Economic alternatives and community-led initiatives
Economic pluralism is a theoretical approach that suggests broadening the domain of economics beyond the paradigms that are dominant since mid-20th century. Diverse and abundant alternative ideas and models abandon theoretical dogma in favour of the practical question of how to live together in shared prosperity on an ecologically finite planet.
Dominant economic paradigms have been subject to questioning and critique since the 1960s. By the second decade of the 21st century, these criticisms, and the supporting evidence behind them, have accumulated to a point where they are seen as fundamentally incompatible with sustainability, including fulfilment of the Paris Agreement, Sustainable Development Goals and Green Deal.
Origins and History
Over the past centuries, the scientific discipline of economics has undergone a metamorphosis from the interdisciplinary and socially embedded approach of classical political economy to the contemporary mathematical approach of neoclassical economics.
Classical political economists in the 18th and 19th century such as Adam Smith, John Stuart Mill and Karl Marx have studied the economy as the social process of the production, distribution and consumption of goods and services. This approach regards economic processes as embedded in society and considers factors such as power relations, classes and values.
Since the early 20th century, neoclassical economics became the new dominant approach in economics which employs a highly abstract and mathematical methodology and gradually removed political, ethical and societal considerations .
The focus of economic analysis shifted from understanding processes in the real-world economy towards deriving the understanding of the economy from reductionist models of individuals’ behaviour that is assumed to be rational, selfish and driven by an insatiable desire to maximise utility. 
Such a mathematical and abstract understanding of economics that is detached from real-world society fails to grasp contemporary societal challenges such as climate change and social inequality in all its complexity. Furthermore, neoclassical analysis and its conceptions of utility and efficiency do not account for the multitude of non-monetary benefits that community-led initiatives can offer. Consequently, mainstream economic policy making, which is informed by neoclassical economics, tends to address economic and societal challenges in line with those neoclassical assumptions and approaches.
This is reflected in policy priorities that were predominantly favoured throughout the past decades such as neoliberalism, technocratic approaches to environmental challenges, and economic growth. However, these policy approaches have shown to be incapable of dealing with the intensifying global social, ecological and economic crises.
Out of these shortcomings of dominant economic science and policy emerged the call for more pluralism in economics. Accordingly, economics can benefit from a greater diversity of theories, values, approaches, and methods to be used for the analysis of economic processes. The International Confederation of Associations for Pluralism in Economics thus argues for an inclusion of classical, post-Keynesian, institutional, ecological, evolutionary, feminist, Marxist, and Austrian schools of thought as "each tradition of thought adds something unique and valuable to economic scholarship".
Practical application in communities
In order to understand and assess the role and potential of community-led initiatives in societal and economic processes, economic concepts and approaches are needed that go beyond the scope of neoclassical economics. Such approaches need to study the economy as social provisioning process, that is “the on-going economic process that provides the flow of goods and services required by society to meet the needs of those who participate in its activities”. Such a perspective considers not only monetary market exchanges, but includes the provision of non-monetary and informal services, such as care work.
Only approaches that employ such a comprehensive understanding of the economy are able to assess the full potential of community-led initiatives. Furthermore, an interdisciplinary and diverse set of concepts is needed in order to grasp the role of community-led initiatives in the complexity of the social provisioning process with its diverging values, power relations and ecological implications.
As response to this need for greater economic pluralism, many alternative concepts and approaches have been developed in the past decades. A selection of approaches to economics that offer particularly useful insights and theoretical frameworks for studying the role of community-led initiatives in social provisioning is listed below.
Links to key examples
Research on Economic alternatives and community-led initiatives and Community-Led Initiatives
- Social Provisioning Process
- Economic form versus substance (Polanyi)
- Political economy
- Post-growth economics
- Feminist economics
- Post-colonial economics
- Doughnut economics
- Wellbeing economy
- Bioregional economy
- Economy for the common good
- Economic localisation
- [Website on economic pluralism]
- [https://www.researchgate.net/publication/319271335_Social_Provisioning_Process_A_Heterodox_View_of_the_Economy Jo, Tae-Hee; Zdravka, Todorova (2017): Social Provisioning Process. A Heterodox view of the Economy. In Tae-Hee Jo, Lynne Chester, Carlo D'Ippoliti (Eds.): The Routledge Handbook of Heterodox Economics. Theorizing, Analyzing, and Transforming Capitalism. London: Routledge, pp. 29–40.
- Georgescu-Roegen, Nicholas (1979): Methods in Economic Science. Journal of Economic Issues 13 (2): 317–328.
- Gowdy, J. M. (2009). Microeconomic Theory Old and New: A Student's Guide, Stanford University Press.
- Arcidiacono, Davide; Barbera, Filippo; Bowman, Andrew; Buchanan, John; Busso, Sandro; Dagnes, Joselle et al. (2018): Foundational Economy. The Infrastructure of Everday Life. Manchester: Manchester University Press.
- Baskin, Jeremy (2015), Paradigm Dressed as Epoch: The Ideology of the Anthropocene. In Environmental Values 24, pp. 9–29.
- Jackson, Tim (2016): Prosperity Without Growth: Foundations for the Economy of Tomorrow. Oxon, New York: Routledge.
- Gruchy, Allan G. (1987): The Reconstruction of Economics. An Analysis of the Fundamentals of Institutional Economics. New York: Greenwood Press, p. 21.
- Fanning, Andrew L.; O'Neill, Daniel W.; Büchs, Milena (2020): Provisioning Systems for a Good Life within Planetary Boundaries. In Global Environmental Change 64.