Toward a neoclassical theory of sustainable consumption: Eight golden age propositions

•Neoclassical economics reveals the deeper nature of sustainable consumption.•Neoclassical growth, general equilibrium, and duality theories must be invoked.•Such a framework confirms some tenets of ecological economics and challenges others.•Phelps' Golden Rule is confirmed and modestly extended.•Eight “golden age” propositions follow from these considerations.

Popular trends in ecological economics increasingly consign neoclassical economics to the sidelines of modern-day relevancy. The neoclassical tradition is often seen as reliant for its authenticity on a presumption of human avarice - both unbridled consumerism and corporate cupidity - and demanding for its real-world applicability an assumption of continuous economic growth in a world of hard limits.This article examines the question of whether neoclassical theory could instead provide keys to deeper understanding of sustainable consumption. By combining in a single framework neoclassical growth theory, general equilibrium theory and duality theory - and by explicitly considering leisure time - the analysis demonstrates that neoclassical economics yields several useful insights bearing on long-term sustainability. The analysis confirms several tenets of ecological economics and challenges others.Eight propositions emerge from this analysis that could help speed the development of a robust neoclassical theory of sustainable consumption, here branded “golden age” propositions as they strongly echo the “Golden Rule” discoveries of Edmund Phelps.

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