Reading Comprehension

PT106 · S4 · P3 · Q14 Steady-State vs. Neoclassical Economics

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Recently, a new school of economics called steady-state economics has seriously challenged neoclassical economics, the reigning school in Western economic decision making.

Topic

The debate between steady-state economics and neoclassical economics regarding economic growth and environmental limits.

Framework

Present Debate

Main Point

The passage presents a debate: Neoclassical economists see no environmental limits to economic growth, while steady-state economists argue that unlimited growth is unsustainable and propose alternatives such as conservation to keep the economy in balance with nature. *The "Most Valuable Sentence" appears at the beginning of paragraph 2: *

P1: Introduction to the Competing Economic Models

This paragraph introduces the two schools: neoclassical economics, which dominates Western economic thinking and claims there are no limits to growth, and steady-state economics, which challenges that idea by raising concerns about non-economic constraints (like the environment).

P2: Explaining the Debate—Nature’s Limits vs. Unlimited Growth

Here, the author details the steady-state view that the economy depends on natural resources, which are limited and can't support endless growth. Steady-state economists argue for an optimal size for the economy and warn that exceeding it would cause more harm than good. In contrast, neoclassical economists believe resources can be replaced and growth can continue indefinitely.

P3: The Case for Steady-State—Alternatives to Growth

This paragraph discusses how some steady-state economists believe the Western world has already grown past optimal levels. They propose that checking economic growth doesn't mean stagnation—it's possible to satisfy human needs through better resource management (like conservation and recycling), rather than just by expanding the economy.

14.

Which one of the following most completely and accurately expresses the main point of the passage?

Neoclassical economists, who, unlike steady-state
Wrong Emphasis: neoclassical
The main clause of this answer says, Neoclassical economists hold that X, believe that Y and that if Z then A. We're looking for an answer to center around both schools of thought, or to center around the new school of thought, steady-state. The fact that steady-state gets alluded to in a little grammatical aside doesn't cut it. It should be center stage.
5% picked this
Some neoclassical economists, who, unlike
Wrong Emphasis: neoclassical
The main clause of this answer says, Some neoclassical economists who hold that X, believe that Y . We're looking for an answer to center around both schools of thought, or to center around the new school of thought, steady-state. The fact that steady-state gets alluded to in a little grammatical aside doesn't cut it. It should be center stage.
2% picked this
Some steady-state economists, who, unlike
Wrong Emphasis
Wrong Emphasis: should adopt conservation Out of Scope: even if stagnation This is better than (A) and (B), in that it's finally putting steady-state more into primary focus. But why would the main point be about some steady-state economists. Was the passage focused on certain people? No, it focused on the whole economic school of thought of steady-state economists. The central topic is "steady-state economics", not "some steady-state economists". That's enough to discount this answer on a first pass. However, ultimately there is no answer choice that properly centers the answer around "steady-state economics", so we do come back to (C) and (D) once we realize they might be our best available choices. Digging into the details on this answer, we can pick on the idea that no steady-state economist said that we should adopt conservation even if it leads to stagnation. The recommendation for conservation is an attempt to avoid stagnation. And this answer presents steady-state's main idea as, "Some steady-state economists believe that Western economies should limit growth by adopting conservation strategies". This idea is more of a by-product of their core belief, not their core belief. We want the main idea to be what centrally distinguishes steady-state from neoclassical: whether or not an economy is a closed system with no outside noneconomic impingements (neoclassical) or whether economies are limited by the outside noneconomic impingement of nature's capacities (steady-state).
6% picked this
Correct
Some steady-state economists, who, unlike
Why this is right
As discussed with (C), it's ridiculous for the main point answer to center around some steady-state economists, rather than the whole school of thought. But, we remind ourselves, we have to pick the best available answer. This answer improves on (C) because it better captures the philosophical difference between neoclassical and steady-state (whether or not the optimal size of an economy is limited by an external factor like natural resources). And it better expresses the part of the conversation that dealt with conservation. Whereas (C) made it seem like conservation was being suggested, despite its downside of potentially leading to stagnation, this answer better captures the steady-state economists' optimism that there are ways to restrain the size of an economy (so that it's in accord with nature's capacity to support it) without sacrificing the satisfaction of human wants. "One of the alternatives is conservation". This answer properly expresses that conservation is just one possible tool in the steady-state toolbox. (C) made it sound like conservation was the central plank of the steady-state school's agenda.
Skill tested: Main Point · how this choice captures the passage's function is the move to repeat next time.
79% picked this
Steady-state and neoclassical economists, who
Contradicted
This answer has the most lovable form on a first pass, because it seems to properly portray the main point as a debate between two schools of thought. However, it doesn't identify the terms of the debate properly at all. We have no textual support that steady-state economists "hold that economies involve the circular flow of exchange value between producers and consumers". And steady-state economists are definitely not trying to figure out the most effective way of "guaranteeing that a steady increase continues unimpeded". That sort of perpetual growth engine is only something desired by neoclassical economists. Steady-state doesn't want perpetual growth; they want sustainable optimal size.
8% picked this

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