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The doughnut economy is an economic model that aims to stay within the planet’s boundaries. It is a sustainable model that strives to meet human needs within the Earth’s ecological boundaries. This model requires rethinking the use of natural resources by stopping unsustainable exploitation. The model got created by the economist Kate Raworth and is currently the economic model of Amsterdam (2021).

What is a doughnut economy?

The model is known as the “doughnut economy” because it has a diagram shaped like a doughnut. It is a thick circle with a hole in the middle. Humanity’s essential needs are within the circle, in the centre – for example, clean water, education and healthcare. The doughnut symbolises a place where human necessities get fulfilled within the planet’s boundaries. In other words, this is the “good” part. The space outside of the doughnut symbolises the overconsumption of the world’s resources. That space is where human actions lead to climate change and biodiversity loss. 

Nine ecological boundaries

In the model, the Earth has mainly nine ecological boundaries. These are climate change, ocean acidification, chemical pollution, nitrogen and phosphorus pollution (nutrient pollution from fertilisers) and freshwater use. More so, land conversion (for roads and agricultural land), loss of biodiversity, air pollution and reduction of the ozone layer.

12 social goals

Furthermore, the doughnut economy has 12 social goals, in line with the sustainable development goals (SDGs). These are food, health, education, income and work, democracy, social justice, gender equality, housing, social capital, energy and water.

The doughnut economy stands in contrast to the economies of today. The purpose is to create a thriving economy, moving away from the present focus of constant economic growth. 

The doughnut economy in Amsterdam

In 2020, Amsterdam became the first capital of the world to use the doughnut economy as a model. The development followed the Covid-19 pandemic to create a more sustainable economy. The municipality began by examining how the city could create a thriving economy. Amongst many things, they also investigated how to exist sustainably with respect for the well-being of all life.


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