Unifying Mainstream Economics with Ecology and the First and Second Laws of Thermodynamics with Steve Keen

In the lecture above, the economist Steve Keen outlines a model of capitalism that accounts for the role of energy. If it's held that the first and second law of thermodynamics are to be upheld as scientific fact, then we should be able to construct a system for understanding economics that is consistent with both.

Steve Keen explains how Karl Marx, while being far ahead of his time in understanding the intrinsically unstable features of capitalism, was unable to reconcile his labor theory of value with the fact that capital provides an obvious input into capitalism by utilizing energy through the electromagnetic force. In our modern world, we can intuitively understand that the tremendous role of energy in the form of capital adds substantial work value by harnessing energy from hydrocarbons. Keen explains that Marx had to maintain his Labor Theory of Value for political reasons, otherwise, if we include the addition of energy that capital provides, capitalism does not necessarily collapse on itself from the falling rate of profit, as Marx asserts.

https://www.youtube.com/user/ProfSteveKeen/videos

Click the link above to visit Steve Keen's youtube page full of lectures. Steve Keen is an expert on Hyman Minsky's Financial Instability Hypothesis which states that Capitalism is prone to boom and bust cycles driven by the expansion and contraction of private debt.