Is wealth a measure of desire or a measure of physics?
In short: Standard economics defines value by what we are willing to pay for something—a measure of human desire. But there is another way to calculate worth: the physical energy required to create it. By tracking 'emergy,' we can map a nation's true well-being and sustainability through the lens of physics.
Energy Systems Theory suggests that because every phenomenon involves an energy transformation, we can account for all energy ever used—directly or indirectly—to create any item. This total historical energy cost is converted into a universal accounting unit called 'emergy,' typically expressed in terms of available solar energy. Unlike traditional currency, which fluctuates based on social agreement and demand, emergy provides a physical basis for value that remains constant regardless of human preference. This theory treats energy transformations as the underlying foundation for all phenomena. It allows us to treat previously spent energy as a single type of unit.
Denis White distinguishes between two fundamental ways of perceiving value: receiver-based (demand) and donor-based (supply). In our current economic model, we prioritize the receiver; we value goods based on how much consumers want them. However, an 'intrinsic' property valuation looks at the donor—the environment. Because producers must extract resources and labor from the world to create products, every item carries a hidden debt of energy taken from the planet. White notes that producers pay wages to consumers for their labor during production. This creates a loop where value flows between people and the environment.
This framework allows for a more rigorous way to measure national health. By using emergy budgets, we can calculate two specific indices: sustainability and self-sufficiency. Sustainability is defined as the sum of local and imported renewable emergy, while self-sufficiency is the sum of local renewable and non-renewable emergy. These metrics move the conversation beyond GDP, offering a way to see how much a nation relies on its own resources versus the global environment. These indices are visualized through specific maps and graphs of various nations. The lecture was presented at Gresham College on November 14, 2012.
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Sources
- Summary by Intellect · source: Energy and Emergy: Measuring Well-Being Among Nations - Denis White
- Also: Part Two: Energy and Emergy - Measuring Well-Being Among Nations
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