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In 2020, the City of Amsterdam decided to abandon traditional economic indicators to guide their post-COVID recovery and officially adopted the “doughnut” economic framework. The Doughnut model comes from Kate Raworth’s pioneering book, Doughnut Economics: Seven Ways to Think Like a 21st Century Economist, where she presents a visual framework for sustainable development which balances social and ecological wellbeing. The framework proposed a way of measuring economic performance by its ability to meet people’s core needs without overshooting the earth’s ecological boundaries.
The inner ring of the doughnut represents ‘minimum standards of living’, based on the UN’s Sustainable Development Goals (SDGs). This entails the basic essentials everyone needs for wellbeing, from food and clean water to gender equality and a political voice. The outer ring of the doughnut represents the ecological limits of the planet, from biodiversity loss to air pollution.
Amsterdam aims to develop an economic recovery plan that keeps the city in “the safe and just space for humanity”. Through a series of multi-stakeholder workshops, the City has been assessing their performance using the Doughnut Economy framework. Housing, for example, is a major social issue as high rental costs in the city means that nearly 20% of tenants can’t afford to pay for other bills after paying rent. However, as the City considers building more housing to reduce costs, it must also consider the pollution and health impacts of this additional construction.
By embracing a multi-dimensional framework of the economy that measures success in terms of social and ecological outcomes, the city has been able to identify potential synergies and trade-offs between different goals.
The indicators outlined in the Donut Economic Framework have been used to assess the city’s current performance and are helping to inform decisions about the type of policy interventions needed to help Amsterdam can build back better towards a wellbeing economy.
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