The Limits to Scarcity
Rating: 
The trouble with scarcity is that it’s taken as value neutral. It helps explain why supply and demand economics works as it does. Scarcity sets the price of something – with a finite supply, price varies to balance the equation. The problem is, scarcity is personal – someone loses out. If that’s a seat at a concert it’s just bad luck/timing or lack of funds (try a video instead. If it’s something slightly more serious such as food or water then the implications are far more wide-ranging. This starts us along the road to some very searching questions – the sort of road that sustainability economics often leaves alone and classical economics is happy to assume is just a number. The basic idea here is that if we are to achieve some level of human development then some will need to use less to enable those without to have more. That this flies in the face of current ideas of individualism is just one aspect needing unpacking.
Any volume that links Maslow and Malthus is going to be a very serious challenge to conventional thinking. In the preface, the editor argues for a number of themes: scarcity is often a question of power relations; scarcity is not universal but localised; it is rarely fully analysed and it is largely suffused by politics. The text itself is divided into three. The first part discusses why scarcity matters. It starts with the notion that scarcity as a term has become shifted to include most things most of the time. The argument follows that if there is always scarcity, then it doesn’t matter because whatever happens, it still exists. As this theme is developed further we see nuances. Scarcity becomes the defining issue in an over-consuming society – it legitimises markets where the Rostowian end-point is sought. Oil is taken as an example, where we are told the re is an energy shortage (which there isn’t) where what we do have is shortage in specific formats and locations. US oil policy is used to critique this case. A final case examines how we use Malthusian narratives to reduce the population growth in the “South” as a scarcity issue – i.e. too many people and too few resources (or perhaps too many of them means not enough resources for us. As Mehta argues, it’s an intensely political debate.
Part two engages more directly with the notion of scarcity and how it was proposed. An initial contribution looks at the way in which economists use the term or rather try to use the term because often, market imperfections make it too difficult to operationalise. Perhaps, as is argued here, other ways of looking at the problem are required. Another debate surrounds the use of scarcity in sustainable development which, although it tries to do otherwise, often results in a very similar perspective to that of classical economics. Maybe the answer is to ignore scarcity completely and move towards others ways of seeing – post-modernism for example or even those who espouse happiness indices to examine the human condition. Yet another contribution looks at scarcity as part of the ideology of economics and the “limitless desire for accumulation”. Finally, there’s a contribution that questions the whole notion of value and posits a ‘rubbish theory’ – the idea that some goods reach a point of no value and are discarded where they might (as antiques) gain value again. This is used to critique the way classical economic sees scarcity.
Part three takes on a more practical terms by examining the role of scarcity in real situations. Neo-Malthusianist views suffuse population studies with the view of scarce created by an over-fecund people. This gives scarcity a political value because it can be used to partition resources to “save” them. Soil fertility can be seen as a scarcity. Where it is present, it’s normally considered as a negative but it can also, for the local farmer, be a positive (prices will rise). If we move this to the obesity/famine area we see scarcity as a political tool – clearly there is enough food, price distortion makes it “uneconomic” to move it. Water management is another classic with preference given to large-scale projects which are seen to address a scarcity that might not, in reality, be present. India is the case noted (but there are others) Water as an economic good differs considerably from water as a social need. If water is “scarse” then powerful actors can create projects to “solve” the problem whilst often just increasing their inflence of money.
This is a very powerful text and one that requires considerable thought. Whilst it is clear (and has been for many years) that scarcity is a flawed concept (especially in relation to the distribution of environmental “goods” – think North Sea Cod!) alternative perspectives are not obvious and there is no reason to think that this text has completely discussed and finalised the matter. What you do have is a very challenging set of ideas – the more so because of their extensive references and clear logic – they use the tools of classical economic debate to highlight its errors. It’s one of the best recent texts on economic thought and deserves a wide readership.
