Internalizing externalities and re Sample Clauses

Internalizing externalities and re embedding social and ecological relations into economic activity To formulate our basic argument, we start by using an economic approach, building on the rich environmental‐economics literature. Later on, we generalize our approach towards social and public health issues. From an economic perspective, the basic problem is that the economy generates goods in a way that externalities are produced. The solution to the problem can be twofold:  First, cleaner technology or inputs can be used to produce the polluting output. This generally rises the production cost of the output, and firms will only opt for this way, when they are forced to do so by law or when they can transfer the costs to the consumer, for instance by targeting a consumer segment interested in environmentally friendly products. The latter option concurs largely to the Xxxxxx‐Xxxxxx Xxxxx hypothesis. In the food system, input substitution would correspond to substituting external inputs, such as pesticides and mineral fertilizers, with practices that make better use of the underlying agroecosystem, such as natural enemies, nitrogen‐fixating plants, composting, etc. Cleaner technology that is resource saving refers for instance to precision agriculture, nutrient recycling, etc.  Second, consumption of the polluting output can be reduced and replaced by a cleaner substitute. Again, this can be achieved by regulation or by a shift in consumption preferences by consumers who are altruistic and intrinsically motivated to change the shape of their utility function. In the food system, this generally refers to two aspects: the ratio of plant versus animal‐based foodstuffs and the seasonality of food. Animal production generally puts a higher burden on the environment than plant production, while a diet based on plants only is feasible in terms of getting all crucial substances for human nutrition. Out‐of‐season consumption increases the energy bill of agricultural production either by increased energy use in greenhouses or by increased transportation following increased imports. Of course, a combination of both options can also occur. Here, producers and consumers take shared responsibility and co‐adapt, that is, producers change their production practices while consumers change their consumption practices. These strategies correspond to what the social‐science literature refers to as re‐embedding social and ecological relations into economic activity. Xxxxxx and Xxxxxx (2011) have conceptualized e...