Dear Designers - any consideration of the design of products or services  that does not take into account energy conversion and entropy production are hopelessly naive. - Bob Logan, a physicist who teaches a design course at OCAD U - Read on MacDuff

______________________
Robert K. Logan
Chief Scientist - sLab at OCAD
Prof. Emeritus - Physics - U. of Toronto 
www.physics.utoronto.ca/Members/logan


Begin forwarded message:

> From: Malcolm Dean <[log in to unmask]>
> Date: January 23, 2012 5:41:46 AM EST
> To: undisclosed-recipients:;
> Subject: Kummel 2011 The Second Law of Economics: Energy, Entropy, and the Origins of Wealth
> 
> http://books.google.com/books?id=YletVzzoqxcC
> The Second Law of Economics: Energy, Entropy, and the Origins of Wealth
> Reiner Kümmel
> Springer, 2011  ISBN 1441993649, 9781441993649
> 
> Nothing happens in the world without energy conversion and entropy production.  These fundamental natural laws are familiar to most of us when applied to the evolution of stars, biological processes, or the working of an internal combustion engine, but what about industrial economies and wealth production, or their constant companion, pollution?  Does economics conform to the First and the Second  Law of Thermodynamics?  In this important book, Reiner Kümmel takes us on a fascinating tour of these laws and their influence on natural, technological, and social evolution.  Analyzing economic growth in Germany, Japan, and the United States in light of technological constraints on capital, labor, and energy, Professor Kümmel upends conventional economic wisdom by showing that the  productive power of energy far outweighs its small share of costs, while for labor just the opposite is true.  Wealth creation by energy conversion is accompanied and limited by polluting emissions that are coupled to entropy production.   These facts constitute the Second Law of Economics. They take on unprecedented  importance in a world that is facing peak oil, debt-driven economic turmoil, and threats from pollution and climate change.  They complement the First Law of Economics: Wealth is allocated on markets, and the legal framework determines the outcome.  By applying the First and Second Law we understand the true origins of wealth production, the issues that imperil the goal of sustainable development, and the technological options that are compatible both with this goal and with natural laws.  The critical role of energy  and entropy in the productive sectors of the economy must be realized if we are to create a road map that avoids a Dark Age of shrinking natural resources, environmental degradation, and increasing social tensions.
> 
> http://www.springerlink.com/content/978-1-4419-9365-6#section=912595&page=1
> THE FRONTIERS COLLECTION 2011, DOI:10.1007/978-1-4419-9365-6
> The Second Law of Economics
> Energy, Entropy, and the Origins of Wealth
> Reiner Kümmel
> 
> Prologue: Time Travel with Abel 29-111
> Traveling in time and space from the Big Bang to the Sun and through the ages of the Earth we note that energy conversion is the prime mover in the evolution of life and the universe. We are witness to two revolutionary changes in the development of civilization when humans enhanced their access to the energy sources produced by the Sun. First, they increased their use of living biomass by the invention of farming and cattle breeding in the Neolithic Revolution after the climate had warmed and stabilized. About 10, 000 years later, humans started to exploit fossil energies by with the invention of the steam engine during the Industrial Revolution. Even without heat engines, Europeans had already conquered the world with firearms and sailing ships, which utilized the chemical energy of gunpowder and the kinetic energy of the wind. European dominance was shattered by World Wars I and II, which could not have gone global without fossil-fuel-powered heat engines. Since then, heat engines and transistors have decisively assisted the increasing production of material wealth. The resulting resource depletion and environmental pollution must be mitigated by a careful observation of the natural laws governing energy and entropy.
> 
> Energy 113-169
> Energy is the capacity to cause changes in the world. It is stored in matter and force fields. The Sun produces energy by nuclear fusion. Solar irradiation, and reradiation and capture of the infrared by the greenhouse gases in the atmosphere, determine the climate on Earth and the environment for life. The combustion of coal, oil, and gas in heat engines, and non-fossil energy utilization, provide every citizen of the industrialized countries with energy services that are quantitatively equivalent to those of more than 40 hard-working men. They offer freedom from toil, comfort, mobility, information, and power. Transistors, running on electricity, work as powerful assistants to the human brain. A given energy quantity consists of a valuable part, called exergy, which can be converted into any form of physical work, and a useless part called anergy. Fossil and nuclear fuels, and solar radiation as well, are practically 100% exergy, and anergy is mostly heat at the temperature of the environment. All production processes in nature and industry decrease exergy and increase anergy. Energy consumption in this sense depletes the reserves of the easily accessible fossil fuels at a rate that, for oil, may soon culminate in peak Ooil. The potential of energy conservation and of non-fossil energy sources are assessed.
> 
> Entropy 171-273
> Entropy is the physical measure of disorder. According to the Second Law of Thermodynamics it grows whenever something happens in the world. This shows up in the room of a playing child, on the desk of a working scientist, and in all natural and technical energy conversion processes. The growth of entropy determines the Arrow of Time. It prevents a Perpetuum Mobile of the Second Kind, which would be a cyclically operating machine that does nothing other than perform physical work and cool down a heat reservoir, such as the environment. All attempts to construct such a machine and establish an energetic fool’s paradise have failed and will fail. Furthermore, entropy production, inevitably coupled to energy conversion, is associated with exergy destruction and the emission of heat and particles. Model calculations of the Heat Equivalents of Noxious Substances show how sufficiently large energy inputs into pollution control processes, such as denitrification, desulfurization, carbon dioxide capture and storage (CCS), and nuclear waste disposal, can convert the emissions of material pollutants into heat emissions. The latter, however, accelerate the approach to the Heat Barrier, beyond which climate changes are expected even without the Anthropogenic Greenhouse Effect (AGE). The physics, cause, and consequences of the AGE are explained.
> 
> Economy 275-282
> Capital and labor have been traditionally considered the factors that produce the wealth of nations, which is measured by the gross domestic product (GDP). After the oil price shocks of the 1970s and 1980s, energy was occasionally taken into account as a third factor of production. But mainstream economics has the problem that it can explain only about half, or less, of the observed economic growth of industrialized countries by the growth of the production factors. The other half, or more, is attributed to technological progress. This is just a word for what is not understood and is also called Manna from Heaven. The cause of the problem is the cost-share theorem, according to which the share of a factor in total factor cost should be equal to the factor’s productive power. The latter is called output elasticity in economics. Roughly speaking, it indicates by what fraction of 1% the output of an economy, i.e. the GDP, changes if the production factor changes by 1% while all other factors stay constant. On the average, the cost shares have been about 25% for capital, 70% for labor, and 5% for energy in industrialized economies. Thus, energy plays hardly any role in orthodox theories of production and growth.
> However, the cost-share theorem can be disproved by including technological constraints on capital, labor, and energy in the derivation of the (equilibrium) state in which an economy is supposed to operate. This is shown for the state of maximum profit, and for the state of maximum overall welfare as well. Consequently, a new method of computing output from the inputs of capital, labor and energy is needed and developed. It reproduces economic growth in Germany, Japan and the USA in good agreement with the empirical data and yields productive powers that are much larger for energy and much smaller for labor than their cost shares. In fact energy, and its conversion into physical work, accounts for most of the growth that mainstream economics attributes to technological progress and related concepts.
> As energy conversion is inevitably coupled to entropy production, the resulting emissions threaten environmental stability and impair economic evolution. In other words, future growth strategies must observe the Second Law of Economics: Energy conversion and entropy production determine the growth of wealth. This complements the First Law of Economics: Wealth is allocated on markets, and the legal framework determines the outcome. The distribution of wealth, the accumulation of debts, discounting of the future, and perspectives on growth are discussed.
> 
> Epilogue: Decisions Under Uncertainty 283-293
> The easily accessible fossil energy sources are drying up, pollution is creating ecological problems on a global scale, and the increasing costs of providing energy contribute to the growing instability of the global financial system. The very uneven distribution of wealth that has resulted on national and global scales is likely to create social tensions and breakdowns that are dangerous in a world of growing population and nuclear weapons. All technical and social actions that may avoid a Dark Age of battles for diminishing resources bear risks, whose assessments by individuals and nations differ substantially. The first decision to be taken under these uncertainties should concern the legal framework of the market and its adjustment to the challenges of a future ruled more clearly than ever by energy and entropy. This adjustment should stimulate energy conservation and emission mitigation. Furthermore, it should invigorate those sectors of the economy where humans cannot be easily pushed aside by energy-powered machines, and observe simultaneously that the production of material wealth rests on the conversion of nature’s gift of energy into physical work. Whether the appropriate instrument is a social-ecological tax reform that shifts the burden of taxes and levies from labor to energy according to the productive power of these factors is a question that voters and governments will have to decide. Their decisions may well depend on the general acceptance of old and seemingly trite rules of conduct that serve to promote a minimum level of equity for all.
>