The Limits to Certainty

The second edition of "The Limits to Certainty" has been thoroughly revised and edited. A new chapter on facing social uncertainty has been added, while the section on value and time in the service economy has been extended in order to include the conclusions of recent research conducted by the authors on the subject of waste prevention on the product level (ie making a better use of resources during the utilization of goods). The key to economic progress has always been the better allocation of resources, and the majority of resources available today are in the form of service activities. In order to measure and exploit such resources, one needs a theoretical frame of reference based on the notions of risk and uncertainty, rather than on the "certain" equilibrium of the present economic system. Service means performances, in real periods of time, which means that the identification of values must be based on probabilities: the assessment of the probability and cost of a distribution of events in the future. "The Limits to Certainty" is thus about the economic foundations of the service economy.Published under the auspices of the Club of Rome, it is, in fact, a follow-up to a report published by the Club in 1980, "Dialogue on Wealth and Welfare". In this report it was proposed that the limits to growth were the limits of a specific type of economic growth that had successfully been developed over a period of two centuries. This earlier report went on to propose that a new economic growth needed to integrate economic and ecological factors, in practice as well as in theory, and therefore revise the notion of economic value. This economic transition developed parallel to a growing movement at a more fundamental philosophical level favouring indeterminism against determinism: the notions of risks and uncertainty are increasingly considered as the realm of the new challenges, as compared to a perception - typical of the deterministic era - according to which risk and uncertainty reflect a level of "imperfect knowledge" which science would or should eliminate: a positive versus a negative connotation of risk and uncertainty.