How Energy and Work Drive Material Prosperity
3. 3.1 Industrial metabolism: mass/energy ﬂows INTRODUCTION For practical purposes it is fair to say that wealth, which underlies welfare, is based on stocks of material goods (including land).1 From an economic perspective, welfare is a consequence of consumption, which is essentially that part of economic activity that is not productive of more wealth or simply destructive (such as warfare). The productive component of wealth is known as (industrial) capital, whereas the consumption-related part, consisting of residential housing and durable consumer goods, is not usually counted as part of capital stock, even though some have argued that it should be so counted. What matters for this chapter is that both production and consumption require ﬂows of material goods, as well as energy (or at least energy carriers) such as fuels and electricity. These ﬂows can be characterized as industrial metabolism. Technology (or knowledge) is not an element of wealth per se except to the extent that it can be protected and exchanged. Technology may be productive and therefore worth investing in, either for purposes of increasing skills and ‘know-how’ or – as R&D – in order to promote discovery, invention and innovation. But the knowledge base of an individual, or a ﬁrm, is rarely transferable or usable by others, except by means of a cooperative eﬀort of teaching and learning. Hence it is not a component of wealth. On the other hand, material goods that are either portable or transferable to diﬀerent owners by exchange of title are...
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