplinary reasons, the father died when Nicolae was only eight years old.^{[7]:xiv [27][28]:1–3}

City of Constanţa in 1909.

Constanţa was then a small Black Sea port with some 25,000 inhabitants, and the mixture of various cultures and ethnic groups in the town shaped young Nicolae's cosmopolitan spirit. In primary school, Nicolae excelled at mathematics, and he was encouraged by one of his teachers to apply for a scholarship at a secondary school, the Lyceum Mânăstirea Dealu ('Lycée of the Monastery of the Hill'), a new prestigious military prep school in the town. Nicolae won a scholarship there in 1916, but his attendance was delayed by Romania's entry into World War I. His widowed mother fled with the family to Bucharest, the country's capital, where they stayed with Nicolae's maternal grandmother during the rest of the war. In these times of hardship, Nicolae had traumatic boyhood experiences of the agonies of war. He wanted to become a mathematics teacher, but he could barely keep up his studies.^{[18]:9–11 [29]:16–20 [15]:1–3}

After the war, young Nicolae returned to his home town and started attending the lyceum. Teaching standards were high, and many of the teachers later went on to become university professors; but the discipline was regimented, with mock-military physical exercises and wearing uniforms. Students were not permitted to leave the school at all, except in summer and briefly during Christmas and Easter. Nicolae proved to be an excellent student, especially in mathematics. He later credited the five years of secondary education he received at the lyceum for providing him with an extraordinary education that would serve him well later on in his career; but he also blamed the discipline and the monastic isolation of the place for having stunted his social abilities, something that would put him at odds with acquaintances and colleagues throughout his life.

At the lyceum, it turned out that Nicolae Georgescu had a namesake. In order to avoid any confusion, he decided to create an addendum to his second name, made up of the first and the last letter of his first name, plus the first four letters of his last name, all six letters put in the reverse order: NicolaE GEORgescu → '-Roegen'. Georgescu-Roegen would retain this addendum for the rest of his life. Later in his life, he also changed his first name to its French and English form, 'Nicholas'.

Editors note: For improved readability of the text and better use of space, Nicholas Georgescu-Roegen will be referred to simply as 'Georgescu' in the remainder of this article.

University of Bucharest around 1921.

Georgescu received his diploma from the lyceum in 1923. Thanks to a scholarship awarded to children from poor families, he was soon after accepted at the University of Bucharest for further studies in mathematics. The curriculum there was conventional, and the teaching methods were much the same as those that had prevailed at the lyceum. At the university, he met the woman who would later become his wife for the rest of his life, Otilia Busuioc. To sustain himself during his studies, he gave private lessons and taught in a grammar school outside the city. After his graduation cum laude in 1926, he took the examination to qualify as a secondary school teacher and then accepted a teaching post for another year in his former lyceum in Constanţa.

At the university, Georgescu made a closer acquaintance with one of his professors, Traian Lalescu, a renowned mathematician of the day who had taken a special interest in applying mathematical methods to economic reality by means of statistics. Lalescu was concerned with the lack of adequate data needed to analyse Romania's economic problems, so he encouraged Georgescu to pursue this new line of research in further studies abroad. In 1927, Georgescu went to France to study at the Institute de Statistique, Sorbonne in Paris.

Studying in Paris and London

Georgescu's stay in Paris broadened his field of study well beyond pure mathematics. Not only did he attend the lectures of the best statistics and economics professors in France, he also immersed himself in the philosophy of science, especially the works of Blaise Pascal, Ernst Mach and Henri Bergson. Outside of the study chamber, life was not easy for a poor foreign student in a great city. The meager means he received from Romania could hardly support even his most basic necessities, and the native French students habitually referred to all foreign students by the derogatory term métèques, 'strangers'. But the studying progressed splendidly: In 1930, Georgescu defended his doctoral dissertation on how to discover the cyclical components of a phenomenon with extraordinary honour. Émile Borel, one of Georgescu's professors, thought so highly of the dissertation that he had it published in full as a special issue of a French academic journal.^{[18]:11f [30]:129f [15]:3–5 [29]:20–23}

While studying in Paris, Georgescu learned of the work of Karl Pearson at the University College in London. Pearson was a leading English scholar of the time, with a field of interests that coincided with Georgescu's own, namely mathematics, statistics and philosophy of science. Georgescu made arrangements to lodge with the family of a young Englishman he had met in Paris and left for England in 1931. During his stay in London, the hosting family not only accepted Georgescu as their paying guest, they also taught him the basics of the English language, preparing him for his studies in the country.

Pearson's field of interests coincided with Georgescu's own.

When he approached Pearson and the English university system, Georgescu was amazed with the informality and openness he found. There was no more feeling like a métèque, a stranger. Studying with Pearson for the next two years and reading Pearson's work on the philosophy of science, titled The Grammar of Science, further shaped Georgescu's scientific methodology and philosophy. The two men even made a friendship, and Pearson encouraged Georgescu to carry on with his studies in mathematical statistics. They co-pioneered research on the so-called 'problem of moments', one of the most difficult topics in statistics at the time, but neither of them were able to solve the problem. This was a great disappointment to Pearson, but Georgescu was pleased about experiencing their joint effort nonetheless.

While studying in London, Georgescu was contacted by a representative of the Rockefeller Foundation in the US. Due to his past academic achievements, the Foundation wanted to grant Georgescu a research fellowship in their country. Georgescu had earlier learned of the use of time series analyses by the then famous Harvard Economic Barometer at the prestigious Harvard University, so he accepted the grant. The trip was put off for about a year, however, as he had more pressing obligations in Romania: He needed to conclude his first national editorial project, a 500 pages long manual on Metoda Statistică, and he had to pay some attention to his old widowed mother who was in a bad state of health.

Trip to the United States, meeting Schumpeter

In autumn 1934, Georgescu went to the New World; but upon arriving at Harvard University, he learned that the Economic Barometer had been shut down years ago: The project had completely failed to predict the Wall Street Crash of 1929, and was soon abandoned altogether. After several failed attempts to find another sponsor for his research, Georgescu finally managed to set up a meeting with the professor at the university teaching business cycles to see if there were any other opportunities available for him. This professor happened to be Joseph Schumpeter.^{[18]:11–13 [28]:3–5 [15]:5–8 [29]:22–24}

Schumpeter became the teacher and mentor of Georgescu at Harvard.

Meeting Schumpeter at this point completely changed the direction of Georgescu's life and career. Schumpeter warmly welcomed Georgescu to Harvard, and soon introduced him to the now famous 'circle', one of the most remarkable groups of economists ever working at the same institution, including Wassily Leontief, Oskar Lange, Fritz Machlup and Nicholas Kaldor, among others. Georgescu was now situated in a stimulating intellectual environment with weekly evening gatherings and informal academic discussions, where Schumpeter himself presided as the 'ringmaster' of the circle. In Schumpeter, Georgescu had found a competent and sympathetic mentor. Although Georgescu never formally enrolled in any economics classes, this was how he became an economist: "Schumpeter turned me into an economist... My only degree in economics is from Universitas Schumpeteriana".^[30]:130

While at Harvard, Georgescu published four important papers, laying the foundations for his later theories of production and of consumer preferences. The scholarly quality of these articles impressed Schumpeter.

There was more to the US than merely Harvard University, even for Georgescu. He managed to obtain a modest stipend for himself and his wife Otilia, enabling them to travel about the country, journeying as far as California. Through Schumpeter's contacts, Georgescu also had the opportunity of speaking with notable economists of the day such as Harold Hotelling and Irving Fisher. To top it all, he met Albert Einstein at Princeton University.

During the stay, Georgescu's relationship with Schumpeter developed. Realising that Georgescu was a promising young scholar, Schumpeter wanted to keep him at Harvard. He offered Georgescu a position with the economics faculty, and asked him to work with him on an economics treatise as a joint effort; but Georgescu declined: He wanted to go back to Romania in order to serve his backward homeland that had sponsored most of his education already; besides, his return was expected at home. Later in his life, Georgescu would regret having turned down Schumpeter's generous offer at this point in his career.^{[15]:7f [30]:132}

In spring 1936, Georgescu left the US. His voyage back to Romania came to last almost a year in itself, as he paid a long visit to Friedrich von Hayek and John Hicks at the London School of Economics on the way home. He was in no hurry to return.

The Romanian 'exile' and the flight from there

From 1937 to 1948, Georgescu lived in Romania, witnessing all the turmoils and excesses of World War II and the subsequent rise to power of the communists in the country. During the war, Georgescu lost his only brother due to the fatal reaction to a vaccine against tuberculosis.^{[18]:13f [28]:5–7 [15]:8–10}

Upon his return from the US to Bucharest, Georgescu was soon appointed to several government posts. His doctoral dissertation from Sorbonne as well as his other academic credentials earned him a respectable reputation everywhere, and his fine French and English skills were needed in the foreign affairs department. He became vice-director of the Central Statistical Institute, responsible for compiling data on the country's foreign trade on a daily basis; he also served on the National Board of Trade, settling commercial agreements with the major foreign powers; he even participated in the diplomatic negotiations concerning the reassignment of Romania's national borders with Hungary.

Georgescu engaged himself in politics, joining the pro-monarchy National Peasants' Party. The country's economy was still underdeveloped and had a large agrarian base, where the mass of the peasantry lived in backwardness and poverty. Substantial land reforms were called for if the most appalling inequalities between the rural and the urban parts of the population were to be evened out. Georgescu put a persuasive effort into this work and was soon elevated to the higher ranks of the party, becoming member of the party's National Council.

Georgescu did only little academic work during this period of his life. Apart from co-editing the national encyclopedia, the Enciclopedia României, and reporting on the country's economic situation by some minor statistics publications, he published nothing of scholarly significance. Although he did reside in his native country, Georgescu would later refer to this period of his life as his Romanian 'exile': The exile was an intellectual one for him.

During most of the war, Romania was an Axis power allied with Nazi Germany '... against Bolshevism'.

By the end of the war, Romania was occupied by the Soviet Union. A trusted government official and a leading member of the Peasants' Party, Georgescu was appointed general secretary of the Armistice Commission, responsible for negotiating the conditions for peace with the occupying power. The negotiations dragged out for half a year, involving long and stressful discussions: During most of the war, Romania had been an Axis power allied with Nazi Germany, so the Soviet representatives treated the Commission as nothing but a vehicle for levying the largest possible amount of war reparations on the Romanian people.

As the communists rose to power, the leading members of the National Peasants' Party were round up and put on show trial in 1947. Many were sentenced to life imprisonment.

After the war, the political forces in the country began encroaching upon Georgescu. Before and during the war, Romania had already passed through three successive dictatorships, and the fourth one was now at hand. Plenty of items on Georgescu's track record were suitable for antagonising both the native Romanian communists and the Soviet authorities that still occupied the country: His top membership of the Peasants' Party, in open opposition to the Communist Party; his chief negotiating position in the Armistice Commission, defending Romania's sovereignty; and his earlier affiliation with capitalist US as a Rockefeller research fellow at Harvard. Political repression in the country intensified as the rise to power of the communists was completing, and Georgescu finally realised it was time to get away: "... I had to flee Romania before I was thrown into a jail from which no one has ever come out alive."^[30]:133 By the aid of the Jewish community — he had earlier risked his neck by helping the Jews during the Romanian part of the Holocaust — Georgescu and his wife got hold of counterfeit identity cards that secured them the passage out of the country, surrounded by bribed smugglers and stowed away in the hold of a freight ship heading for Turkey.

Having visited Turkey before on official business, Georgescu was able to use his contacts there to notify Schumpeter and Leontief at Harvard University about his flight. Leontief offered Georgescu a position at Harvard, and made the necessary arrangements for the couple in advance of their arrival there.

Settling in the United States, years at Vanderbilt University

After an exhausting journey from Turkey through war-torn continental Europe, Georgescu and his wife reached Cherbourg in France, from where they could cross the Atlantic by ship. Georgescu's arrival at Harvard in summer 1948 was something of a return for him there. Only now, the circumstances were very different than in the 30s: He was no longer a promising young scholar on a trip abroad, supported and sponsored by his native country; instead, he was a middle-aged political refugee who had fled a communist dictatorship behind the Iron Curtain; but he was welcomed at Harvard just the same, obtaining employment as a lecturer and research associate, collaborating with Wassily Leontief on the Harvard Economic Research Project and other subjects. This was not a permanent employment, though.^{[18]:14–18 [29]:24–27}

While working at Harvard, Georgescu was approached by Vanderbilt University, who offered him a permanent academic chair as economics professor. Georgescu accepted the offer and moved to Vanderbilt in Nashville, Tennessee in 1949. It has been argued that Georgescu's decision to move from Harvard to the permanence and stability of the less prestigious Vanderbilt was motivated by his precarious wartime experiences and his feeling of insecurity as a political refugee in his new country.^[18]:14f It has also been argued that Joseph Schumpeter had at this point lost most of his former influence that could have secured his once mentee Georgescu a permanent position at Harvard (Schumpeter died in 1950).^[15]:11 Georgescu remained at Vanderbilt until his retirement in 1976 at age 70. Except for short trips, he would never leave Nashville again.

Vanderbilt University.

During his years at Vanderbilt University, Georgescu pursued an impressive academic career. He held numerous visiting appointments and research fellowships across the continents, and served as editor of a range of academic journals, including the Econometrica. He received several academic honours, including the distinguished Harvie Branscomb Award, presented in 1967 by his employer, Vanderbilt University. In 1971, the very same year his magnum opus was published, he was honoured as Distinguished Fellow of the American Economic Association.^[18]:16

In the early 60s, Georgescu had Herman Daly as his student and mentee.^[12]:305 Daly later went on to become a prominent ecological economist and the economists profession's most faithful, persistent and influential proponent of the economics of Georgescu.^{[9][25]:7–12[31][32][33]:61–76} However, Georgescu on his part would later turn critical of his student's work (see below).

The publication of Georgescu's magnum opus in 1971 did not trigger any immediate debates in the mainstream of the economics profession, and the only review in a leading mainstream journal warned the readers against the 'incorrect statements and philosophical generalisations' made by the author; but Georgescu did receive four favourable reviews from heterodox, evolutionary economists.^[34]:2274

Meadows was the director of the Club of Rome project at MIT in 1970-72.

In the 1970s, Georgescu had a short-lived cooperation with the Club of Rome. Whereas Georgescu's own magnum opus went largely unnoticed by mainstream (neoclassical) economists, the report on The Limits to Growth, published in 1972 by the Club of Rome, created something of a stir in the economics profession.^[35] In the heated controversies that followed the report, Georgescu found himself largely on the same side as the Club, and opposed to the mainstream economists. Teaming up with a natural ally, he approached the Club and became a member there. Georgescu's theoretical work came to influence the Club substantially. One other important result of the cooperation was the publication of the polemical article on Energy and Economic Myths, where Georgescu took issue with the mainstream economists and various other debaters.^[36] This article found a large audience through the 70s. Later, the cooperation with the Club waned: Georgescu reproached the Club for not adopting a clear anti-growth stance; he was also sceptical of the Club's elitist and technocratic fashion of monitoring and managing global social reality by building numerous abstract computer simulations of the world economy, and then publish all the findings to the general public. In the early 80s, the parties finally split up.^[15]:33f[34]

Throughout the years at Vanderbilt, Georgescu remained a solitary man. He rarely discussed his ongoing work with colleagues and students, and he collaborated in very few joint projects during his career. In addition, several independent sources confirm the fact that Georgescu's uncompromising personality and bad temper made him a rather unpleasant acquaintance to deal with. His blunt and demanding behaviour tended to offend most people in academia and elsewhere, thereby undermining his influence and standing.^{[18]:16–18 [31]:126f [6]:xvii [12]:310f [29][34]}

On Georgescu's formal retirement in 1976, a symposium in his honour was organised by three of his colleagues at Vanderbilt, and the papers presented there were later published as an anthology.^[37] No fewer than four Nobel Prize laureates were among the contributing economists;^[9]:150 but none of the colleagues from Georgescu's department at Vanderbilt participated, a fact that has been taken as evidence of his social and academic isolation at the place.^[29]:14f

Retirement, later years and death

After Georgescu's formal retirement from Vanderbilt in 1976, he continued to live and work as an emeritus in his home in Nashville until his death in 1994. Through these later years, he wrote several articles and papers, expanding on and developing his views.^{[38][39][40][41][42]} He also corresponded extensively with his friends and former colleagues.^{[15]:222–241}

In 1988, Georgescu was invited to join the editorial board of the newly established academic journal Ecological Economics, published by the International Society for Ecological Economics; but although most of the people organising the journal and the society recognised and admired Georgescu's work, he turned down the invitation: He regarded both the journal and the society as nothing but vehicles for promoting concepts like sustainable development and steady-state economics, concepts he himself dismissed as misdirected and wrong (see below, both here and here).^{[15]:41–48 [34]:2271}

Georgescu lived long enough to survive the communist dictatorship in Romania he had fled earlier in his life (see above), and he even received some late recognition from his fatherland: Following the fall of the Berlin Wall and the subsequent Romanian Revolution in 1989, Georgescu was elected to the Romanian Academy in Bucharest. He was pleased about this election.^[18]:16

His last years were marked by seclusion and withdrawal from the world. By now, Georgescu was an old man. Although he had a productive and successful academic career behind him, he was disappointed that his work had not received the dissemination and recognition he had expected for it in his own lifetime. He believed he had long been running against a current.^{[30]:154–159} He came to realise that he had failed in warning the general public and changing people's minds about the world's looming mineral resource exhaustion he himself was very concerned about.^{[43]:163–170} Yet, in spite of his disappointment and frustration, he continued to write down and propagate his views as long as he was physically able to do so.^[1]:79

By the end, his health deteriorated. He was becoming rather deaf, and complications caused by his diabetes rendered him unable to walk stairs. In his final years, he isolated himself completely. He cut off all human contact, even to those of his former colleagues and students who appreciated his contribution to economics. He died bitter and (almost) lonely in his home at the age of 88. His wife Otilia survived him by some four years. The couple had no children.^{[9]:154 [18]:18 [15]:37}

In his obituary essay on Georgescu, Herman Daly wrote admirably of his deceased teacher and mentor, concluding that "He demanded a lot, but he gave more".^[9]:154

Work

In his work as an economist, Georgescu was influenced by the philosophy of Ernst Mach and the later school of logical positivism derived from Mach. Georgescu found that two of his other main sources of inspiration, namely Karl Pearson and Albert Einstein, also had a largely Machian outlook. "My philosophy is in spirit Machian: it is ... mainly [concerned] with the problem of valid analytical representations of the relations among facts."^[30]:129f Much of his criticism of both neoclassical economics and of Marxism was based on this outlook.^[18]:40

Arriving in the US after World War II, Georgescu's background soon put him at odds with the dominant theoretical school of neoclassical economics. Having lived in Romania, an underdeveloped and peasant-dominated economy, he realised that neoclassical economics could explain only those social conditions that prevailed in advanced capitalist economies, but not in other institutional settings. He was also critical of the increasing use of abstract algebraic formalism grounded in no facts of social reality. Both of these issues made him attentive to social phenomena that were either ignored or misrepresented by ordinary economic analysis.^{[30]:129f [34]:2273}

It has been argued that an unbroken path runs from Georgescu's work in pure theory in the early years, through his writings on peasant economies in the 60s, leading to his preoccupation with entropy and bioeconomics in the last 25 years of his life.^[24]:137f

Magnum opus on The Entropy Law and the Economic Process

According to Georgescu's own recollection, the ideas presented in his magnum opus were worked out in his mind over a period of twenty years or so before the final publication.^[7]:xiv The three most important sources of inspiration for his work were Émile Borel's monograph on thermodynamics he had read while studying in Paris (see above); Joseph Schumpeter's view that irreversible evolutionary change are inherent in capitalism; and the Romanian historical record of the large oil refineries in Ploieşti becoming target of strategic military attacks in both world wars, proving the importance of natural resources in social conflict.^{[30]:146, 153 [43]:161f [24]:139f [42]:185f, 196f [28]:6}

The shortcomings of both neoclassical economics and of Marxism

Georgescu outlines that both main streams of economic thought having dominated the world since the end of the 19th century — namely neoclassical economics and Marxism — share the shortcoming of not taking into account the importance of natural resources in man's economy.^[7]:2 Hence, Georgescu engages himself in an intellectual battle with two fronts.

The relevance of thermodynamics to economics

The physical theory of thermodynamics is based on two laws: The first law states that energy is neither created nor destroyed in any isolated system (a conservation principle). The second law of thermodynamics — also known as the entropy law — states that energy tends to be degraded to ever poorer qualities (a degradation principle).

Georgescu argues that the relevance of thermodynamics to economics stems from the physical fact that man can neither create nor destroy matter or energy, only transform it. The usual economic terms of 'production' and 'consumption' are mere verbal conventions that tend to obscure that nothing is created and nothing is destroyed in the economic process — things are only being transformed.^[7]:280

Conceptions of scarcity

Introducing the term 'low entropy' for valuable natural resources, and the term 'high entropy' for valueless waste and pollution, Georgescu explains that all the economic process does from a physical point of view is to irreversibly transform low entropy into high entropy, thereby providing a flow of natural resources for people to live on. The irreversibility of this economic process is the reason why natural resources are scarce: In many cases, it is possible to recycle material resources, but only by using up some energy resources plus an additional amount of material resources; and energy resources, in turn, cannot be recycled at all (according to the entropy law).^{[7]:277–282}

The sun will continue to shine on Earth for billions of years to come.

Georgescu points out that Earth is a closed system in the thermodynamic sense of the term: Earth exchanges energy, but not matter (practically) with the rest of the universe. Hence, mainly two sources of 'low entropy' are available to man, namely the stock of mineral resources in the crust of the Earth; and the flow of radiation, received from the Sun. Since the Sun will continue to shine for billions of years to come, the Earth's mineral stock is the scarcer one of these two main sources of low entropy. Whereas the stock of minerals may be extracted from the crust of the Earth at a rate of our own choosing (practically), the flow of solar radiation arrives at the surface of the Earth at a constant and fixed rate, beyond human control. This natural 'asymmetry' between man's access to the stock of minerals and the flow of solar energy accounts for the historical contrast between urban and rural life: The busy urban life, on the one hand, is associated with industry and the impatient extraction of minerals; the tranquil rural life, on the other hand, is associated with agriculture and the patient reception of the fixed flow of solar energy. Georgescu points out that this 'asymmetry' helps explaining the historical subjection of the countryside by the town since the dawn of civilisation, and he criticises Karl Marx for not taking this subjection properly into account in his theory of historical materialism.^[7]:313

Modern mechanised agriculture relies heavily on mineral inputs.

Georgescu explains that modern mechanised agriculture has developed historically as a result of the growing pressure of population on arable land; but the relief of this pressure by means of mechanisation has only substituted a scarcer source of input for the more abundant input of solar radiation: Machinery, chemical fertilisers and pesticides all rely on mineral resources for their operation, rendering modern agriculture — and the industrialised food processing and distribution systems associated with it — almost as dependent on Earth's mineral stock as the industrial sector has always been. Georgescu cautions that this situation is a major reason why the carrying capacity of Earth is decreasing.^{[7]:303 [16]:136–140 [2]:163f [3]:20–44 [44]:10f} In effect, overpopulation on Earth is largely a dynamic long run phenomenon, being a by-product of ever more constraining mineral scarcities.^{[7]:20f [45]:32–34}

The flow-fund model of production

Georgescu's model of the economy grew out of his dissatisfaction with neoclassical production theory as well as the input-output model of the economy, developed by Nobel Prize laureate Wassily Leontief. Georgescu realised that production cannot be adequately described by stocks of equipment and inventories only; or by flows of inputs and outputs only. It was necessary to combine these two descriptions. In order to complete the picture, it was also necessary to add the new concept of a 'fund'.^{[18]:65–71 [24]:147–149 [33]:70–72 [46]:106–109}

In Georgescu's flow-fund model of production, a 'fund' factor is either labour power, farm land or man-made capital providing a useful service at any point in time; a 'stock' factor is a material or energy input that can be decumulated at will; and a 'flow' factor is a stock spread out over a period of time. The fund factors constitute the agents of the economic process, and the flow factors are used or acted upon by these agents. Unlike a stock factor, a fund factor cannot be utilised (decumulated) at will, as its rate of utilisation depends on the distinct physical properties of the fund (labour power and farm land, for instance, may run the risk of overutilisation and exhaustion if proper care is not taken).

Natural resources flow through the economy and end up as waste and pollution.

Contrary to neoclassical production theory, Georgescu identifies nature as the exclusive primary source of all factors of production. According to the first law of thermodynamics, matter and energy is neither created nor destroyed in the economy (the conservation principle). According to the second law of thermodynamics — the entropy law — what happens in the economy is that all matter and energy is transformed from states available for human purposes to states unavailable for human purposes (the degradation principle). This transformation constitutes a unidirectional and irreversible process. Consequently, valuable natural resources ('low entropy') are procured by the input end of the economy; the resources flow through the economy, being transformed and manufactured into goods along the way; and unvaluable waste and pollution ('high entropy') eventually accumulate by the output end. Mankind lives in, by and of nature, and we return our residues to nature. By so doing, the entropy of the combined nature-economy system steadily increases.

The presence of natural resource flows in Georgescu's production model differentiates the model from those of both Keynesian macroeconomics, neoclassical economics, as well as classical economics, including most — though not all — variants of Marxism.^{[note 1]} Only in ecological economics are natural resource flows positively recognised as a valid theoretical basis for economic modelling and analysis.^{[3]:1–3 [10]:57–62 [5]:266–268}

Later, Georgescu's production model formed the basis of his criticism of neoclassical economics (see below).

Man's economic struggle (bioeconomics)

Unlike the animals, man has developed exosomatic instruments with which he manipulates his surroundings.

In his social theory, Georgescu argues that man's economic struggle to work and earn a livelihood is largely a continuation and extension of his biological struggle to sustain life and survive. This biological struggle has prevailed since the dawn of man, and the nature of the struggle was not altered by the invention of money as a medium of exchange. Unlike the animals, man has developed exosomatic instruments, that is, tools and equipment. These instruments are produced by man and are not a part of his body. At the same time, production is a social, and not an individual, undertaking. This situation has turned man's struggle to sustain life and survive into a social conflict which is unique when compared to the animals. Contrasting his own view with those of Karl Marx, Georgescu asserts:

“

[L]ike Marx, I believe that the social conflict is not a mere creation of man without any root in material human conditions. But unlike Marx, I consider that, precisely because the conflict has such a basis, it can be eliminated neither by man's decision to do so nor by the social evolution of mankind.[7]^:306

”

When man (some men) attempts to radically change the distribution of access to material resources in society, this may result in wars or revolutions, Georgescu admits; but even though wars and revolutions may bring about the intended redistributions, man's economic struggle and the social conflict will remain. There will be rulers and ruled in any social order, and the ruling is largely a continuation of the biological struggle of sustaining life and survive, Georgescu claims. Under these material conditions, the ruling classes of past and present have always resorted to force, ideology and manipulation to defend their privileges and maintain the acquiescence of the ruled. This historical fact does not end with communism, Georgescu points out; quite the contrary, it goes on during communism, and beyond it as well. It would be against man's biological nature to organise himself otherwise.^{[7]:306–315 [18]:120–124}

Later, Georgescu introduced the term 'bioeconomics' (short for 'biological economics') to describe his view that man's economic struggle is a continuation of the biological struggle.^{[30]:152–154 [36]:369 [22]:1f [24]:149} In his final years, he planned to write a book on the subject of bioeconomics, but due to old age, he was unable to complete it.^[18]:120 He did write a sketch on it, though.^[39]

Population pressure and exhausted mineral resources

Georgescu argues that the carrying capacity of Earth — that is, Earth's capacity to sustain human populations and consumption levels — will decrease sometime in the future as Earth's finite stock of mineral resources is being extracted and put to use. Consequently, the present trends of an ever growing world population and an ever growing rate of extraction of mineral resources cannot be expected to continue for long. A major collapse in the world economy is inevitable in the not-too-distant future, Georgescu warns.^[7]:304

Work after magnum opus

In the years after the publication of his magnum opus in 1971 and until his death in 1994, Georgescu published a number of articles and essays where he further expanded on and developed his views.^{[note 2]}

Criticising neoclassical economics (weak versus strong sustainability)

Criticising neoclassical economics, Georgescu argues that neoclassical production theory is false when representing the economy as a mechanical, circular and closed system, with no inlets and no outlets.^[36]:347f A misrepresentation such as this fails to take into account the exhaustion of mineral resources at the input end, and the building up of waste and pollution at the output end. In Georgescu's view, the economy is represented more accurately by his own flow-fund model of production (see above).

Solow is a leading growth theorist in the neoclassical tradition.

In addition, Georgescu finds that neoclassical economics tends to ignore, or, at best, to misrepresent the problem of how to distribute the exhaustible mineral resources between present and future generations. Georgescu points out that the market mechanisms of supply and demand are systematically unable to take care of the intergenerational distribution problem properly, since future generations are not, and cannot be, present on today's market. This anomaly of the market mechanisms is described by Georgescu as 'a dictatorship of the present over the future'.^{[36]:375 [50]:105} On this issue, notable economists and Nobel Prize laureates Robert Solow and Joseph Stiglitz, Georgescu's two main adversaries in academia in the 1970s, have stated their account of the orthodox neoclassical approach to the economics of exhaustible resources: They both claim that across the board substitutability of man-made capital for natural capital is a true possibility. Hence, any concern with intergenerational distribution of the mineral stock should be relaxed somewhat (according to Solow);^[51]:366f or even ignored altogether (according to Stiglitz).^[52]:61f

The position of Solow and Stiglitz (as well as other, like-minded theorists in the neoclassical tradition) was later termed 'weak sustainability' by Kerry Turner.^[53]:9–13

It is physically impossible to transform energy into matter (mass), not even a nuclear reactor can accomplish that.

In response to the position of Solow and Stiglitz, Georgescu argues that neoclassical economists generally fail to realise the important difference between material resources and energy resources in the economic process. This is where his flow-fund model of production comes into play (see above). Georgescu's point is that only material resources can be transformed into man-made capital. Energy resources, on the other hand, cannot be so transformed, as it is physically impossible to turn energy into matter, and matter is what man-made capital is made up of physically. The only possible role to be performed by energy resources is to assist — usually as fuel or electricity — in the process of transforming material resources into man-made capital. In Georgescu's own terminology, energy may have the form of either a stock factor (mineral deposits in nature), or a flow factor (resources transformed in the economy); but never that of a fund factor (man-made capital in the economy). Hence, substituting man-made capital for energy resources is physically impossible.

Furthermore, not all material resources are transformed into man-made capital; instead, some material resources are manufactured directly into consumer goods with only limited durability. Finally, in the course of time, all man-made capital depreciates, wears out and needs replacement; but both old and new man-made capital is made out of material resources to begin with. All in all, the economic process is indeed a process with steadily increasing entropy, and the 'mechanical' notion of across the board substitutability prevalent in neoclassical economics is untenable, Georgescu submits.^{[36]:359–363 [50]:98 [31]:127–136}

Contrary to the neoclassical position, Georgescu argues that flow factors and fund factors (that is, natural resources and man-made capital) are essentially complementary, since both are needed in the economic process in order to have a working economy. Georgescu's conclusion, then, is that the distribution of exhaustible mineral resources between present and future generations is a large problem that cannot, and should not, be relaxed or ignored.

The position of Georgescu, including his criticism of neoclassical economics, was later termed 'strong sustainability' by Kerry Turner.^[53]:13–15 Later still, Turner's taxonomy of 'weak' and 'strong' sustainability was integrated into ecological economics.^{[32]:14–19 [54]:205–209 [8]:115f [55][56]} However, contrary to the current widespread use of Turner's taxonomy, Georgescu certainly did not term his own position 'strong sustainability' or any other variant of sustainability. Quite the opposite. Georgescu flatly dismissed any notion of sustainable development as only so much 'snake oil' intended to deceive the general public.^[24]:153 In his last years, he even denounced the notion bitterly as 'one of the most toxic recipes for mankind': There can be no such thing as a 'sustainable' rate of extraction and use of a finite stock of non-renewable mineral resources — any rate will diminish the remaining stock itself.^[15]:42

Criticising Daly's steady-state economics

Prominent ecological economist and steady-state theorist Herman Daly is a former student and mentee of Georgescu. In the 1970s, Daly developed the concept of a steady-state economy, by which he understands an economy made up of a constant stock of physical wealth (man-made capital) and a constant stock of people (population), both stocks to be maintained by a minimal flow of natural resources (or 'throughput', as he terms it). Daly argues that this steady-state economy is both necessary and desirable in order to keep human environmental impact within biophysical limits (however defined), and to create more distributional fairness between present and future generations with regard to mineral resource use.^[25] In several articles, Georgescu criticised his student's concept of a steady-state economy.^{[36]:366–369 [38]:270 [43]:167f [50]:102–105 [13]:547 [42]:194 [57]:140–148}

Mining activities are subject to diminishing returns.

Georgescu argues that Daly's steady-state economy will provide no ecological salvation for mankind, especially not in the longer run: Due to the geologic fact that mineral ores are deposited and concentrated very unevenly in the crust of the Earth, exploration and extraction of mineral resources will sooner or later be faced with the principle of diminishing returns, whereby extraction activities are pushed to still less accessible sites and still lower grades of ores. In the course of time, then, extraction costs and market prices of the incremental amount of resources will tend to increase. Eventually, all minerals will be exhausted, but the economic exhaustion will manifest itself long before the physical exhaustion provides the ultimate backstop for further activity: There will still be resources left in the crust, but the grade of these resources will remain below the critical cutoff grade; hence, continued extraction will no longer pay off, and the market for these resources will then collapse. This long-term dynamics works itself through any economic (sub-)system, regardless of the system's geographical location, its size and its state of development (whether a progressive, a steady or a declining state); and the entropy of the system will steadily increase. In effect, the arguments advanced by Daly in support of his steady-state economy apply with even greater force in support of a declining-state economy, Georgescu points out: When the general purpose is to ration mineral resource use for as long time into the future as possible, zero economic growth is more desirable than growth is, true; but negative growth is better still! In this context, Georgescu also criticises Daly for not specifying at what levels man-made capital and human population are to be kept constant in the steady-state.

Instead of Daly's steady-state economics, Georgescu proposed his own so-called 'minimal bioeconomic program', featuring restrictions even more severe than those propounded by Daly.^{[24]:150–153 [36]:374–379}

Herman Daly on his part has readily accepted his teacher's judgement on this subject matter: In order to compensate for the principle of diminishing returns in mineral resource extraction, an ever greater share of capital and labour in the economy will gradually have to be assigned to the mining sector, thereby distorting the initial structure of any steady-state system. Furthermore, the steady-state economy will serve only to postpone, and not to prevent, the inevitable mineral resource exhaustion anyway. "A steady-state economy cannot last forever, but neither can a growing economy, nor a declining economy", Daly concedes in his response to Georgescu's criticism. In the same turn, Daly confirms Georgescu's general argument that Earth's carrying capacity is decreasing as mankind is extracting the finite mineral stock.^{[25]:369–371}

Likewise, several other economists in the field besides Georgescu and Daly have agreed that a steady-state economy does not by itself constitute a long-term solution to the 'entropy problem' facing mankind.^{[2]:165–167 [45]:30–34 [1]:75f [58]:105–107 [59]:270 [44]:37}

Technology assessments

In his technology assessments, Georgescu puts thermodynamic principles to use in a wider historical context, including the future of mankind.^{[40]:1041–1055 [41]:14–18 [30]:149–152 [42]:195f [18]:124–126}

According to Georgescu's terminology, a technology is 'viable' only when it is able to return an energy surplus sufficiently large to maintain its own operation, plus some additional energy left over for other use. If this criterion is not met, the technology in question is only 'feasible' (if workable at all), but not 'viable'. Both viable and feasible technologies depend on a steady flow of natural resources for their operation.

Prometheus I: The mastering of fire in the Palaeolithic Era.

Georgescu argues that the first viable technology in the history of man was fire. By the control of fire, it was possible for man to burn a forest, or all forests. It was also possible to cook food and to obtain warmth and protection. Inspired by the ancient Greek myth of Prometheus, the Titan who stole fire from the gods and gave it to man, Georgescu terms fire 'The first Promethean recipe'. According to Georgescu, a later important Promethean recipe (technology) of the same (first) kind was animal husbandry, feeding on grass and other biomass (like fire does).

Prometheus II: The steam engine of the Industrial Revolution.

Much later in the history of man, the steam engine came about as the crucial Promethean recipe of the second kind, feeding on coal. With the invention of the steam engine, it was possible to drain the underground water flooding the mine shafts, and the mined coal could then be used as fuel for other steam engines in turn. This technology propelled the Industrial Revolution in Britain in the second half of the 18th century, whereby man's economy has been thrust into a long, never-to-return overshoot-and-collapse trajectory with regard to the Earth's mineral stock. Georgescu mentions the internal combustion engine and the nuclear fission reactor as other, later examples of Promethean recipes of the second kind, namely heat engines feeding on a mineral fuel (oil and uranium (plus thorium), respectively).

Prometheus III: Solar collectors returning a sufficiently large energy output.

By a Promethean recipe of the third kind, Georgescu understands a solar collector returning a net energy output sufficiently large to supply all the energy input needed to manufacture an additional solar collector of the same kind, thereby comprising a full serial reproduction with regard to solar energy only. The fact that solar collectors of various kinds had been in operation on a substantial scale for more than a century without providing a breakthrough in energy efficiency brought Georgescu to the conclusion that no Promethean recipe was yet around in the world in his day. Only feasible recipes for solar collectors were available, functioning like what he labelled 'parasites' with regard to the terrestrial inputs of energy for their manufacture and operation — and like any other parasite, these recipes cannot survive their host (the 'host' being the sources of the terrestrial inputs). Georgescu believed that for a coming solar economy on Earth to be truly energy self-supporting, a Promethean kind of solar collector had yet to be invented.^{[40]:1053–1055 [30]:151 [42]:196} Later, some scholars have argued that the efficiency of solar collectors has increased considerably since Georgescu made these assessments.^{[60]:479f [21]:176f}

Georgescu further points out that regardless of the efficiency of any particular kind of solar collector, the major drawback of solar power per se when compared to terrestrial fossil fuels and uranium (plus thorium) is the diffuse, low-intensity property of solar radiation. Hence, a lot of material equipment is needed as inputs at the surface of the Earth to collect, concentrate and (when convenient) store or transform the radiation before it can be put to use on a larger industrial scale. This necessary material equipment adds to the 'parasitical' operation of solar power, Georgescu assesses.^{[40]:1050 [16]:196–204 [54]:218f [44]:12f}

Assessing fusion power as a possible future source of energy, Georgescu ventured that, regarding magnetic confinement fusion, no reactor will ever be built to be large enough to effectively withstand and confine the thermal pressure of the plasmic deuterium-tritium fusion processes.^[42]:196 He did not assess the other one of the two major fusion power technologies being researched in his day (and still being researched), namely inertial confinement fusion.

Advancing into outer space...?

All of these technology assessments have to do with energy resources only, and not with material resources. Georgescu stressed the point that even with the proliferation of solar collectors throughout the globe, or the advent of fusion power, or both, any industrial economy will continue to depend on a steady flow of material resources, notably metals. He repeatedly argued his case that in the future, it will be scarcity of terrestrial material resources, and not of energy resources, that will prove to impose the most binding constraint on man's economy on Earth.^{[36]:377 [38]:268f [40]:1049 [50]:98f} As he held no space advocacy views, Georgescu failed to assess the (still) emerging technologies of asteroid mining or the various extensive schemes for settlements in outer space as potentials for compensating for this future scarcity constraint facing mankind: He was convinced that throughout its entire span of existence, our species will remain confined solely to Earth for all practical purposes.^[39]:103f His paradigmatic vision concluded thereby.

Mistakes and controversies

The entropy law does not apply to material resources.

Georgescu's work was blemished somewhat by mistakes caused by his insufficient understanding of the physical science of thermodynamics. While working on his magnum opus on The Entropy Law and the Economic Process (see above), Georgescu had the firm understanding that the entropy law applies equally well to both energy resources and material resources, and much of the reasoning in the opus rests on this understanding.^{[7]:277–282} But regrettably, this understanding was — and still is — false: In thermodynamics proper, the entropy law does apply to energy, but not to matter of macroscopic scale (that is, not to material resources).^{[61]:239–276 [19]:34–43} Later, when Georgescu realised his mistake, his reaction passed through several stages of contemplation and refinement, ultimately leading to his formulation of a new physical law, namely the fourth law of thermodynamics. This fourth law states that complete recycling of matter is impossible.^{[note 3]} The purpose of Georgescu's proposed fourth law was to substantiate his claim that not only energy resources, but also material resources, are subject to general and irreversible physical degradation when put to use in economic activity. In addition, he introduced the term 'material entropy' to describe this physical degradation of material resources.^[18]:104f

Planck had used the concept of 'matter dissipation' in some of his work.

Georgescu himself was not confident about this tentative solution to the problem. He remained embarrassed that he had misinterpreted, and consequently, overstretched the proper application of the physical law that formed part of the title of his magnum opus. He conceded that he had entered into the science of thermodynamics as something of a bold novice. Dedicated to transdisciplinarity, he was worried that physicists would dismiss all of his work as amateurism on this count. The predicament would trouble him for the rest of his life.^{[30]:148f [42]:196f [27]} In one of his last published articles before his death, Georgescu described his encouragement when he had once earlier come across the concept of 'matter dissipation' used by German physicist and Nobel Prize laureate Max Planck to account for the existence of irreversible physical processes where no simultaneous transformation of energy was taking place. Georgescu found comfort in the belief that the concept of 'matter dissipation' used by a physicist of Planck's authoritative standing would decisively substantiate his own fourth law and his own concept of material entropy.^{[42]:197 [22]:57–60}

Georgescu's formulation of a fourth law of thermodynamics and the concept of material entropy soon generated a prolonged controversy, involving both physicists and ecological economists;^{[62] [63] [18]:103–107 [20]:21–28 [64]:95–97 [21] [22]:56f [65]:25–29 [66] [67]:110 [68]:51 [23]:1215–1218} but some twelve to fifteen years after Georgescu's death, a consensus on this subject matter finally emerged along the following lines:

• There is only one measure of entropy in thermodynamics, and this one measure applies to both energy and to microscopic matter at the molecular level (kinetic gas theory); but it does not apply to macroscopic matter (matter in bulk, material resources), though it frequently appears so in the ecological economics literature and elsewhere.
• The general physical degradation of material resources taking place in the economy can neither be explained nor described by the entropy law (Georgescu's first mistake); but the fact remains that such physical degradation does take place all the time — continuously, irreversibly and in a variety of ways.
• The fourth law of thermodynamics and the concept of material entropy as proposed by Georgescu to redress his first mistake have no scientific basis in physics whatsoever, and it was a theoretical mistake by Georgescu to make these propositions at all (Georgescu's second mistake); but this does not imply that complete and perpetual recycling of material resources is possible, as it may be impossible on other grounds (see below).
• Both of Georgescu's mistakes were caused by his insufficient understanding of the physical science of thermodynamics. It is bad physics and equally bad economics to devise a new physical law (the fourth one) in order to make up for one's own insufficient understanding of a physical theory in the first place.
• Apart from these two mistakes, Georgescu's work is still compliant with the first and second law of thermodynamics as already established in physics.

In the same vein as this consensus, a full chapter on the economics of Georgescu has approvingly been included in one elementary physics textbook on the historical development of thermodynamics, and the details (Georgescu's mistakes) about the fourth law and material entropy are omitted there.^{[19]:95–112}

Ayres countered Georgescu's pessimism and argued in favour of a 'spaceship economy'.

Modelling a possible future economic system for mankind, Robert Ayres has countered Georgescu's position on the impossibility of complete and perpetual recycling of material resources. According to Ayres, it is possible to develop what he conceptualises as a 'spaceship economy' on Earth on a stable and permanent basis, provided that a sufficient flow of energy is available to support it (for example, by an ample supply of solar energy). In this spaceship economy, all waste materials will be temporarily discarded and stored in inactive reservoirs — or what he calls 'waste baskets' — before being recycled and returned to active use in the economic system at some later point in time. It will not be necessary, or even possible, for materials recycling to form its own separate and continuous flow to be of use — only, the waste baskets in question have to be large enough to compensate for the rate and the efficiency of the recycling effort. In effect, complete and perpetual recycling of material resources will be possible in a future spaceship economy of this kind specified, thereby rendering obsolete Georgescu's proposed fourth law of thermodynamics, Ayres submits.^[60] In a later article, Ayres restated his case for a spaceship economy.^{[69]:290–294}

In ecological economics, Ayres' contribution vis-à-vis Georgescu's proposed fourth law was since described as yet another instance of the so-called 'energetic dogma':^[13]:547 Earlier, Georgescu had attached the label 'energetic dogma' to various theorists holding the view that only energy resources, and not material resources, are the constraining factor in all economic activity.^{[40]:1024–1029 [54]:211f [note 4]} Ayres appears to be the odd man out on this subject matter: Whatever the scientific status of Georgescu's fourth law may be, several other economists in the field besides Georgescu deny the possibility of complete and perpetual recycling of all material resources in any type of economic system, regardless of the amount of energy, time and information to be assigned to the recycling effort.^{[25]:17f [16]:36f [2]:164–167 [53]:14 [58]:105–107 [70] [22]:60–64 [48]:155–161 [44]:292–294}

Prizes and awards

The Georgescu-Roegen Prize

Each year since 1987, the Georgescu-Roegen Prize has been awarded by the Southern Economic Association for the best academic article published in the Southern Economic Journal.^[71]

The Georgescu-Roegen Annual Awards

In 2012, two awards in honour of Georgescu's life and work were established by The Energy and Resources Institute in New Delhi, India: The Georgescu-Roegen Annual Awards. The awards were officially announced on Georgescu's 106th birth anniversary. The awards have two categories: The award for 'unconventional thinking' is presented for scholarly work in academia, and the award for 'bioeconomic practice' is presented for initiatives in politics, business and grassroot organisations.

Japanese ecological economist Kozo Mayumi, a student of Georgescu in 1984-88, was the first to receive the award in the 'unconventional thinking' category. Mayumi was awarded for his work on energy analysis and hierarchy theory.^[26]:41–44

Famous quotes

• "'Bigger and better' motorcycles, automobiles, jet planes, refrigerators, etc., necessarily cause not only 'bigger and better' depletion of natural resources, but also 'bigger and better' pollution."
• "William Petty was right in teaching that 'Nature is the mother and labour is the father of all wealth' — only, he should have said '... of our existence'."
• "In a different way than in the past, man will have to return to the idea that his existence is a free gift of the sun."

See also

• Ecological economics
• Degrowth
• Steady-state economy: Herman Daly's concept of it
• Sustainability: Carrying capacity
• Human overpopulation
• Peak minerals
• Energy returned on energy invested
• Sustainable development: Criticism of the concept
• Club of Rome
• The Energy and Resources Institute (TERI)
• Thermodynamics
• Entropy

Notes

1. Some Marxist scholars have made bold attempts at integrating Marxism and ecology.^[47][48][49]
2. A selection of these articles has been edited and republished by Italian degrowth theorist Mauro Bonaiuti, who also provides an introduction and an afterword.^[15]
3. The third law of thermodynamics states that the entropy of a system approaches a constant value as the temperature approaches zero. This third law was already established in physics when Georgescu realised his mistake about the second law (entropy law). Hence, Georgescu's numbered his new law as the fourth one in the line.
4. The subject of 'energetics' itself originated in the second half of the 19th century.

References

1. Miernyk, William H. (1999). "Economic growth theory and the Georgescu-Roegen paradigm". In Mayumi, Kozo; Gowdy, John M., eds. Bioeconomics and Sustainability: Essays in Honor of Nicholas Georgescu-Roegen. Cheltenham: Edward Elgar. ISBN 1858986672.
2. Boulding, Kenneth E. (1981). Evolutionary Economics. Beverly Hills: Sage Publications. ISBN 0803916485.
3. Martínez-Alier, Juan (1987). Ecological Economics: Energy, Environment and Society. Oxford: Basil Blackwell. ISBN 0631171460.
4. Mirowski, Philip (1992). "Nicholas Georgescu-Roegen". In Samuels, Warren J., ed. New Horizons in Economic Thought. Appraisals of Leading Economists. Cheltenham: Edward Elgar. ISBN 1852783796.
5. Røpke, Inge (2005). "Trends in the development of ecological economics from the late 1980s to the early 2000s" (PDF). Ecological Economics (Amsterdam: Elsevier) 55: 262–290. doi:10.1016/j.ecolecon.2004.10.010.
6. Samuelson, Paul A. (1999). "Foreword". In Mayumi, Kozo; Gowdy, John M., eds. Bioeconomics and Sustainability: Essays in Honor of Nicholas Georgescu-Roegen. Cheltenham: Edward Elgar. ISBN 1858986672.
7. Georgescu-Roegen, Nicholas (1971). The Entropy Law and the Economic Process. (PDF contains only the introductory chapter of the book). Cambridge, Massachusetts: Harvard University Press. ISBN 0674257804.
8. Ayres, Robert U. (2007). "On the practical limits to substitution" (PDF). Ecological Economics (Amsterdam: Elsevier) 61: 115–128. doi:10.1016/j.ecolecon.2006.02.011.
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15. Bonaiuti, Mauro, ed. (2011). From Bioeconomics to Degrowth: Georgescu-Roegen's "New Economics" in eight essays. (PDF contains only the first 16 pages of the introductory chapter of the book). London: Routledge. ISBN 0203830415.
16. Rifkin, Jeremy (1980). Entropy: A New World View. (PDF contains only the title and contents pages of the book). New York: The Viking Press. ISBN 0670297178.
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28. Mayumi, Kozo; Gowdy, John M. (1999). "Introduction: theory and reality — the life, work and thought of Nicholas Georgescu-Roegen". In Mayumi, Kozo; Gowdy, John M., eds. Bioeconomics and Sustainability: Essays in Honor of Nicholas Georgescu-Roegen. Cheltenham: Edward Elgar. ISBN 1858986672.
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45. Spengler, Joseph J. (1976). "The Population Problem: Its Changing Character and Dimensions". In Tang, Anthony M., eds.; et al. Evolution, Welfare and Time in Economics: Essays in Honor of Nicholas Georgescu-Roegen. Lexington, Massachusetts: Lexington Books.
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Further reading

• Tang, Anthony M., eds.; et al. (1976). Evolution, Welfare and Time in Economics: Essays in Honor of Nicholas Georgescu-Roegen. Lexington, Massachusetts: Lexington Books.
• Rifkin, Jeremy (1980). Entropy: A New World View. New York: The Viking Press. ISBN 0670297178.
• Drăgan, Joseph C.; Demetrescu, Mihai C., eds.; et al. (1993). Entropy and Bioeconomics. Milan: Nagard Publishers.
• Daly, Herman E., ed. (1997). "The Contribution of Nicholas Georgescu-Roegen". Ecological Economics (Amsterdam: Elsevier) 22 (3). (Special issue)
• Beard, T. Randolph; Lozada, Gabriel (1999). Economics, Entropy and the Environment: The Extraordinary Economics of Nicholas Georgescu-Roegen. Cheltenham: Edward Elgar. ISBN 1840641223.
• Mayumi, Kozo; Gowdy, John M., eds. (1999). Bioeconomics and Sustainability: Essays in Honor of Nicholas Georgescu-Roegen. Cheltenham: Edward Elgar. ISBN 1858986672.
• Mayumi, Kozo (2001). The Origins of Ecological Economics: The Bioeconomics of Georgescu-Roegen. London: Routledge. ISBN 0415235235.
• Bonaiuti, Mauro, ed. (2011). From Bioeconomics to Degrowth: Georgescu-Roegen's "New Economics" in eight essays. London: Routledge. ISBN 0203830415.
• Valero Capilla, Antonio; Valero Delgado, Alicia (2014). Thanatia: The Destiny of the Earth's Mineral Resources. A Thermodynamic Cradle-to-Cradle Assessment. Singapore: World Scientific Publishing. ISBN 9789814273930.

External links

• "Bibliography of Nicholas Georgescu-Roegen". Associazione Nicholas Georgescu-Roegen. Retrieved November 2015. (Italian website)
• Antonio Valero (1991). "An interview with Nicholas Georgescu-Roegen" (Location: Nashville, Tennessee). Ciudades para un Futuro más Sostenible. Retrieved November 2015. (Introduction to the interview in Spanish (Castilian), the interview itself in English)
• Sylvia Nasar (1994). "Nicholas Georgescu-Roegen, Leading Economist, Dies at 88". New York Times. Retrieved November 2015. (Obituary)
• Robert Nadeau (2008). "Environmental and ecological economics". The Encyclopedia of Earth. Retrieved November 2015. (A thorough account of the historical development of ecological economics, including Georgescu's contribution)
• Rex Weyler (2010). "Deep Green: Entropy and Ecology". Greenpeace International. Retrieved November 2015. (A brief perspective on Georgescu's 'entropy' view)
• Jonathan Mingle (2015). "Pope Francis would love the obscure theories of this dead Romanian economist". Quartz. Retrieved November 2015. (Article speculating on one possible source of inspiration for the pontiff's controversial encyclical on ecological concerns)
• "Facebook profile of Nicholas Georgescu-Roegen". Facebook. Retrieved November 2015.