What is the Doughnut Economy?

The Doughnut Economy is a visual framework for sustainable development. Imagine a circle shaped like a doughnut:

• The inner circle is the social foundation. It sets the minimum living standards people need. We need food, clean water, housing, education, healthcare, gender equality, a stable income, and a voice in the political process. If societies fall below this line, people live in deprivation.
• The outer circle is the ecological ceiling. It marks the limits of Earth’s natural systems, climate stability, biodiversity, freshwater, fertile soils, and clean air. Overshooting this line risks environmental collapse.

Who coined the term Doughnut Economy?

The idea came from Kate Raworth, a British economist and researcher at the University of Oxford and Amsterdam University of Applied Sciences. She introduced the concept in a 2012 Oxfam paper, later expanding it in her book Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist (Raworth, 2017).

The Doughnut Economy Model

The model is built on two boundaries:

1. The Inner Ring (Social Foundation)

• Covers 12 dimensions of basic human needs.
• Drawn from the UN’s Sustainable Development Goals (SDGs).
• Examples: access to food, clean water, housing, healthcare, and education.

1. The Outer Ring (Ecological Ceiling)

• Drawn from the concept of planetary boundaries (Rockström et al., 2009).
• Includes climate stability, biodiversity, freshwater use, and land system change.
• Crossing this ceiling means ecological Disaster.

 

Difference between Circular Economy vs Doughnut Economy

It’s easy to confuse the two, but they are not the same.

• Circular Economy

• Focuses on closing resource loops.
• Goal: reduce waste, reuse materials, recycle products.
• Example: a company redesigns packaging to be fully recyclable.

• Doughnut Economy

• Goes beyond resources to include social justice.
• Balances ecological limits with fair distribution of wealth, opportunities, and well-being.
• Example: designing housing that is affordable, sustainable, and energy-efficient.

In short, the circular economy deals with the “how” of resources, while the Doughnut Economy tackles the “why and for whom” of the system itself. They are complementary—circular practices fit inside the doughnut’s ecological ceiling.

Case Studies Around the World

1. Amsterdam, Netherlands In 2020, Amsterdam became the first city in the world to officially adopt the Doughnut model as its policy framework. The city used the doughnut model to guide housing, food, and energy strategies.

• Impact: Amsterdam set goals to reduce raw material use by 50% by 2030, and achieve a fully circular economy by 2050 (City of Amsterdam, 2020).
• Example: New housing projects must consider both carbon emissions and affordability.

2. Costa Rica Costa Rica often ranks high in well-being while keeping ecological footprints relatively low.

• The country generates 99% of its electricity from renewable sources (IRENA, 2022).
• It protects over 25% of its land as national parks and reserves, while achieving a life expectancy of 80 years—close to that of high-income nations (UNDP, 2021).
• This balance reflects the doughnut principle: high quality of life without breaching planetary limits.

3. Bhutan Instead of GDP, Bhutan measures progress through Gross National Happiness (GNH), a system rooted in cultural values, community, and environmental care.

• Over 70% of Bhutan’s land remains forested, and it is the world’s only carbon-negative country (Royal Government of Bhutan, 2021).
• Citizens enjoy universal healthcare and education, showing how social needs can be met while protecting ecosystems.

These stories prove the Doughnut Economy is not just a theory—it works in practice, from Europe to Latin America to Asia.

Simple Doughnut Checklist

Here’s a simple checklist you can try in your daily life, community, or organization:

1. Check your footprint — Use a carbon or ecological footprint calculator.
2. Think social, not just green — Support businesses that treat workers fairly and respect communities.
3. Eat within the doughnut — Choose local, seasonal, and plant-based foods when possible.
4. Reduce waste — Repair, share, and reuse before buying new.
5. Advocate — Ask schools, colleges, or workplaces to align with Doughnut principles.
6. Stay informed — Read about cities and groups applying the model.

Small steps matter, but collective pressure and systemic change matter even more.

Conclusion

The Doughnut Economy is not about perfection. It’s about balancing human needs while respecting the planet. From Amsterdam’s city policies to Costa Rica’s renewable energy and Bhutan’s Gross National Happiness, real-world stories show this model is more than theory.

References

• City of Amsterdam (2020). Amsterdam Circular Strategy 2020–2025.
• Global Footprint Network (2022). Earth Overshoot Day Report.
• International Renewable Energy Agency (IRENA) (2022). Renewable Capacity Statistics.
• Raworth, K. (2017). Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist. Random House.
• Rockström, J., et al. (2009). Planetary Boundaries: Exploring the Safe Operating Space for Humanity. Ecology and Society.
• Royal Government of Bhutan (2021). National Environment Commission Reports.
• UNDP (2021). Human Development Report.
• World Bank (2021). World Development Indicators.