Physical economics within the context of modern economic problems

Abstract

Recently there was an active discussion about the effectiveness of the application of monetary theory in creating the foundation for qualitative changes in the economy. At the same time the global challenges that humanity has faced necessitate understanding the alternatives for economic development taking into account the growing population and the negative impact of man on the environment. Physical economics measures the effectiveness of the socio-economic system in physical terms and seeks to overcome the limitations of monetary theory. The application of this approach moves economic analysis from the value judgments that accompany wealth valuation approaches. The article analyzes the works concerned with physical economics within the context of modern economic problems. We formulate the main provisions and methods of economic approach that differs from other theories of the natural-scientific trends in economics. It is concluded that the physical economy is not able to solve many problems of the economy – ​it sets the vector of research aimed at solving the problem of interaction of social, technical and natural systems. It also focuses on the factors of labor productivity that make qualitative changes in the structure of the economy. The logic of the physical economy demonstrates that the destructive consequences of scientific and technological progress should be compensated by the creative efforts of man. Analysis based on physical quantities is a preliminary stage for modeling economic processes on the basis of natural and cost indicators.