The true cost of a consumer item such as paper includes
- Internal costs
such as raw materials, labor, rent, that are calculated into the consumer price.
- External costs
such as depletion of resources, pollution, degradation of the environment, that are hard to calculate
but are shared among all humans and other organisms.
Traditional economic models assume a linear
system of resource usage.
A sustainable economy should consider closed-loop
system that includes external costs.