Ecological Transition and the Clash Between Economic Compatibility and Social Demands

Abstract

The rise – not entirely unforeseen – of ecological issues today requires all communities to rethink their relationship with natural resources and ecosystem balances. Such an effort requires channelling all the best economic and social forces towards environmental sustainability objectives. With this in mind, the European institutions, in the context of the so-called green deal, have set up a regulatory framework to allow players in the financial markets to make their own contribution to this end: a contribution that is imagined to be central and decisive given the financial commitment required by the transition. For this reason, the regulatory framework is particularly attentive to promoting and not throttling market logics that are meant to be virtuous. In particular, this is the bet underlying the European taxonomy regulation. However, the centrality of market mechanisms underlying this regulation implies a substantial abdication of political decision-making, which entrusts the choice of the fundamental priorities to be pursued with green investments to market logics. In particular, market mechanisms are entrusted with the choice of how to balance the goal of climate change mitigation and that of adapting our societies to the changes taking place. This could lead to an overestimation of economic compatibilities to the detriment of the correct evaluation of social demands, which would significantly diminish the concrete chances of achieving the fundamental objectives of the green deal.