Systems Perspective on the Interrelations between Natural, Human-made and Cultural Capital

Abstract

"In recent years substantial progress has been achieved in the field of ecological economics for clarifying human-nature interrelations. The fundamental role of the life-support functions of the environment (Odum, 1975) for economic development and sustainability has entered from ecology into economics, and has started to be theoretically as well as empirically analyzed. This has, in part, given rise to the terminology of natural capital and human-made capital. In contrast to the assumptions of standard economic theory, ecological economists regard human-made capital and natural capital as fundamentally complementary. Natural capital and its derived goods and services are the preconditions or the basis for economic development. It is not possible for human ingenuity to create human-made capital without support from natural capital (e.g. Daly, 1990). Moreover, it is not possible to approach sustainability by only focusing on these two factors, natural capital and human-made capital interrelations. We need a third dimension, what we refer to as cultural capital, as well. From a systems perspective, we emphasize that the three types of capital are strongly interrelated and form the basis for guiding society towards sustainability."