Editing Factors of production (section)

=== Ecological economics ===
[[Ecological economics]] is an alternative to [[neoclassical economics]]. It integrates, among other things, the first and second laws of thermodynamics (see: [[Laws of thermodynamics]]) to formulate more realistic economic systems that adhere to fundamental physical limitations. In addition to the neoclassical focus on efficient allocation, ecological economics emphasizes sustainability of scale and just distribution. Ecological economics also differ from neoclassical theories in its definitions of factors of production, replacing them with the following:<ref name="The Other Road to Serfdom">{{cite book| author = Eric Zencey| title = The Other Road to Serfdom & the Path to Sustainable Democracy| year = 2012| publisher = U of New England| isbn = 978-1-58465-961-7 }}</ref><ref name=" Ecological Economics: Principles and Applications">{{cite book| author = Herman Daly|author2=Joshua Farley | title =  Ecological Economics: Principles and Applications| year = 2011| publisher = Washington: Island| isbn = 978-1-59726-681-9 }}</ref>
* Matter — the material from which products are produced. Matter can be recycled or reused through refining or reforming, but it cannot be created or destroyed, placing an upper limit on the amount of material that can be withdrawn and used. Consequently, the total amount of available matter is fixed, and once all the available matter is used, nothing more can be produced without recycling or reusing matter from prior products.
* Energy — the physical but non-material inputs of production. We can place different forms of energy on a scale of utility depending on how useful it is for creating a product. Due to the law of entropy, energy tends to decrease in utility over time. (e.g. electricity, a very useful form of energy, is used to run a machine that builds a stuffed bear. In the process, however, electricity is converted to heat, a less useful form of energy). Like matter, energy can neither be created nor destroyed and thus there is also an upper limit to the total amount usable energy.
* Design intelligence — a factor that incorporates the knowledge, creativity, and efficiency of how goods are created - the better the design, the more efficient and beneficial the creation is. Designs are usually improvements on their predecessors since our store of accumulated knowledge grows with time. One possible neoclassical analogue of design intelligence is technological progress.

Integral to ecological economics is the following notion: at the maximum rates of sustainable matter and energy uptake, the only way to increase productivity would be through an increase in design intelligence. This provides the basis for a core tenet of ecological economics, namely that infinite growth is impossible.<ref name="The Other Road to Serfdom"/>