Ecological finance theory: New foundations

Thomas Lagoarde-Segot and Enrique A. Martínez

International Review of Financial Analysis, 2021, vol. 75, issue C

Abstract: This paper puts forth Ecological Finance Theory as a new vision for 21st century financial economics. We first motivate this project by referring to the current global bio-geophysical context. We then introduce new meta-theoretical hypotheses, which we compare with those of the previous paradigm. We then borrow concepts of resilience, diversity, self-thinning, self-regulated mitosis, and ecological transparency from biology and introduce them in the field of financial economics. Finally, we analyze the impact of an increase in ecological transparency on resilience and diversity by developing a new stock-flow consistent model with mitotic control. The present paper is hence an invitation to reorient financial theory in line with the Anthropocene context.

Keywords: Ecological finance theory; Finance; Sustainability (search for similar items in EconPapers)
JEL-codes: G00 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:75:y:2021:i:c:s1057521921000843

DOI: 10.1016/j.irfa.2021.101741

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