chapter  4
Recovering and extending classical and Marshallian foundations for a Post-Keynesian environmental economics
Pages 20

It comes as little surprise that Post-Keynesian theories have paid insufficient attention to environmental economics. The primary focus of Post-Keynesian economics has been on demand-side problems of underemployment and theories of production and growth that assume the availability of resources through time. Post-Keynesians, Lavoie (2004) notes, reject supply-side arguments and insist that ‘effective demand rules’, even in the long run. We can safely assume that most Post-Keynesians agree that environmental sustainability is a central issue for humans and the planet. Why then have Post-Keynesians been slow to develop an environmental economics extending their understanding of the interconnections of society and economy to the issue of connections between the economy and nature? I suggest that this neglect is due in part to the neglect of ‘supplyside’ issues that must necessarily include a rigorous physical specification of the natural resource flows linking economy and nature. Post-Keynesian production theories have adopted a too-easy presumption of resource availability through time in their treatment of production and growth in opposition to neoclassical theories of resource scarcity.