My understanding is that pareto improvements are positive sum by definition.
>> Given an initial situation, a Pareto improvement is a new situation where some agents will gain, and no agents will lose. [0]
Neonological seems to believe that pareto improvements are not possible because of negative externalities. Maybe they are right but positive externalities also need to be accounted for.
One way to see that the externality is overall negative is to make a small model of the economy with even tighter limits on the energy resource. You can literally hold this model in your head. We both agree that energy is a limited resource and that usage of a limited resource prevents others from using that resource and is thus zero sum.
Just replace all available energy with a free triple A battery gifted to you by the government per day. That battery can’t even push your car 100 meters. If you can’t drive then the suburban layout of US cities can’t even function. Every aspect of the economy will grind to a near standstill.
Energy is the primary resource that drives everything in an economy, everything. Because energy is limited the game in every economy is in actuality overall zero sum.
Because energy is relatively abundant right now, certain models of the economy sort of do work for certain scenarios when they don’t account for energy. But I think these models are still bad because, practically, even differences in energy utilization correlate with how technically advanced an economy is.
Once energy is used up, then all economies are basically dead. There is no positive externality here. Every economic transaction involves energy and is thus zero sum. If the United States uses up all the oil in the world to build its advanced economy then other countries and people in the future and past cannot build that same economy because there is no oil. Zero sum.
