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Dimensions The human factor in the global environmental debate Spring 2012 • Issue 1 Shades of Green Global Perspectives on the Green Economy The Moral Universe The needed return of Sun, Wind and Water to our moral equation The Natural Economist Measuring the true costs and benefits of economic development It’s Not Easy Being Green Why UNEP’s Green Economy is not the panacea it is hoped to be Economics, Growth and Energy A sustainable economic future won’t be neoclassical Green Economy & Sustainable Hegemony Do we exist to serve our economic systems? Magazine of the International Human Dimensions Programme on Global Environmental Change Human D imens i on s 1 40 Contents 67 Feature Articles 8 Green Economy & Sustainable Hegemony —At the start of the 21st century, people have come to serve their economic systems, instead of the other way around. That isn’t sustainable and it isn’t smart. Andréa Hawkes and Nicolás Kosoy 17 What’s in our countries’ coffers? — The Inclusive Wealth Index goes beyond the conventional captial measures to provide a comprehensive picture of the wealth of nations. 20 Green Growth & Innovation —Home-grown technology and innovation in the developing world are key to achieving sustainable growth. Frans Berkhout 60 It’s Not Easy Being Green —Why UNEP’s Green Economy is not the panacea it is made out to be and will lead neither to economic growth nor to the emissions reductions necessary to combat climate change. Peter A. Victor and Tim Jackson 78 Sustainability: Reassessing what we count & measure Opinion editorial accepted to Project Syndicate Partha Dasgupta and Anantha Duraiappah 2 Hu m a n D im e n s io n s Illustrations and Photos Louise Smith 24 White, red, purple, orange, silver, blue, yellow, brown —A Green Economy isn’t always just green. 78 46 Interviews 60 Departments 5Editorial 12 The Natural Economist —Sir Partha Dasgupta of Cambridge University on the challenges of measuring the true costs and benefits of economic development. Sir Partha Dasgupta 6 53 Writing Contest Did you know that? 68Opinions 72 70 Greening the Urban Jungle —With more than half of the world population living in cities, urban planning must adapt to new models of sustainable development. Xuemei Bai explains how governments and institutions can catch up to technology in the race to save the planet. Xuemei Bai Community News 7Events Calendar Green Economy Crossword 74References CArtoons 23On the day the Green Economy finally arrives. 52 The new rose-coloured glasses. 67 But how will we get there? 38 Winners —We invited young scholars to take part in a scientific writing contest and have their work published in this first issue of Dimensions. 40 The Moral Universe —The needed return of Sun, Wind, and Water to our moral equation. Joy Merwin Monteiro 46 Economics, growth and energy in the Green Economy —Neoclassical theory can no longer frame our perspectives for a sustainable economic future. Andrew Fanning 54 Greening the Economy —An alternative paradigm to sustainable development and poverty eradication. Amandeep Kaur Human D imens i on s 3 Human DIMENSIONS Spring 2012 • Issue 1 Editor Carmen Scherkenbach [email protected] Copy Editors Ali Daniel Velazquez Carmona, and Maja Spasovska Graphic Designer Louise Smith Published by Secretariat of the International Human Dimensions Programme on Global Environmental Change (UNU-IHDP) United Nations University UN Campus Hermann-Ehlers-Str. 10 53113 Bonn, GERMANY Human Dimensions magazine features the activities of the International Human Dimensions Programme on Global Environmental Change (IHDP) and its research community. Human Dimensions is published biannually. Sections of the magazine may be reproduced with acknowledgement to IHDP. Please send a copy of any reproduced material to the IHDP Secretariat. This magazine is published using funds by the German Federal Ministry of Education and Research and the United States National Science Foundation. The views and opinions expressed herein do not necessarily represent the position of IHDP nor those of its sponsoring organisations. Subscription Human Dimensions is available free of charge, both online and in print. Subscribe to receive all future issues of the magazine in your inbox at www.ihdp. unu.edu/article/subscribe, or write to [email protected] to order individual hard copies. Online archive This issue and all future issues of Human Dimensions will be available online and as PDFs. Please visit our archive at www.ihdp.unu.edu/article/dimensions 2 Cover Artwork Louise Smith Hu m a n D im e n s io n s Editorial Welcome to IHDP’s newest product Dimensions. With this magazine we hope to engage a wide range of readers who are interested in the human dimensions of global environmental change and global sustainability. Dimensions will be IHDP’s premier dissemination outlet for key findings from its portfolio of projects. But it will also solicit articles and contributions from key scientists on selected topics in order to provide a broader and more diverse range of views on the issues under discussion. We at IHDP believe that there is no single answer to a problem as complex as the human dimensions of global environmental change and global sustainability. As knowledge facilitators, we see Dimensions as a platform for vibrant debate, inviting a spectrum of views and opinions – even those that challenge our own. Our editor welcomes readers’ responses of which a selection will be published in the following edition. This first issue takes on the Green Economy— a term that has been gaining traction over the past several years and will be a main point of discussion at the upcoming Rio+20 meeting. The Green Economy has been touted as the new economic model to address the social, environmental and economic crisis we face today. It touches equity, sound environmental management and new engines of economic growth. These are all key terms that resonate well with the future we envisage for our children and ourselves. The recent report from the UN Secretary General’s High-Level Panel on Global Sustainability has also identified the Green Economy as a new economic model for the future. This issue comes at the right time to spur a lively discussion among the scientific community on what precisely the Green Economy is, and what it should Human D imens i on s look like. The United Nations has taken the lead in suggesting the idea. It is now up to the scientific community—not only economists but also anthropologists, sociologists, physiologists, behavioural scientists, ecologists, climatologists and others—to actively engage in the design of such an economy. We need a paradigm shift, or what ecologists call a step shift, and to move away from the incremental model which has in essence led us to where we find ourselves today. I hope you enjoy reading Dimensions and welcome your feedback for its improvement in the future. Anantha Duraiappah Executive Director of the International Human Dimensions Programme on Global Environmental Change [email protected] 3 Community News U G EC P r oj ect R es u lt s U.S. Scientists call for integrated study of carbon cycle The carbon cycle science community in the United States has recently finished its planning process for carbon cycle research for the upcoming decade. This reassessment was initiated by the U.S. Carbon Cycle Interagency Working Group (CCIWG) and Carbon Cycle Science Steering Group (CCSSG) in 2008. The planning process is culminating in the publication of the new U.S. Carbon Cycle Science Plan, which was is intended to provide guidance for U.S. research efforts on the global carbon cycle for the next decade. Electronic copies of “A U.S. Carbon Cycle Science Plan” are available at www.carboncyclescience.gov/carbonplanning.php Call for pa rt ic ipa n t s & pa p e rs RegioResources 21 RegioResources 21 started in 2012 to establish a permanent cross-disciplinary dialogue on sustainability features in planning, decision- and policymaking on multiple scale levels. The conference series intends to provide an overview on the most recent questions and innovative solutions and to facilitate the intellectual exchange and methodological transfer between different disciplines addressed in regional resource management, planning, decision-making and policy support. The 2012 conference will be organized by Global Land Project (GLP) and the European Land-use Institute as an endorsed project in GLP, and will be held from 21–23 May 2012 at Dresden University of Technology. The deadline for submissions is March 30th. For more information see http://regioresources21.eli-web.com/. ES G O p p ort un it ies Governance Capacity-building Earth system governance as a research object is quickly emerging, and as a consequence, the number of academic programmes on bachelor, master and doctoral level related to earth system governance steadily increases. IHDP’s Earth System Governance Project also organizes, endorses and provides teaching to summer schools and capacity-building events and programmes. Members Vi si t us online of the Scientific Steering Committee and staff of the International Project Of- Always Up-to-date fice also give guest lectures around the world. An overview of all Earth System Governance capacity-building and teaching activities is now available at www. earthsystemgovernance.org/teaching. At www.ihdp.unu.edu you can stay up-to-date with the comings and goings of the entire Human Dimensions community. News on I HDP Sci e n t i f i c C o m m itte e Professors Ruth Oniang’o and Dan Ariely join IHDP Scientific Committee scientific advancements, research tools, project We are excited to announce the addition of two eminent scholars to the progress, new faces and IHDP Scientific Committee: The Honourable Professor Ruth Oniang’o, more are always available and Professor Dan Ariely. Both Professors Oniang’o and Ariely will bring in the Community section. valuable insight and expertise to IHDP’s work in addressing the human di- www.ihdp.org/article/com- mensions of global change, and we are delighted to welcome them to the munity Committee. 4 Hu m a n D im e n s io n s Events Calendar Visit us onlin e Key dates for human dimensions research Our online events calendar is a collection of the most important events in the research community. Find an appropriate venue to debut your findings, or have your event shared with our community of social scientists at: www. ihdp.org/article/calendar Human D imens i on s 4 April 21–23 May 13th Swiss Global Change Day RegioResources Conference An event to bring together the whole global change community to discuss ongoing transdisciplinary problems, scientific highlights and future research. The conference will establish a permanent cross-disciplinary dialogue on sustainability features in planning, decision and policymaking at multiple scales. 16 29–31 April May COST Workshop Adaptation futures The workshop focuses on Global Environmental Risk Governance under Conditions of Scientific Uncertainty: Legal, Political and Social Transformations. Showcasing cutting-edge international research, the conference will focus on equity, risk, learning, and finance for adaption. 18–20 17–20 April June Lund Conference on Earth System Governance Urban Environmental Pollution: Creating Healthy, Liveable Cities Organized by the Earth System Governance Project, to be the green governance event of 2012. The conference will explore the urban environment and how we can begin to create a healthy and liveable environment in cities. 15 20–22 May June Resilient Cities 2012 Rio+20 Conference 3rd World Congress on Cities and Adaptation to Climate Change, aimes to provide the keys to smarter infrastructure. The United Nations Conference on Sustainable Development will be the paramount event of the year. Aiming to secure renewed political commitment to sustainable development, the Green Economy is bound to take center stage of the high-level debates. Outcomes flowing from global change partners’ Planet Under Pressure 2012 conference, and the findings in IHDP’s upcoming Inclusive Wealth Report will inform what is likely to be a very heated discussion. 14–16 May REAL CORP 2012 “Remixing the city” is a challenge to manage and recombine the elements which make our modern cities in order to better respond to change. 5 I llu s trat ion Lo uise Sm ith INNOVATION 6 Hu m a n D im e n s io n s Feature Articl e he capitalist system has since its emergence as a dominant economic model faced scrutiny and scepticism, which has in many parts of the world reached a zenith in the wake of a global economic crisis and after decades of environmental degradation. Some would consider this dangerous environmental degradation an inevitable byproduct of capitalism,1 while others would argue that the economic system needs readjustments, but is not in essence, responsible.2 The recent oil spill in the Gulf of Mexico provided both sides with a would-be microcosm for the global contest between economic growth and ecological sustainability. Was it bad luck, inexcusable negligence, or an inherent consequence of the economic system? In recent years, the United Nations Environment Programme (UNEP) has developed the Green Economy Initiative as a response to growing con- Human D imens i on s cerns over the lack of advancement in the sustainable development agenda and its millennium development goals.3 This initiative aims at ensuring the social acceptance of a Green Economy that draws from new “green” technologies to secure economic growth. UNEP claims that a Green Economy will benefit everyone; however, in 1997, about 90 per cent of the “green” industries revenues and profits were located solely in North America.4 To fully understand the limitations of adopting and implementing UNEP’s Green Economy, one must first understand the broader role of technology in our societies. In his 2010 book Technics & Civilization5, Lewis Mumford distinguishes three interweaving phases in the history of industrialized technologies; the eotechnic, the paleotechnic and the neotechnic. The eotechnic period, from approximately 1000 to 1750 A.C.E., lifted some burden off slaves and work-labor by harvesting and transforming the powers found in natural resources such as water, wind, wood and glass. It gave rise to mechanical clocks, telescopes, affordable paper, prints and printing press, magnetic compasses and the scientific method, all of which have considerably altered and benefited our communities. The paradigm-shifting discoveries and inventions of the eotechnic period paved the way for the paleotechnic phase. The transition grew in Europe in the 1700’s, and culminated in the worst social 7 conditions since the Middle Ages around 1870 in England with a crisis exacerbated by the Iron Law of Wages and a vastly increased population. Mumford didn’t delineate the end of this period. Under this type of development, quantity rules over quality; economies of scale are possible; mines, mills, glassworks and industries thrive. He described this period to be bound by coal, iron and blood, and calling it “carboniferous capitalism”; for civi- “What is progress today but a collection of innovations as historical advancements?” lization was driven—and is, perhaps, still being driven—by carbon consumption. Nevertheless, a neotechnic phase has emerged out of the old barbarian industry. To carry the meaning of the unchanged rigidity of the economic system, Mumford adopts the term “pseudomorph” to convey the resilience of life that flows within. “We have merely used our new machines and energies to further processes which were begun under the auspices of capitalist and military enterprise: we have not yet utilized them to conquer these forms of enterprise and subdue them to more vital and humane purposes.” (Mumford, 2010: 265) Mumford understands the history of technology and machines to be intertwined, and he underlines the social and economic implications of these new instruments that convert energy to perform work, while being, unlike tools, partly automated. These non-organic agents either stretch and magnify the capacities of humans, or attempt to minimize the natural processes of life. For example, the all-pervasive technological advancement of the clock has transformed our relation to time: human lives and societies are now synchronized to mathematical measurements, rather than to the natural, celestial events that first gave it meaning. This ubiquitous technology has provided our economic civilization with obedience and predictability in workmanship, inherently benefiting a system where living humans become objectified labour.6 Interestingly, it can be ob- 8 served that anthropologically, we have bestowed economy and work with valuative norms. The search for immortality ranges between Calvin and Faust: work becomes a guideline for valuing the self, and transcendence is equated to profit within the omnipresent capitalist state.5, 7 As the business sector starts to deal with the invasion of ethics within a consumption-driven economy, its basis for existence is restated: innovation.8 Indeed, the World Business Council for Sustainable Development has reaffirmed its role in the development of new “improved” products, and the desire to influence consumer choice towards these newly created products, for the betterment of social and environmental issues. Although there can be a great deal of hope in this message, there is sanity in questioning whether the wish for technological innovations will indeed tackle the world’s major challenges for better, or for worse, considering the free market approach. Historically, many authors have made a point of this bond between technology and capitalism. For example, Joseph Schumpeter observed that capitalism fosters innovation regardless of whether it is a stated objective: “It is not the innovations that have created capitalism, but capitalism that has created the innovations needed for its existence,” he writes.9 As he further points out, “the development of wants, which we observe in reality, is a consequential creation of the economic development that has already been present. It is not its motor.”10 In this light, we must reassess wants in a greener economy, with preferences not as given—such as within the neoclassical economic paradigm—but as socially constructed.11 In his book Small Is Beautiful: Economics As If People Mattered12, Schumacher brings attention to the inability of the capitalist economy to ameliorate human welfare. He questions the relevance of the supremacy of technological advancement when it is linked to degradation rather than to the well-being of humans and their socio-ecosystems. In other words, the increases in production due to improved technology have created mountains of waste and hordes of unemployed people. The worth of individuals comes from their work of creating waste, and has led neither to happiness nor gratification, neither to equity nor to health.13 And should this ongoing economic development— green or otherwise—be seen as progress? What is progress today but a collection of innovations as historical advancements? The populist message of UNEP’s Green Economy evades the deeper and more troublesome questions of our economic system. Further, the question is begged: does the Hu m a n D im e n s io n s “green” in “Green Economy” entail little more than interests of the few? When Amartya Sen17 writes replacing brown products with “greener” substi- about development, he considers quality of life tutes? Is the crucial question of sustainability thus and living conditions to be chief points to sucaddressed, and if not, how should it be possible in cess. As development increases, one’s life should the context of growth-oriented economies on a fi- get richer in the broadest sense. The exercise of nite planet with an ever increasing population? freedom must be bound by a set of plural capabiliWilliam Stanley Jevons lived during the in- ties inherent to the political rights of democratic dustrial revolution—the “age of coal”. Being a keen participation. In other words, social exclusion, a observer of his time, he noticed that although coal dysfunctional education system, the absence of was considered the ultimate (and ever-abundant) social safety nets and acts of violence, are all signs commodity for energy, it soon became scarce, and of a profound misconception of development. the volatility of prices increased. In his writings, Why, then, is there an abundance of these charJevons raises questions of consumption in relation acteristics in the very same territory that is govto a finite good. Jevons’ most well-known contri- erned by the Green Economy industries? As Sen bution—the so-called “Jevon’s Paradox”—was his notes, economic growth may have helped tackle recognition that gains in efficiency due to tech- some of these social issues, yet it cannot sustain nology have the effect of increasing consumption, wealth for all; and, after all, economic growth is instead of reducing it.14 Logically, this increase in not an end in itself. How will green innovation fosconsumption corresponds to an increase in natu- ter not just economic growth but quality of life, ral resources depletion.15 Examples of the Jevons peace and fairness? How will green innovation and Paradox abound: in a research on the medieval the Green Economy foster equality? These are the economic shift from the subsistence agrarian questions that must be asked as we look to diseneconomy to the institutional arrangements by the gage ourselves from the paradigms of our current monastic orders, Fraser discusses how communi- existence, and make up for two centuries of shirkties were formed under the pressure to become ing our responsibilities to our environment, and more efficient.16 The economies of scale during to our future. — [D] this period gave birth to population and economic growth, and favoured innovation and techAndrea Hawkes Prof. Nicolas Kosoy nological advancement. Fraser elaborates how this new arrangement fostered vulnerability, exAndrea Hawkes is a dance artist Prof. Kosoy’s specialization is in the ploitation and power inequities, whose concern for the ecological field Ecological Economics, workthus promoting a macro-scale exand economical tragedies of our ing with National Governments to ample of the Jevons Paradox as a time has led her to obtain a bachelor internalise positive externalities result of the unlimited hunger for in agricultural sciences at McGill such as ecosystem services into their efficiency. As a species, humans University in 2011. Throughout her decision-making processes with must come to the realization that studies and professional life, Andrea particular emphasis on equity imthe entire neoclassical paradigm has found pertinence in cultivating plications of commodifying nature. needs to be replaced with a new sensibility and awareness of the in- Furthermore, he has been directly and congruent paradigm, which ner and outer worlds. While working involved in improving the capacity will enable our responsibility towith choreographers such as Dylan of developing country stakeholders wards a finite planet. Newcomb, Yasmine Hugonnet and in terms of the economic valuation Even as we question the exSonya Biernath, she experienced of ecosystem services. His research pense our society is prepared to the power of vulnerability. Her own interests comprise the study of ecopay in order to obtain technologchoreographic works, showed in nomic incentives for conserving naical improvements, the discusMontreal, Toronto, Sherbrooke and ture, the analysis of economic instision should rather focus on what Rotterdam, often depict the human tutions, environment and economic benefits innovation will actually character set by dramatic contexts. history, among many others. impart. Science, innovation and As a teacher in the dance departtechnics have a place in society, ment of CEGEP de Saint-Laurent, yet under which paradigm will her primary concern is to empower these thrive? Similarly, how is her students with consciousness, economic and political power goand the reality of interdependence. ing to be freed from the vested Human D imens i on s 9 Interview The Natural Economist Sir Partha Dasgupta of Cambridge University on the challenges of measuring the true costs and benefits of economic development. Interviewer Carmen Scherkenbach 10 Professor Dasgupta is the scientific chair of the Inclusive Wealth Report, a project by UNU-IHDP with support from UNEP, that seeks to provide with a more comprehensive indicator to measure the wealth of nations. See pages 15–17. other words, the value of the services we enjoy from Nature and the goods that we extract from Nature would be included in green accounts. D: Who will be the key actors and drivers in the transition towards such an economy? PD: The key actors are us—we citizens. In the aggregate we consume too much in the West, in a very wasteful, quite transparent manner. Our consumption patterns are also biased towards goods and services that make heavy use of Nature’s products. That’s because Nature is typically underpriced, usually priced at zero. We don’t pay for our use of Nature the way we pay for other goods and services. The irony is that manufactured goods are underpriced because Nature’s services that were put to use in their manufacture aren’t typically paid for. Those services should be taxed if there is no other means of ensuring payment for them. In Hu m a n D im e n s io n s P hoto Par tha D a sgup ta DIMENSIONS: Professor Dasgupta, how would you define the Green Economy in your own words? Prof. Sir Partha Dasgupta: By a “Green Economy” we mean an economy where Nature’s worth is included in the reckoning when people engage in economic transactions. That said, I am not at all comfortable with the expression “Green Economy”. It suggests special pleading on behalf of the environment, in a world where there should be no reason for special pleading. Any sensible society would regard Nature to be a scarce capital asset and would insist on including its value in economic calculations. But we are not sensible, so for the moment we need to flag that point and try to drive it home by talking of “green economies”. As an example of what national accounting in a Green Economy would look like, consider that every year national statisticians produce an account of the transactions that have taken place during the year—consumption, investment, sectorally broken up perhaps in investment in manufacturing, mining, agriculture, education and so forth. Currently, one big item that’s almost always missing in those accounts is the exploitation of Nature. Our dealings with Nature are not recorded. Green accounts would include those transactions. So, for example, in estimating aggregate investment undertaken in the economy, green accounts would include the DISinvestment that occurs when forests are depleted, when fisheries are damaged, when mangroves are destroyed, carbon is emitted, and so forth. In a Green Economy, governments would include the value of natural capital in arriving at public policies. For those forms of natural capital that make for the global commons—for example, the atmosphere and the open oceans—the drivers of a global Green Economy would be national governments themselves, spurred on by citizens to take action. For the management of global commons, there is really no other option but international cooperation. The transition to a green global economy has to involve the engagement of all levels of society, from households, right up to international organizations. D: Are there implementation barriers standing in the way of a transition? Do you think it is a question of technologies or rather of institutions, governments or nations? PD: Well, it has to be the latter. The reason is that technology doesn’t appear out of nowhere. Tech- Human D imens i on s nologies are discovered, invented and introduced into the market. The drivers of innovations are institutions, and that means the true drivers are the prevailing structure of incentives that people face. It’s sad that for hundreds of years the technologies that have been developed have been rapacious in their use of Nature’s services. And there is a very good reason for that: If you don’t pay for the use of natural capital, or at best pay very little, innovators are not going to economize on them, they will try and economize on the use of the expensive inputs. For example, if wages rise relative to the price of manufactured goods, new technologies can be relied upon to be more capital intensive. The flipside of the coin is that if Nature is very cheap, the technologies that entrepreneurs and inventors introduce can be predicted to be exploitative of Nature. We have driven ourselves into a corner by working with technologies that are extremely intensive 11 “I am not at all comfortable with the expression “Green Economy”. It suggests special pleading on behalf of the environment, in a world where there should be no reason for special pleading.” in the use of the natural capital. Looking into the future, societies need to steer their technologies towards those that are more economical in their reliance on natural capital. That can only happen if we pay for Nature’s services, but will require a big shift. Small changes won’t do because we are locked into a whole pattern of production and investment in knowledge which is exploitative of Nature. A few of us economists have been collaborating with ecologists in trying to understand the character of the “regime shifts” that will be required if societies are to become “green”. In 2003 my friend Karl-Goran Maler and I edited an entire symposium in the journal Environmental and Resource Economics on the subject of regime shifts. It contained contributions by ecologists and economists. I edited a second such symposium in the same journal in 2008. But progress in this is slow because the body of economic thinking is engaged in other issues. D: Is (per capita) GDP an adequate measurement for economic growth or will new matrices be needed? PD: GDP is inadequate and misleading. Most people who have warned us about the limitations of GDP as an index of economic well-being have pointed to its insensitivity to such ethical concerns as inequality. Quite obviously, GDP doesn’t 12 reflect the extent to which a society is unequal. But as an inter-temporal index of societal well-being, GDP suffers from a different, deeper weakness. It doesn’t account for the depreciation of capital assets. GDP stands for Gross Domestic Product, so the rogue word is “gross”. GDP doesn’t include the depreciation of capital assets that accompanies production and the passage of time. An economy could experience high growth rates in GDP even while the forests are being razed. Several countries that should know better are doing just that. Brazil is a good example of a country that’s destroying the Amazon at a rate that should be unbelievable, but isn’t. And Brazil is applauded regularly in such influential magazines as the Economist for its high GDP growth rate! The situation isn’t just ironic, it’s tragic. It is also very bad economics. There is a great deal of schizophrenia in economic writings. The Economist, for example, periodically publishes columns on this environmental tragedy or that, when they occur. In those same issues, though, the magazine can be relied upon to spend pages extolling the virtues of those economic policies that raise growth rates of GDP. Taken together, their analysis never adds up. Unfortunately, readers don’t seem to notice that. In any case, social tragedies are the wrong place to look for systemic societal errors. It’s like looking only for famines when studying the nutritional status of a population. If you do that, you miss out on persistent and possibly widespread malnutrition in the population. So, yes, we do need new measures to assess economic progress, but in fact we already have them. A number of us in the social sciences (Kenneth Arrow, Karl-Goran Maler, Kirk Hamilton at the World Bank, and I) have developed the required index. It’s an inclusive measure of wealth. We should be estimating the wealth of nations, not the GDP of nations. We have shown that societal well-being increases if and only if, relative to its population, an inclusive measure of that society’s wealth increases. By inclusive wealth I mean the sum total of the social worth of an economy’s entire stock of capital assets: manufactured capital, health and education, the science and technology base, and natural capital. But because the social worth of an economy’s capital assets depends not only on the prevailing and anticipated technologies and the capital base itself, but also on the economy’s social character, estimating wealth comprehensively would require the combined effort of experts in many disciplines: ecologists, demographers, economists, social statisticians, anthropologists and political scientists, among Hu m a n D im e n s io n s others. Recently, a number of us have tried to estimate movements in the (inclusive) wealth of nations in a number of countries. Understandably, perhaps, the estimates are woefully crude. But we should be patient. Even the GDP industry took decades to grow into the influential giant it is today. D: How do you see a Green Economy fit into the existing global trade system? PD: That’s a terrific question. I wouldn’t be able to give you a good answer if only because I’m not an expert on global trade; but let me try. Yes, it would have an impact on trade; more strongly, it should have an impact on trade, because we would want it to. If there are underpriced goods that have a large content of green stuff (natural capital) in them, a country that exports those goods in effect exports a certain amount of its wealth to the importing countries without being paid for it. It’s as though the exporting country cuts down its forests and gives them for free to the importing countries. From an exporting country’s point of view, that can’t be right. Of course, it is nice for the importers because they are getting goods on the cheap. Trade restriction is therefore desirable; for example, the imposition of green taxes in the exporting country. Yet, the moment you say “trade restriction”, experts on international trade start getting agitated. However, green taxes don’t amount to disowning free-trade, they amount to pricing goods and services in a desirable way. D: Can aspects such as new regulatory structures or government subsidies, cause countries to fall afoul of WTO obligations? Can a Green Economy lead to protectionism? PD: The problem with the WTO is that it doesn’t really want to understand green issues. The organization isn’t willing to be engaged in environmental issues except in the context of eco-labeling, perhaps. I can’t imagine that the WTO would disavow the arguments I am putting forward here. It’s just that they only pay lip service to green concerns, they don’t make it central to their engagement. We really need an overhaul of the international trading system, taking cognizance of the fact that there are huge chunks of every economy that are missing from national accounts; more broadly, missing from our economic calculations. But that’s just another way of saying we are not really paying for our use of natural capital. The world economy is subsidizing the use of natural capital on a massive scale, perhaps to the tune of 10–20 per cent of the market value of world output. Human D imens i on s Partha Dasgupta Professor Sir Partha Dasgupta is the Frank Ramsey Professor Emeritus of Economics at the University of Cambridge. He was formerly chairman of the scientific board of the Beijer International Institute of Ecological Economics of the Royal Swedish Academy of Sciences, as well as professor of economics and philosophy, and director of the Program in Ethics in Society at Stanford University. Since 2008 he has been Professorial Research Fellow at the University of Manchester. He is also the Andrew D. White Professor-at-Large at Cornell University and is currently President of the European Association of Environmental and Resource Economists. In addition to a number of honourary fellowships, Professor Dasgupta is a foreign associate of the U.S. National Academy of Sciences, and also a Fellow of the Royal Society and the British Academy. Professor Dasgupta has spent nearly most of his professional life working on poverty and inequality issues. His cutting-edge research covers welfare and development economics, the economics of technological change, population, environmental, and resource economics, game theory, and the economics of malnutrition. Much of his work has involved investigating the areas of sustainable development in which the interests of economics collide with ecological and social issues. An important area of his research has been the study of social capital—for instance, the degree of mutual trust and social networks that form a community. Having grown up in India, he brings a unique perspective to his field. Professor Dasgupta has also been invaluable to the cause of capacity-building among young scientists, especially in developing countries. In 2002, Professor Dasgupta was named Knight Bachelor by Her Majesty Queen Elizabeth II for services to economics. He has won numerous awards and prizes, including the 2002 Volvo Environment, the 2007 John Kenneth Galbraith Award of the American Agricultural Economics Association, and the 2011 Zayed International Environment Prize. Professor Dasgupta holds a B.Sc. (Hons.) in Physics from the University of Delhi, a B.A. (Hons.) in Mathematics and a Ph.D. in Economics, both from the University of Cambridge. He was born in Dhaka, Bangladesh (then in India). 13 D: Could you tell us about the most encouraging and most disappointing development of the Green Economy for you? PD: Well, you are asking questions that come pretty close to personal matters, because I take my work very personally. It’s hard to be detached from one’s work. I’ve been working on poverty, the environment and population for over 30 years, but haven’t had much impact on economic policy, nor on academic economics. The widespread depletion of natural capital, high population growth in poor countries, wasteful consumption in rich countries and the persistence of deep poverty in the world are tightly interconnected, or so I have concluded from my findings. But that work, much of it theoretical and so should be uncontroversial, has had very little effect on my fellow economists. They still work with GDP and believe that technological progress can be relied upon to make up for ecological damage. My work has had some impact on ecologists, though; they seem to take my work seriously; and I theirs. But that’s about it. Mainstream economics has been going in a different direction. That said, the shift to ecological concerns among economists shouldn’t be expected to take place within one generation; it can only happen gradually. There is far too much intellectual capital in eco- “The shift to ecological concerns among economists shouldn’t be expected to take place within one generation; it can only happen gradually. There is far too much intellectual capital in economic models that ignore natural capital, so the incentives are not right.” 14 nomic models that ignore natural capital, so the incentives are not right. One positive thing, although I don’t know if it is too early to say how productive it is going to be, is that some nations are beginning to taking green matters seriously. The Indian government is intending to create a system of green accounts later this decade, and a commission has been constituted by the Indian government. Its task is to suggest the method that should be deployed to reformulate, recreate national accounts. I was honoured to be asked to be chair of the committee. It’s an exciting venture for me, and very different from anything I have done so far. Another positive thing is that the young are pretty conscious of Human-Nature interactions— at least the young people I meet in England, in the United States, the Continent and in India. But I’m an academic economist, so I don’t have a feel for the way political movements evolve. I don’t have much understanding of it. But I do know that the fact that young people are concerned about Human-Nature interactions doesn’t mean it’s going to make governments take Nature seriously. There are also a number of very progressive NGOs focusing on green matters. However, there are problems even there. Enthusiasm for green matters can lead people to make statements that are overloaded, exaggerated or emotionally laden. There is nothing wrong with the latter—people are emotional about many other things; but when it comes to our dealings with Nature, emotionally-charged statements can misfire. You must have heard all those accusations leveled at “tree huggers”, “ecofreaks”, and “anti-progressives”. There is a cultural problem here, arising from an intellectual disconnection in the body populous. We all care about Nature but don’t want to hear uncomfortable facts about contemporary Human-Nature interactions. Because of the latter, we have lost decades. We should have learnt a good deal more about the character of Human-Nature interactions. For example, development activists, such as Oxfam and UNDP, have made population growth a taboo excepting in the context of “reproductive rights”. The organizations bang on about poverty, but are loath to study the phenomenon in ways they haven’t themselves been trained. As they are a powerful lobby, they are able to block progress. As a result, the populationpoverty-consumption-environment nexus remains a near-empty slot—in academia, politics, and the public. The socio-ecological pathways that make for human regress and progress are studied with biased lenses. That’s a great disappointment for me and should be for us all. — [D] Hu m a n D im e n s io n s Feature: Inclus i v e W e alth The Inclusive Wealth Report The IWR is an initiative of UNUIHDP with support from the United Nations Environment Programme (UNEP) and contributions from the UN-Water Decade Programme on Capacity Development (UNW-DPC) and the Natural Capital Project, Stanford University. The project aims at developing a comprehensive report on the wealth and changes in the wealth of nations, with a particular focus on natural capital. For decades, economists and governments have used conventional production indicators such as percapita Gross Domestic Product (GDP) or the Human Development Index (HDI) to measure societies’ overall “well-being”. Over the years, however, such indicators have proven to be insufficient: For instance, neither GDP/capita nor HDI reflect the state of the natural environment and both focus on the short term, with no indication of whether current wellbeing can be sustained. The report features Inclusive Wealth as a comprehensive measure to track societal well-being. It offers a capital approach to sustainability by measuring the changes in the capital assets worth of a nation, including natural, manufactured and human capital. The main objectives of the IWR are: • To carry out a comprehensive analysis of the different components of wealth by country and their link to economic development, particularly highlighting the importance of natural capital. • To provide with a measure to assess transitions towards a Green Economy. Changes in wealth should be the relevant criterion for assessing socio-economic planning in the context of the Green Economy. • To become an indicator of progress towards sustainable development with the production of bi-annual reports monitoring the well-being of countries. In the long-term, we expect Inclusive Wealth to become an important criterion in assessments of societal progress. • To formulate policies based on the notion of asset portfolio management. The ways in which nations manage their diverse assets and create productive economic bases for the future have critical implications for long-term sustainable development. The first Inclusive Wealth Report will be officially launched at a joint UNU-IHDP and UNEP side event at Rio+20 in June 2012. Preliminary findings will be presented at the Planet Under Pressure Conference in London, March 26-29, 2012. — [D] FIGURE 1: Percentage change in per capita wealth Brazil India Base year 1990 60% Base year 1995 200% 40% Produced Capital 150% 20% Human Capital 100% 0% 50% -20% Natural Capital 0% -40% IWI 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 -50% -60% GDP Figure 1 presents an overview of the changes in per capita wealth, including its three main components: human, manufactured and natural capital. GDP is additionally displayed as conventional measure of progress. Changes are presented having a fixed base year, in this case 1990. Results show that while the change in GDP per capita between 1990-2008 was 34% and 120% in Brazil and India respectively, Inclusive Wealth Index (IWI) had only an increase of 3% for Brazil and 9% for India. Even more, natural capital had a decline of 46% and 31% for Brazil and India accordingly. These negative trends were however offset by the building of produced and human capital in both countries. Human D imens i on s 15 Feature: Inclusive W e alth What’s in our countries’ coffers? The Inclusive Wealth Index goes beyond the conventional captial measures to provide a comprehensive picture of the wealth of nations. Human Capital Education Natural Capital Cropland Pasture Land Forests Minerals To truly measure wealth we need to incorporate more than just produced capital into the equation. The Inclusive Wealth Index adds the value of human capital, natural capital, and ideally, social capital into the calculation. Presenting a comprehensive insight into the wealth of nations the index considers the various capital assets that create and sustain the needs of present and future generations over time. 16 Produced Capital Machinery/Equipment Buildings and Structures Hu m a n D im e n s io n s I llu s tr at ion/ Photo Lo uise Sm ith Fossil Fuels Human D imens i on s 17 Feature Article Green Growth & Innovation up.1 2 3 4 Such economic convergence is assumed to be mirrored in environmental convergence, measured by the resource- and pollution-intensity of national economies. This is captured in the Environmental Kuznets Curve hypothesis5 6 which argues that there is a relationship between income per capita and environmental quality at the national level. The end result for latecomer countries that succeed in catching-up would be patterns of resource- and pollution-intensity equivalent to high-income countries. Such models of economic and social change, and the predictions that flow from them, have led to growing academic and policy interest in alternative growth models that could lead to a faster transition to more resource-efficient and low-pollution development pathways in latecomer countries (so tunnelling through the Kuznets Curve). This would generate social benefits, for instance by reducing health costs associated with environmental pollution, economic benefits by lowering the resource intensity and costs of development, while also forming the basis for modernisation and growth through the creation of new industries and leading sectors. It is clear that technological innovation and capability-building will play a key part in generating and anchoring new, more sustainable production and consumption in latecomer countries. Home-grown technology and innovation in the developing world are key to achieving sustainable growth. Frans Berkhout Two key themes at this year’s Rio+20 United Nations Conference on Sustainable Development in Brazil are the Green Economy and green growth. Several weighty reports have been published in recent months in the run-up to the conference. One observation is that these reports actually say very little about green economic growth, in the sense of changes in the structure and quality of economic activity through time. It seems clear that greener growth will be based on new technologies, industries and behaviours, and that an analysis of green economies therefore needs to be concerned with how a radical reshaping of current “brown” economies might take place. Research about such sustainability transitions was at the heart of IHDP’s Industrial Transformation (IT) project (1999–2010). In its final phase, the IT project was especially concerned with the question of sustainability transitions in rapidly-growing economies in Asia, with lessons for Latin America and Africa. Growth and development Urbanization and growth in emerging economies in Asia, Latin America and Africa have major implications for global sustainability. These rapidly-growing economies generate large new demands for natural resources and are making major contributions to global environmental problems, including climate change. Conventional models of development suggest that demand for resources and the pressure of pollution will continue to grow for the foreseeable future. These models hold that growth occurs through a series of stages, eventually leading to long-run convergence with developed economies in their economic structure, rates of growth and productivity—the process of catch- 18 The theoretical challenge But the analytical task is complex, and it turns around three rather different questions. First, is what we have termed environmental convergence inevitable? Second, what economic or other factors could explain such non-convergence? And third, are these factors a feature of economic, social and institutional development of latecomer countries? In essence, the question of environmental convergence is related to the question of whether economic growth is coupled (or not) to resource consumption and environmental pollution. If growth can be decoupled from resource-use and pollution, then there need be no environmental convergence across countries. Latecomer countries would then achieve economic convergence in terms of their productivity, structure and income per capita, but having followed a very different resource- and pollution-pathway. Typically, technological capabili- Hu m a n D im e n s io n s ties and innovation are viewed as key intervening factors in enabling such decoupling and so avoiding environmental convergence. But if innovation plays this role in avoiding environmental convergence, conventional growth models would predict that it would originate in developed, high-income countries and be transferred to latecomer countries through trade and investment. In other words, the source of technology—the key factor which might enable decoupling—is exogenous to developing countries. The main reason is that firms in latecomer countries are not viewed as having the capacity to generate, innovate and diffuse new technologies. What Abramovitz called “social capabilities” to absorb technology, attract capital and participate in global markets need to be built up in these countries before firms can be in a position to move from imitation to innovation. Theoretically, this holds for environmental technologies, as for all other technologies. But this line of argument generates another bind. If countries are dependent on external sources of technology and primarily concerned with absorption and imitation, then the opportunities for decoupling may be limited, at least until later in the process of development, once innovative capabilities, regulations and markets have been built-up. The preliminary investments made by firms in capability-building and imitation, and of governments in the necessary institutional settings for innovation, appear to tie latecomers into economic, as well as environmental convergence with more advanced countries. Theoretically therefore, latecomer countries appear destined to follow the same paths as countries that have gone before them, with economic and environmental convergence locked together. Escaping the bind of “environmental convergence” In the IT project we explored whether innovation and learning occurring in lateindustrializing countries could contribute to environmental decoupling and therefore to more sustainable development pathways, starting early in the development process. The project was interested in alternative, endogenous sources of innovation that, set in the context of transnational flows of knowledge and technology, could act to drive environmental decoupling early in development. The IT project has shown that there is widespread evidence of innovative activities in latecomer Human D imens i on s 19 Frans Berkhout is Professor of Innovation and Sustainability, and Director of the Institute for Environmental Studies (IVM) and the Amsterdam Global Change Institute, both at the VU University in Amsterdam, The Netherlands. Until 2004 he was with SPRU (Science and Technology Policy Research), University of Sussex (UK). He holds a Geography BSc (University of Leeds, 1983) and a PhD in Science and Technology Policy Studies (University of Sussex, 1989). He did post-doctoral research at Princeton University (US). Among other advisory roles, Professor Berkhout will be a lead author in the IPCC’s Fifth Assessment Report (2013/14). Professor Berkhout has extensive research, management and research training experience across a number of fields. His early research was concerned with the economic, political and security aspects of the nuclear fuel cycle and radioactive waste management. His more recent work has been concerned with technology, policy and sustainability, with a specific focus on climate policy. countries that have the potential for generating radically new ways of providing for energy, mobility, nutrition and shelter. 7 8 9 10 11 12 13 Unexplained by conventional theory, these innovative activities present a source of innovation that is endogenous to latecomer countries at early stages of catchingup. If these innovations lead to the creation of novel, more sustainable technologies that diffuse widely, an alternative source of innovation will have been unearthed, calling into question the dogma of environmental convergence. The IT work drew particular attention to the role of “sustainability experiments” in developing Asian contexts. We defined sustainability experiments as planned initiatives that embody a highly novel socio-technical configuration likely to lead to substantial (environmental) sustainability gains. Such experiments play a major role in “system innovation” in socio-technical regimes in all social and economic contexts. Regimes constitute the social, institutional and technological fabric within which economic activity takes place. Change in socio-technical regimes is fundamental to structural change in economies. Such regimes are complex aggregations of technologies, rules, practices and norms, generally exhibiting strong inertia and path dependency. Change occurs over the long-term, and includes interacting processes of social, institutional and technological learning and change; hence a discussion of socio-technical, rather than just technical, change. Perspectives on green growth in latecomer countries By the completion of the IT project in 2010, its research had begun to demonstrate a number of important features of radical, sustainable socio- 20 technical innovation in emerging economies. First, actor networks in sustainability experiments are heterogeneous in composition, including private, public and civil society actors. This finding points to a broader, more socially-embedded model of innovation. Second, regimes and landscapes are relatively fluid in emerging economies and societies, rather than stable. This both creates space for innovation, as well as generates uncertainties. Third, learning and technology diffusion between experiments, niches and regimes face multiple institutional barriers. Such barriers are a general feature of system innovation in which new rules of the game are often necessary. The question is whether institutional change is different in rapidly-developing contexts. Fourth, we are only just beginning to understand how global knowledge linkages influence the development and growth of sustainability experiments and niches. These linkages are crucial in freeing growth theory from the nationally-based analysis of innovation systems that appears so central to the notion of environmental convergence. We need to see experiments as located within transnational flows of knowledge, technology and other resources. And we assume that these flows influence local capability development, stimulating the later growth of firms and new industrial sectors. Policy implications Much of the current debate about green growth is still locked in a paradigm of catch-up, north–south transfers of technology and the management of intellectual property. This may have reflected the state of the world in 1992, but twenty years later and looking forward, the challenges are different. The challenge in 2012 is to look for new organizational contexts within which technological and innovative capabilities are being generated within and outside business firms, eventually to become embodied in new markets and practices. These may include networks of private and public sector actors, such as those we now see cooperating in sustainability experiments. Such experiments, and the heterogeneity of the actor networks which constitute them, are flourishing across different sectors (including energy, food and agriculture, and urban planning) in industrialized as well as late-industrializing countries. Fa- Hu m a n D im e n s io n s C artoon Lo uise Smith Frans Berkhout cilitating and supporting the emergence of these new socio-technical configurations and the hybrid innovation systems they constitute should be a key focus of green growth policies. While many system innovation studies originate from an analysis of the stickiness of incumbent socio-technical regimes and the need to bring fluidity into them to create space for innovation, under conditions of rapid economic and social change things may be less sticky. Under such conditions, regimes and landscapes may be incomplete, or in a state of rapid flux, offering multiple spaces for novelty and innovation, while also contributing to uncertainties that serve to limit learning, investment and diffusion. Such uncertainties may be compounded by failures in governance. For instance, a critical uncertainty around many highly novel innovations is barriers to market entry. The capacity of regulators to generate new rules is critical to the innovation and diffusion process. Finding ways of dealing with institutional uncertainties in emerging green innovation systems will be a crucial task for policy. Finally, local and global knowledge and technology linkages are fundamental to the accumulation of green technologies and capabilities, whether in developing or developed country contexts. Such links may exist through direct or indirect relationships with foreign technical experts, overseas development assistance and foreign suppliers of technology. The relationships may be more reciprocal than often assumed in the literature on catching-up, with producers in industrializing countries becoming producers as well as takers of knowledge and technology. Biofuels in Brazil, and wind and solar photovoltaics in China are good examples of worldleading technological capabilities being established in non-OECD countries. — [D] D imensions Ca rtoon On the day the Green Economy finally arrives. Human D imens i on s 21 Photo Series 22 Hu m a n D im e n s io n s Human D imens i on s 23 P Hoto Wa lm art White Walmart’s white roofs help reduce energy use and have a lower heat island effect than a darker roofing color. The skylights are part of the company’s daylight harvesting system, which can save an average of 800,000 kWh of energy annually. 24 Hu m a n D im e n s io n s Human D imens i on s 25 P hoto (R ED) Thi nkGe oEnerg y P hoto (purp le) Pew ar i Red Bjarnarflag Geothermal Power Plant in the North of Iceland uses steam from the Námafjall geothermal field to produce 3MW of electrical energy from one small steam turbine. Steam from this geothermal field is also used for district heating in the area and for the Kísiliðjan Diatomite Plant. 26 Hu m a n D im e n s io n s Purple Farmers in Tanzania dye chickens purple (safely) to prevent them from being attacked and eaten by hawks—a method which allows for sustainable, free-range chicken farming through simple innovation. Human D imens i on s 27 Orange The HarvestPlus* Maize Team uses biofortification to improve the nutritional value of maize by adding beta-carotene, which the human body converts to Vitamin A. Millions of people lack Vitamin A in their diets, leading to numerous disabilities, including blindness. *HarvestPlus is a programme of the Consultative Group on International Agricultural Research (CGIAR), a World Bank-based consortium of 15 research centres worldwide devoted to enhancing agricultural productivity, par- Photo Har vestPlu s ticularly in developing countries. 28 Hu m a n D im e n s io n s Human D imens i on s 29 P hoto Wo rl d B an k 30 Hu m a n D im e n s io n s Silver Children assemble in their school courtyard in Gansu Province, China, where a solar panel disc heats a kettle. Solar power is a versatile, renewable way of powering everything from cars to water heaters, fountains, buildings and satellites. Human D imens i on s 31 P hoto (b lue) Craig A . Rodw ay Photo ( ye llow ) BA SF Blue Dutch artist Daan Roosegaarde’s Dune, now permanently installed in Rotterdam, is an astonishing hybrid of nature and technology: a sustainable artwork using no more power than a single 60watt lightbulb. The visitor passes along a densely-planted row of illuminated “flowers”, triggering light and sound by his or her movement. 32 Hu m a n D im e n s io n s Yellow To help farmers keep fast-growing wild plants away from crops in an environmentally compatible way, BASF experts have developed a herbicide which contains the active ingredient pendimethalin enclosed in a microcapsule. The capsules only settle where they are needed: on the leaves of the weed or on the earth. Another advantage of the polymer capsules: the bright yellow active ingredient doesn’t dye the field anymore. Human D imens i on s 33 P hoto S ara h Macca ns Brown Coffee is the second largest commodity trade after oil, with 2.25 billion cups consumed around the world everyday, and its production involving some 25 million farmers. A number of initiatives seek sustainability along the entire coffee supply chain “from farm to cup,” helping to bridge the gap between certified sustainable coffee farms and consumers across the globe. 34 Hu m a n D im e n s io n s Human D imens i on s 35 Pro fi les Green Economy Writing Contest We invited young scholars to take part in a scientific writing contest and have their work published in this first issue of Dimensions. 36 P hoto (rig ht ) Lo uise Sm ith P hoto (le f t ) pro vided by the Aut h o rs With the focus on the human dimensions of the Green Economy and societal transformations in mind, participants were asked to consider political, technological, economic or social components, e.g. equity, inclusiveness, and the compatibility of these transformations with social, cultural and political values. The submitted articles could focus on, but were not limited to, new technologies, changes to the design of markets, social changes, including the adoption of different lifestyles, potential implementation barriers, the long-run feasibility of present high economic growth rates, or alternative development pathways for a transition towards a Green Economy. They were also asked for their writing to be directed towards a wider audience, including non-scientists interested in the topic. The contest was open to young scholars from all over the world, while those from developing countries were particularly encouraged to take part. Judges were able to select three winners to be awarded a cash prize. Information on the winners and their submitted work are featured on the following pages. — [D] Hu m a n D im e n s io n s 1 About the Winners 2 3 First Place Joy Merwin Monteiro Joy Merwin Monteiro has an undergraduate degree in Electronics and Communication Engineering, follow- S ec on d Place Th ird Place ing which he completed two Master’s Andrew Fanning Amandeep Kaur and another in Climate Science. He is Born in 1984, Andrew Fanning holds Amandeep Kaur was born in New Del- currently a PhD student at the Centre dual citizenship in Canada and Guy- hi, India in 1987. She holds a Bachelors for Atmospheric and Oceanic Sciences ana. He is a Masters in Development of Arts in Mathematics with Honours at the Indian Institute of Science, Economics candidate at Dalhousie from Lady Shri Ram College for Wom- Bangalore, India. He sincerely hopes University, Halifax, and is currently en, University of Delhi and has gained this will be his final academic degree. conducting his thesis research in experience working for a consultancy Having the privilege to live in a soci- Uruguay focused on the challenges firm. Herein, she worked in a variety ety where two civilizations, one mod- and limitations of estimating the lo- of industries across different verti- ern and another ancient, exist side cal monetary costs (and benefits) of cals doing consulting assignments in by side, Joy is fascinated by the way climate change in coastal ecosys- different fields. Amandeep interned they interact with each other, thereby tems, with support from the Interna- with Ernst and Young, Business Advi- showing each other’s strengths and tional Development Research Centre sory Team, Human Capital during the weaknesses. He hopes there are les- (IDRC). Andrew’s research interests spring and summer of 2011. She also sons to be learnt from both, which will fall broadly within the interdisciplin- completed a Master of Business Laws contribute to the building of a more ary concept of “ecologically sustain- from the National Law School of India sensitive people. To this end, one of able economic development”, par- University, Bangalore and is currently his pastimes is to try and understand ticularly as related to climate change pursuing her MBA in Human Resource the implications of this interaction adaptation in coastal zones. He is Management from MDI, Gurgaon, of civilizations on material, social, also interested in rebound/backfire where she is among the top 5 per cent economic and philosophical planes. effects from energy efficiency im- students. In her free time, Amandeep His other pastimes tend to revolve provements and their implications likes to read, write poems and stories around music, sport and sleeping. for climate policy. and volunteer in community outreach. degrees, one in ICT for development Human D imens i on s 37 W ri ti ng Contest • F i r s t Plac e W i n n e r The Moral Universe I llu s trat ion Lo uise Sm ith Joy Merwin Monteiro 38 Hu m a n D im e n s io n s E nergy is a fundamental necessity for life, let alone a vigorous society or civilization. This fact has been recognized by humans for a very long time—Sun, Wind, Fire and Water (in the form of rivers and waterfalls and rain), worshipped by most cultures, are manifestations of energy in one form or the other. The main difference between pre-industrial times and the present day is that we have restricted our worship only to Fire, neglecting the others almost entirely. Why this became the case, and as humanity again pays due attention to the other Gods again, what entities must again return into our moral equations, is what this essay tries to describe. Sun, Wind and Water are by nature non-constant but rhythmic entities. The sun is up every day, but disappears during the night, winds change according to seasons, some rivers dry up in the summer and others flood during the rains and nobody still understands perfectly how the rains come and go. Other important aspects of these sources of energy are that they are diffuse and not easy to store. Sunlight, wind and flowing water cannot be stored by themselves, but must be converted to some other form which can be stored. Such entities are normally called “fluxes”, and they are the most natural form in which energy is present around us. Even the purest form of energy that we know, electricity, is a flux and has to be converted to chemical energy in batteries before it can be stored. The fact that these sources were hard to handle and diffuse (or not concentrated) was counterbalanced by the fact that they are for all practical purposes eternal. A European sailor planning to come to India to trade had to plan his visit to catch the monsoon winds, but he did not need to fear that these winds would stop some day. If today is cloudy, you can sun-dry your vegetables tomorrow. Pre-industrial society’s entire existence revolved around recognizing this variability and developing means to “harvest” this energy. Economic, social and cultural activity revolved around this ebb and flow of energy. Agriculture, wind/water mills were among the primary methods of harvesting this flux of energy, converting it into stocks of energy (in food grains) or using it immediately. The main issue with these Gods, as mentioned above, is that they are quite moody. Thus, those human activities that had to happen without break, everyday, like cooking for example, could not depend on them. It was Fire that came to our rescue. Before moving onto the miracle of fire, it is necessary to analyse the moral universe of a person in a pre-industrial society. By necessity, a lot of objects in the world needed to be Human D imens i on s 39 “The rhythms of nature which manifest themselves in the movement of the sun, the seasons, flowering of plants, migration of animals, fruiting of trees were very important. Any activity that did not fit into this rhythm incorporated into her moral decision-making, the way she would decide something was “good” or “bad”. The rhythms of nature which manifest themselves in the movement of the sun, the seasons, flowering of plants, migration of animals, fruiting of trees were very important. Any activity that did not fit into this rhythm was not desirable. Restrictions on grazing, fishing, hunting, leaving land fallow, plucking flowers and fruits at certain times in the year are all indicators of the consciousness that humans depend to a very large extent on natural cycles over which they have no control. Therefore, any decision on the goodness or badness of any activity depended on the season, the time and the natural environment we found ourselves in. This was not due to altruism or an abstract love for nature, but due to sheer necessity. Fire is unlike others in this pantheon. Rather than being energy in itself, it is a signature of a source of energy. Not only that, it indicates the presence of a highly concentrated source of energy. Sunlight in itself cannot become fire, but when concentrated through a lens or a mirror, it can become a very destructive fire as Archimedes discovered. Fire also yields easily to his worshippers, you can switch him on and off at will, once you have mastered the art. Therefore, it was but natural that those human activities that required constancy were built upon the foundation of fire. As long as there was fuel available, fire was there, regardless of time, region or season. It is therefore not surprising that Prometheus, the one who gave fire to mankind in Greek mythology, is treated as a great champion of mankind. If Gods are defined to be the masters of humanity, then fire, in giving us greater control over our own destiny, made us Gods. The fundamental reason for this capacity of fire is that it depends on stocks of energy already stored and not the eternal fluxes that surround us at all times. As humanity grew from being primarily agricultural to also indulging in trade and commerce, the prominence of fire grew very rapidly. The reason for this lies in the very nature of trade and commerce—it is the movement of things, people, ideas and cultures and all movement requires energy in one form or the other. Controlling trade to some extent means controlling the energy that drives it. For this reason, initial trade (and, by implication, industry) was driven by animal and human (slave) 40 Hu m a n D im e n s io n s I llu s tr at ion Lo uise Smit h was not desirable.” power, firewood and sail boats. Mankind was making the move from harvesting energy to “mining” it from forests, animals and other, more unfortunate humans. From the point of view of the enterprising businessman or trader, constant movement (of something or other) was required—movement implied trade and trade implied profit. Not only was constancy attractive to the trader, but also to every section of humanity: constancy implied security and it increased the natural capacity of humans to build upon their ancestor’s work. In this sense, it is a hallmark of civilization itself. This demand for constancy was at odds with what we had to work with—seasonal winds, disobedient labourers, lazy slaves and rapidly depleting forests which simply did not grow back as fast as we wanted. It is from this point of view that the shift to coal (and later to oil) must be seen. It reduced the necessity to include the multitude of objects that previously entered our moral equations. Mankind could finally look inward and achieve magnificent progress without too many worries about what was happening in the non-human world. This was the era in which both the pessimists and the optimists, when discussing the future of the world, were simply discussing the future of the human species. Nature did not matter, for sooner or later we would completely conquer it anyway. Fossil fuel-based transport, electricity to drive industries and homes, pesticides and fertilizers, which made agriculture less of a gamble, all combined together to provide the constancy we wanted and ensured a period of unparalleled prosperity and population growth. A mining civilization had more or less replaced the harvesting one. Fire was now our one and true God. With fire came a profound shift in the way we worked and viewed the world. Farmers who could previously grow certain crops only at certain times of the year, could now grow them all around the year. People who previously aligned work and leisure with the sun and seasons now relied on casual leave, medical leave and government holidays. We began to work all year round, eat strawberries all year round and live in houses that were maintained at 27�C all year round. Corporations set up branches all over the world, so that the sun never set on their empires, forcing people to stay awake when they are supposed to sleep and vice-versa. Like the Red Queen in Alice in Wonderland, we had to keep running to stay in the same place. Constancy was showing us that it was not all great, after all. It is therefore not surprising that, gradually, what was “good” and “bad” was decided by taking ever fewer objects into consideration, the logical conclusion of which came to be enshrined in the Homo economicus. To be fair, a life driven by coal and oil does not provide one with the time to do otherwise. Nothing but a severe jolt to the sensibility of humans could shake them out of their breathless but optimistic race towards an ever-receding perfection. One by one, every resource that humanity has mined over the past few hundred years has either withered away or stood up in revolt. The first signs came when the humans being mined for their energy and skill revolted under the banners of com- Human D imens i on s 41 the way we worked and world.” 42 munism and socialism. The frenetic movement that characterises our viewed the era moved diseases, plants and animals to places where they were not known, not always with good results. Agriculture is currently under siege by stubborn insects that simply refuse to be eradicated, no matter what is thrown at them. The oceans are nearly empty of fish, and the sky full of gases which threaten to heat our planet beyond the capacities of our best air-conditioners. When you play with fire, it is unlikely you won’t get burnt. Slowly but surely, and somewhat reluctantly, humanity is beginning to realize that an inward looking civilization simply cannot survive forever. Those unsightly trees and insects will always have to be part of our culture, no matter what we do. The first few steps towards this consciousness have been taken (somewhat ironically) by identifying the rhythms of the Sun, Wind, Water and Life itself. Scientists are mapping out what are the best places to harvest solar energy, what areas of the world have high wind energy potential, hydroelectric potential and what places have large biodiversity. Modifying crops to suit local circumstances, using biological control for pests, understanding the response of ecosystems to our activities are under way. In essence, what was known before and conveniently forgotten, is being painfully relearnt in a more “scientific” manner. Our moral universe is slowly but surely being reclaimed from the wasteland to which it was condemned for the past few hundred years. However, as we are making this shift, a very fundamental contradiction arises—our civilization, still predominantly a mining one, wants to be driven by technologies that belong to a harvesting civilization. We demand the constancy that we have been used to for many generations, and which we idolize as the epitome of civilization, but we hope this constancy will be driven by technologies that are moody, uncontrollable and unanswerable to anyone. This contradiction is manifesting itself in many contemporary debates and concerns: Can organic farming feed the world as it is designed today? How can solar thermal plants run round the clock? How can we design an electricity grid that is smart enough to provide constant power supply when connected to solar and wind installations? How can we design newer batteries and fuel cells to shelter us against the vagaries of the Sun, Wind and Water? What are the “sustainable” pollution levels that our skies and oceans can tolerate? That we can go back to a completely harvesting society is a pipe dream, similar to the nineteenth century dreams of infinite progress and complete social equality. But it is equally apparent that unless our moral decision-making does not encompass at least a larger part of our natural and social environments, we cannot achieve what we cherish and aspire toward. The energy industry has always sought to modify consumer behaviour through prices. However, given that the largest consumers are those that are also the most affluent, it is questionable how effective this strategy will be in the future. It is unlikely that a person living in a house with an A/C, goes to work in an office Hu m a n D im e n s io n s I l lu s t ration L ou is e Smi th “With fire came a profound shift in “Our moral universe must not be one forged in Fire, but also kissed by the Sun and caressed by the Winds and Water.” with an A/C and travels in a car with an A/C will even relate to the symptoms of global warming. Moral decision-making must include a notion of duties towards other beings, human, non-human and even non-living. Some actions must be performed simply because we consider them to be our duty towards others. Our moral universe must not be one forged in Fire, but also kissed by the Sun and caressed by the Winds and Water. Most importantly, as these elements come together in the glorious phenomenon called Life, the survival and prosperity of all life must be embodied within our notions of justice. Our happiness and survival depend on an intricate web of causality that encompasses everything from simple molecules to the well-being of the vast oceans. May it never be thought of otherwise. — [D] Human D imens i on s 43 44 Hu m a n D im e n s io n s I llu s trat ion an d Photo L ou is e Smi th Writing Cont es t • S ec on d Plac e W i n n e r Economics, growth and energy in the Green Economy Neoclassical theory can no longer frame our perspectives for a sustainable economic future. Andrew Fanning T he term “Green Economy” has gained remarkable resonance over the past few years, including recent mention in the UN General Assembly as “a means to achieving the end of sustainable development”.1 There are high hopes that a transition to a Green Economy will put human beings on track to avoid the worst of anthropogenic climate change, and reverse accelerating rates of global biodiversity loss, to name just a few examples—the tip of the (melting) iceberg—of our present ecological woes. Much of the debate on the Green Economy is focused on the human dimensions of transition and especially on attempts to estimate the costs and benefits (in monetary terms) of a “low carbon, resource efficient and socially inclusive”2 Human D imens i on s economy. Numerous authors have pointed out the deficiencies of neoclassical economic models in accounting for the parts of life that lie beyond the market in both the social and environmental arenas. Some fundamental structural reforms far beyond any public policy/discourse to date are outlined if current and future generations are to enjoy a similar or improved quality of life to the levels enjoyed today. Environmental quality: a “normal” good or just plain good? Neoclassical economic theory determines the optimal allocation of a given good in a market through the equilibrium quantity of demand and 45 Linear throughput of energy driving the conventional circular flow of exchange Available Energy The Ecosphere Degraded and Dissipated Energy/Matter (Waste) Low Entropy High Entropy Goods & Services Spending on Goods & Services Businesses The Economy Households Wages, Salaries, etc. Labour & Investment supply governed by the circular flow of exchange between households and firms. It is the dominant economic model used to shape the laws governing current economic activities and is based upon three central assumptions: i) people have rational preferences among outcomes; ii) individuals maximize utility and firms maximize profits; and iii) people act in their own self-interest on the basis of complete information.3 Contemporary branches of economic thought concerning consumers, producers, welfare, labour, the environment, etc. are built upon these assumptions which have also led to many critiques of conclusions based upon the simplistic behaviour of Homo economicus. In cases of market failure, mainstream economists often see a role for government intervention as a means to correct the inefficient market allocation of the good in question. For environmental economists, market failure occurs when: i) there are negative externalities to production (e.g. pollution); ii) the environmental “good” is non-exclusive and/or non-rival (e.g. public goods); and iii) there is uncertainty surrounding environmental decisions (incomplete information). At the same time, government policies are 46 also widely recognized for providing incentives to pursue environmentally damaging production, known as policy failure.4 To address externalities, much work has gone into developing monetary-based valuation tools to quantify the costs borne by society of a particular economic activity that are not paid for in the production process. However, conceptual and methodological challenges remain related to the valuation of non-market ecosystem goods and services, particularly stated preference methodologies.5 6 7 To address market failure from open access goods, the standard prescription of environmental economics is to enforce property rights through government intervention on the natural resource in question.8 However, it can be completely rational for a profit-maximizing firm to liquidate a renewable resource with a low regeneration rate and then reinvest the funds into something more profitable.9 As well, conventional economics is completely silent with respect to evidence of community-led sustainable selfgovernance regimes based on mutual trust that effectively avoid “the tragedy of the commons”.10 Hu m a n D im e n s io n s Ecological Economics: beyond price-based tools Ecological Economics represents an interdisciplinary attempt for researchers to come together in order to explore new ways of thinking and acting in the face of growing environmental degradation caused by the current status quo.11 A starting point of departure from mainstream economic theory is the expansion of the circular flow of exchange between households and firms to include the environmental throughput of: i) materials and high-quality energy (solar) as inputs; and ii) wastes and low-quality energy (heat) as outputs (Figure 1).12 This intuitive modification shows that the economy is a subsystem of the finite ecosphere thus undermining the neoclassical view that the dominant actors in an economy are firms and households that can be analysed separately from the environment. By analysing throughput, ecological economists show that the “perpetual motion machine” of the mainstream model ignores thermodynamic laws stating that subsystems maintain out-of-equilibrium order (survive) at the expense of the continuous consumption and dissipation of available energy/materials from their host environment.13 14 15 Ecological economists, like mainstream economists, have also developed quantitative tools to measure the human impact on the environment. The major difference is the units of measurement: ecological economists design their tools in the units of the “host organism” (e.g. the ecosphere) arguing that the monetary units of the “subsystem” (e.g. the economy) are incapable of accurately measuring the greater whole. Biophysical accounting tools also suffer from conceptual and methodological challenges.16 One of the criticisms against their effectiveness for policymakers lies ironically in their avoidance of monetary units given that national governments and the international organizations that unite them are currently structured according to the market-based assumptions of mainstream economics. Contrasting concepts of sustainability Neoclassical economic models often imply perfect substitution between the various forms of capital (e.g. that they are equally valuable) so that their criteria for sustainability rests on maintaining total net capital stocks.17 According to this logic, if Country A degrades their environment but replaces the monetary value of natural capital stock lost Human D imens i on s “A starting point of departure from mainstream economic theory is the expansion of the circular flow of exchange between households and firms to include the environmental throughput.” with manufacturing capital stock, so that flows of total output remain the same (or increase), then Country A is behaving sustainably. In the literature, this stance is labelled “weak” sustainability. In contrast, a “strong” sustainability perspective holds that natural capital stocks are not perfectly substitutable and should be accounted for apart from other forms of capital. This implies that Country A was not behaving sustainably if natural capital stocks decrease regardless of the effect on manufacturing capital stocks and total output flows. Let us now explore one of the most important contributions to our currently unsustainable path (weak or strong) for both capital stock depletion and especially over-shooting the assimilative capacity of the biosphere: energy use. Factoring Energy Use Into Production Energy consumption increased by a factor of sixteen during the twentieth century.18 In mainstream economics, energy, if counted at all, is typically assigned a low factor share in the production process (~5–6 per cent) despite its intuitive importance in daily life and the observation that four of the top five 47 most profitable companies in the world at the time of writing are energy-exploiting companies.19 Relaxing assumptions: energy and growth in Ecological Economics Energy and growth in mainstream Economics Intuitively, it does not appear probable that the factor share of production allocated to energy could be a mere ~5 per cent despite assurances from mainstream economists that this is the case. A number of ecological economists have used energy to refute a fundamental assumption of neoclassical economics while providing compelling empirical analyses that eliminate virtually all of the unexplained Solow residual.24 25 26 27 28 These approaches to economic growth and energy use emphasizing the physical production process rather than the market-based exchange emphasis dependent on human behaviour of mainstream economics. Taking this view, the neoclassical assumption of equality between factor costs (derived in market equilibria) and their shares in production (derived through thermodynamic transformation laws) can be relaxed. In effect, production processes are a function of the physical “work” required to transform input materials into their final form for consumption subject to the same physical laws that govern all work processes. The important aspect of these ecological economists’ work is to demonstrate, using biophysically-consistent theory and empirics, that the factor share of energy is typically a magnitude greater than its share allocated by conventional economic analysis. Similarly, labour is typically allocated a much greater share in conventional analyses (due to its high cost) than these biophysical analyses suggest. Economic growth, it seems, has largely been a product of the increasing substitution of expensive, weak labour for cheap, powerful energy (in combination with increasingly automated capital stock). The argument calling for proper accounting of the physical shares of production factors appears to solve the neoclassical “growth paradox”. Some economists began trying to incorporate energy use into the conventional theory to determine the causes of the large decreases in productivity growth experienced as a result of the oil crises of the 1970’s.20 21 However, these studies found that the factor share of energy implied by their models (~5 per cent) did not explain the drop in productivity from the oil crises. In fact, environmental regulations put in place by the U.S. over the 1970’s explain more of the decline in productivity growth (16 per cent) than the quadrupling of energy prices! Neoclassical economic theory is unable to answer a crucial question: what causes economic growth? The Solow model (1954) is the most widely used growth model in neoclassical economics and finds that “total factor productivity”—another name for the part of output growth computed as a residual that cannot be explained with the conventional factors: manufacturing and human capital— is typically larger than manufacturing or human capital and attributed to “technical progress” and country-specific “endowments”.22 Developments of endogenous growth models have been no more successful in solving the “growth paradox” leading to paralysis in the conventional literature.23 “Without reforms, the substitution of expensive labour for cheap, powerful energy is very likely to continue with implications for increasing unemployment.” 48 Rebound effects of energy efficiency Rebound effects refer to the phenomenon originally observed by Jevons in 1865, whereby improving energy efficiency (in his day, coal) actually leads, through various feedback mechanisms on prices, to an increase in the demand for energy.29 Thus, the current policy focus of most governments to improve energy efficiency as a means to reduce emissions may be more difficult than linear calculations suggest. The discussion above is par- Hu m a n D im e n s io n s ticularly relevant in this case because conventional economists, assuming a negligible factor share of energy to production, also assume that the rebound effects of energy efficiency will be negligible. If the contribution of energy to production is in the vicinity of 50 per cent as the biophysical accounting suggests, then the potential rebound effects of energy efficiency on energy consumption could be much larger, especially in the developing world where demand is not as saturated.30 Policy Implications Consumption The current strategy for reducing greenhouse gas emissions in most countries is focused on consuming more efficiently. But rebound effects associated with the expected decrease in energy prices from efficiency improvements mean that policies designed to promote sustainability also need to target the demand aspect. A step in this direction could be to consume differently. This strategy has been embraced by many proponents of the Green Economy. In particular, the shifting composition of industrialized economies towards services rather than manufacturing has been interpreted under this argument. However, there is a growing body of evidence that much of the decrease from the composition effect has been achieved through the export of “dirty” industries to the developing world—referred to as the pollution haven effect.31 Furthermore, consuming differently does not question the logic of continued economic growth and is still susceptible to rebound effects. Given the potentially insufficient impacts from consuming more efficiently or consuming differently, a third strategy is simply to consume less. This strategy does imply a break from mainstream economic theory, because it implies that people’s wants can be fulfilled. However, this is not to say that consuming less would not also lead to rebound effects as decreased consumption pushes down prices that could lead to increased consumption in other sectors. But it could lead to some of the collective action required as citizens (rather than consumers) to make environmental sustainability a priority in practice. Labour and Energy Without reforms, the substitution of expensive labour for cheap, powerful energy is very likely to continue with implications for increasing unemployment. Studies show that accounting for energy and labours’ true shares in production Human D imens i on s “But the relationship between debt and wealth is not necessarily one to one, since debt is a mathematical abstraction with no physical limits, whereas wealth is created in the physical world.” will be the only way to successfully tackle the issues of unemployment, resource depletion and pollution.27 In this view, the massive profits of oil and gas companies could be understood as the incorrectly-priced cost of energy in relation to its productive power. More importantly, to transition towards a Green Economy, the low prices of fossil fuels are an impediment to the implementation of other energy-conserving renewable alternatives. Thus, there is a clear role for government intervention in energy prices to equitably account for the productive power of energy and create incentives for firms to substitute back towards labour. The fractional-reserve banking system One of the most important constraints to moving off of our current growth addiction that is virtually unmentioned in the debates surrounding the Green Economy is the structure of the monetary system.32 Essentially, banks make most of their revenue from interest on loans made from deposits, keeping a fraction on reserve by law (~10 per cent in Canada, for example) and lending out the rest with interest (90 per cent). As a result, the only way for firms to make profits and borrowers to repay their loans, when taken as a whole, is if the volume of new borrowing exceeds the reserve that is taken out of circulation by banks.32 This structural requirement means that total debt must continuously increase which means that output needs to be continually increasing for firms and individuals to be able to repay their loans. But the relationship between debt and wealth is not necessarily one to one, since debt is a mathematical abstraction with no physical limits, whereas wealth is created in the physical world.33 The major 49 “The challenge now is to put words into action” implication is that the fractional-reserve banking system is structurally dependent on economic growth regardless of the sustainability desires of governments, businesses and individuals. Some authors have made some proposals for change considering 100 per cent reserve requirements, limiting the ability of banks to give credit and using so-called “high-powered” money for government investment.34 32 Such reforms are fundamental to any transition towards a Green Economy. The policy prescriptions of neoclassical economic theory are being questioned as never before Ecological economists are striving to merge an ecological worldview with economic models of human behaviour that are grounded in the finite ecosphere. In the context of a degrading natural environment in a full world, it is critical for conventional economists to adapt to changing circumstances and revise the assumptions of neoclassical theory. Numerous indicators of sustainability have been developed but they have been found to generate conflicting results depending on whether they are based on concepts of “weak” or “strong” sustainability and always-imperfect methodology.35 The substitution of natural capital for manufacturing capital, accounting for the productive power of energy and associated rebound effects, consuming less and reforming the fractional reserve banking system, are just a few of the ideas to be revised. The policy prescriptions of neoclassical economic theory are being questioned as never before but there is tremendous inertia connected to the “growth imperative” requiring collective action to fundamentally restructure the economy and human consumption patterns. The remarkable momentum rallying around the concept of the Green Economy at the moment provides hope that a more sustainable course is possible. The challenge now is to put words into action because the evidence indicates that there is not much time left to act. — [D] Dim ensions Cartoon The new rose-coloured glasses. 50 Hu m a n D im e n s io n s I llu s trat ions Lo uise Sm ith Facts and Fig ures Did you know that? Human Crops In terms of population, crops equate to .25 ha/ person. Canned Energy Recycling steel cans saves 75 per cent of the energy it takes to make steel from raw materials like iron ore and coal. Euro-centric? By 2015, 90 per cent of future economic growth will be generated outside of Europe. Irrigators Historically, irrigation comprises between 70 and 80 per cent of all water uses. There are some countries that use up to 90 per cent of their water for irrigation. Mangroovy Mangroves provide critical habitat for a variety of terrestrial, estuarine and marine species. It has been estimated that ~80 per cent of fish catches globally depend directly or indirectly on mangroves. Human D imens i on s Boreal Bank The global Boreal is the largest terrestrial carbon “bank account” on the planet. That’s Fresh Boreal ecosystems contain the largest expanse of freshwater in the world; more than 80 per cent of the world’s liquid freshwater is found in the Boreal. Demanding Global demand for energy is predicted to outstrip the global production of energy by 400 EJ (the equivalent of global energy production in 2000) by 2050. Up with patents Between 1999 and 2008, patented inventions for renewable energies increased annually by 24 per cent. Auto Giants More than 90 per cent of all travel in the U.S. is by automobile, and only 4 per cent is by all forms of public transit. Left in the Cold All polar bears are left handed. Carbon Grove Mangroves sequester up to 25.5 million tonnes of carbon per year. What a waste Researchers estimate that in developed countries, 30 per cent of the total amount of food produced is thrown away, whereby in developing countries only half is wasted. De-urban Zambia is 44 per cent urban but due to poor economic conditions it is one of the very few countries in which urbanization has actually declined. Pop! The world’s population is growing by 200,000 people a day. First Adopters Korea was the first country to adopt a green growth strategy into their long term economic strategy. 51 W ri ti ng Contest • T h i r d Plac e W i n n e r Greening the Economy An alternative paradigm to sustainable development and poverty eradication Amandeep Kaur for both developed and developing countries alike.1 Out of this need for balance arose the “transdisciplinary” endeavour of sustainable development supported by three interdependent pillars: economic development, environmental protection; and social equity. None of these independently can solve the myriad problems that plague us today. This is because addressing any of the pillars in isolation without considering their interactive effects can give rise to unanticipated consequences and the weakening of any one pillar can lead to problems in the others. Therefore, we need to consider these as not conflicting but interwoven and complementary goals.2 Due to the multifaceted focus of sustainable development, the Green Economy has emerged as an operational strategy of economic transformation through investments in ecological resources and services driving economic development. A Green Economy has been defined by UNEP as “one that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities”, based on a triad of low-carbon growth, resource efficiency and social inclusivity. This “greening” aims to dispel myths about Overview of our growth over the years Past Future? Present Global Economy Global Economy Global Economy Global Environment Global Environment Global Environment Balanced World 52 Threatened World Disrupted World Hu m a n D im e n s io n s P hotos (cl ockw is e) Z ack Lee, Caf f e Vita A s the world stands on a precipice of change, one of the most important debates to have emerged has been the one that pitches environment versus economy. There are discussions how state regulation can limit economic growth in the name of preserving the environment while without economic growth there can be no “real wealth” to afford the spending on protecting the “environmental wealth”. We have to understand that all these discussions pose the wrong set of questions. The antigrowth stance which recognizes environment as paramount is not an acceptable proposition—for we cannot exist without growth, but growth at the cost of environment will not leave anyone left to enjoy the benefits of such a growth. The need of the hour is to align economic objectives with environmental objectives to lead the world towards sustained development. We need to transform the economic activities completely to be both regenerative as well as disaccumulative so that “development” can be differentiated from “mere growth”. Changing the growth paradigm from “develop now, clean up later” to one that seeks to capture the synergies between environmental protection and economic development will therefore be challenging 1 Republic of Korea Mexico The Republic of Korea has Mexico has launched a policy of Extended started the Brazil The waste recycling process en- 1Seoul’s signature character in recyclables 2Recycling bins in Brazil Producer Responsibility (EPR) through voluntary labeling of dorsed by Brazil already which it has enforced regulations on green products as an generates returns of $2 billion a year. It products such as tires and batteries, “uncontroversial way” also prevents about 10 million tons of packaging like glass and paper among of rewarding high envi- greenhouse gas emissions where it can other things. This has led to a dra- ronmental quality. amount to about 0.3 per cent of GDP. matic increase of 14 per cent in recy- Some 95 per cent of all aluminum cans cling rates and an economic benefit and 55 per cent of all polyethylene bot- of $1.6 billion. ▲ tles are recycled. Half of all paper and glass is recovered. Recycling in Brazil generates a value of almost US$ 2 billion and avoids 10 million tons of greenhouse gas emissions. The National Solid Waste Policy (PNRS), established as a statute, provides for the collection, final disposal, and treatment of urban, hazardous, and industrial waste through the principle of shared responsibility between the government, the private sector and the public at large. At the state level, Brazil has initiated the creation of a tributary framework related to development strategy, with the plan of opening a “stock market” of environmental assets as a novel solution to carbon credits. 2 Human D imens i on s 53 Dimensions of Sustainable Development growth efficiency stability Economic For a multi-pronged approach attacking the roots of the problem, we need to understand the complexity involved in transitioning to a pathway of Green Economy. This will require many changes to the framework of national economies such as adjustments to the structure of capital and labor supply—because a Green Economy is not about stifling economic growth and prosperity in the name of environment, it’s about reconnecting with what is the “real wealth”—reinvesting in, rather than just mining, natural capital and, favouring the many over the few. It is also about a global economy that recognizes the intergenerational responsibility of nations to hand over a healthy, functioning and productive planet to the young people of today and those yet to be born.4 Measures towards a sustainable future We have established that we are poised on the brink of a transformation—it is change or perish. However, we also need to understand that making these adjustments will not always be easy—invariably we will end up making trade-offs, some of them which will darken our near future, but these burdensome upfront costs — such as replacing heavily polluting industrial era technology with twentyfirst-century green systems — would pay off in the long-term. However, given the differences between each country’s natural, human capital and relative level of development, the ability to move towards a pathway of a Green Economy/growth will vary considerably between nations.1 Given the difference in pace of nations, there can be no “one-size-fits-all” approach to achieving these objectives. Therefore, it becomes impera- Percolation of Sustainable Development Poverty Equity Sustainability Climate Change on ati alis cts ern pa int im n/ of e tio lua idenc inc va int r ba a-ge sic ne ne rat ed ion s/l a ive l eq lih uit oo y ds -The Trickle-down Effect Highest Income Groups Bottom of the Pyramid Social intra-generational equity values/cultures empowerment inclusion/consultation institutions/governance 54 Environmental resilience/biodiversity natural resources pollution Hu m a n D im e n s io n s P hotos (cl ockw is e) UN Pho to/Ma rk Gar ten, H . A da msky the inescapable trade-off between environmental sustainability and economic progress, and provide an alternative paradigm that balances both economy and environment. Another concern which is highlighted in many discussions of sustainable development points towards the fact that despite the seemingly large advantages that the “greening” of the economy is to bring; the social equity pillar of sustainable development may be left far behind in this paradigm shift. This is because even though economic progress is a precursor to social progress, it may not necessarily lead to it. Often, the percolation effect of economic progress to the bottom of the pyramid is grossly inadequate, especially in developing countries. Therefore, access to basic amenities such as universal primary education, clean drinking water and fundamental human rights such as equal pay for equal work, gender equity or basic standard of living remains largely unaddressed. In this context a Green Economy becomes relevant not only to the developed economies, but even more so to the developing ones as a key catalyst for growth and poverty eradication, where in some cases close to 90 per cent of the GDP of the poor is linked to nature or natural capital such as forests and freshwaters.3 The greening of these jobs through a paradigm change at the grassroot level will enable the trickle-down effect to reach the poor as well. China China has taken the lead in the world for moving towards the Green Economy. Realizing the vast potential in green initiatives, it wants to establish the first mover’s advantage for itself. It is already the biggest producer of wind power and 1 solar panels in the world and is now pushing ahead with a five-year plan— Chin a’s m u l t i - p ro n g e d a p p ro a c h Agenda 21—for a “clean revolution” to susta in a b l e d e ve l o p m e nt where even the developed economies are wavering. Instead of keeping Energy conservation—implementable government policies and plans environment-destroying oil subsidies, it has encouraged the active use of Reduced dependency on non-renewable resources—increasing use of renewable resources cleaner fuels and renewable resources by creating subsidies for solar and wind power. In one of the previous Bolster focus on scientific and technological innovation for energy conservation Sustainable Development Create more green jobs— generate livelihood and employment years, it decided to phase out more Balanced urban and rural development than 700,000 tons of coal-mining capacity as well as much of its outdated Decrease carbon footprint by slashing water usage and energy consumption steel-mill capacity to move towards more biodegradable and renewable substances which will boost both its economy as well as its environment. Germany The German government has made periodic increases in the tax rate for engine fuels, electricity, oil and gas for many years. The revenue recovered from this was specially earmarked to reduce nonwage labour costs by lowering the social partner’s contribution to the pension fund. The effect of the reduced non-wage labour costs is estimated to have created an additional 250.000 full time equivalent jobs and reduced carbon dioxide emissions by 3 per cent as of 2010. 1 Ban Ki-moon visits a bioenergy plant in China 2 German energy plant 2 Human D imens i on s 55 South Africa 2 India Gabon Sustainable tourism in South The National Rural Employment Africa is composed of three Guarantee Scheme (NREGS) A relatively small nation, Gabon has decided to invest in pillars: social justice, economic devel- has been devised as a public work national reforestation and park cre- opment, and environmental integrity. programme “to provide for the en- ation programmes, aimed to reorient It not only generates income and hancement of livelihood security of the it towards green growth without any decent employment for South Afri- households in rural areas by providing at international aid. This will promote cans, it does so without any negative least 100 days of guaranteed wage em- tourism, agricultural income and in- impact on the habitat, environment ployment in every financial year to every come from agricultural and allied and culture of the native people. household whose adult members vol- activities. It also hosted the Pan-Af- unteer to do unskilled manual work”.6 rican Conference on Biodiversity and 1 Tourists in South Africa meet local women 2Participants in India’s Rural Employment Scheme clean a silted reservior 3 Tourists in Gabon’s national forests Sustainable Tourism Categories of works eligible un- Development to spread the Green der NREGS are, among other things, Economy message throughout Africa. water conservation, drought-proofing Nationally, Gabon was implementing (including plantation and afforesta- policies to preserve natural resources tion), flood protection, small-scale and minimize social inequities. Gabon irrigation, horticulture and land de- had banned imports of non-biode- velopment. Environmental protection gradable plastic bags, and enacted and conservation constitute the lion policies that focused on reducing and share of work performed. This has recycling waste, as well as reutilizing generated three billion working days- plastics. Moreover, it is promoting worth of employment benefiting close lead-free gasoline and working to re- to 60 million households. duce sulphur from diesel oil. —South Africa Ecology Environment, Natural Resources Customer Satisfaction Business Profitability Sustainable Tourism Socio-Economy local and national, economic and social development, job creation, working conditions Socio-Culture monuments, cultural heritage, ethnic groups, living cultures, local cultures Decent Work 56 3 Hu m a n D im e n s io n s P hotos (cl ockw is e) Ca ll um McD o nal d, Mck ay Sa va ge, Carl o s Ol i ve i ra Re i s 1 tive to develop an integrative yet adaptive global framework, where each government must determine how the Green Economy could work for its people and for the planet. For developing economies, percolation of wealth to the bottom of the pyramid is paramount, so a focus on job opportunities and sustainable livelihoods is crucial. On the other hand, for the developed world the focus should be on capital spending on research and innovation to bring about substantial cuts in their carbon footprint. There should also be an agreement with respect to technology transfer from the developed to the developing world to enable equitable contribution in carbon cuts. This is keeping in line with an important principle of sustainable development: common but differentiated responsibility. Another concern is that the Green Economy strategies should aim to open new markets for export for even the developing economies, rather than imposing “green conditionalities” that limited developing countries’ outbound trade. This kind of green potential will do nothing to equalize the north–south divide in the world. Similar is the case for green subsidies for research and development of new technologies, new market mechanisms and environmental taxes. If improperly applied, taxes could be a development barrier and an additional burden to poor countries.5 However, if properly implemented, the resulting revenue could expand technology worldwide in the long term. Therefore, while these are good tools to encourage energy producers and consumers to adopt environmentally friendly behaviour, care should be taken so that they don’t become distortion-creating mechanisms. We must move beyond the polarities of the past, such as development versus environment, state versus market, and North versus South. Further, it is important to address the fear of developing nations over job losses resulting from greener economic policies. For example, some existing technologies may become obsolete or redundant due to newer guidelines and norms of carbon emissions. This will lead to additional costs for businesses and may even result in job loss in these sectors. Even in the most favourable scenario, in which green economic policies result in net job creation, there are questions as to the effect of the same on remuneration and skill set change for the employees. Further costs may arise due to severance packages for obsolete workers or training costs associated with green practices. We see that the governments will have a central role in changing statutes and policies and in Human D imens i on s investing public money to make this transition possible. This in turn will help unleash trillions of private funding for the Green Economy. Firm commitment and resolute action by governments at local, regional, national and international levels are needed to foster sustainable, equitable development. Further, it is critical for a Green Economy to be transparent. There is a growing need for common indicators scaled to international standards, thereby creating a common platform for evaluating progress. Also, the current spending of about one and two per cent of global GDP on subsidies for unsustainable resources such as fossil fuels, agriculture, including pesticide subsidies, water and fisheries, needs to go. Phasing these out will lead to growth and poverty eradication and open fiscal space and free resources for a Green Economy transition. The UNEP report on sustainable development calculates that the cost of shifting to a Green Economy stands at just two per cent of total world GDP, about $1.3tr at current levels, which should be spread across ten key sectors: agriculture, buildings, energy, fisheries, forests, manufacturing, tourism, transport, water and waste management. It indicates that the higher annual growth rates promised by a greener economy will be delivered within five to ten years, thereby quickly recovering the initial cost of transition with an added impetus of leading to energy savings and reduction in environmental damage. While nations are already working with great zeal on a number of these areas, five major areas still requiring considerable green work include sustainable construction, finance, energy, waste and agriculture. A significant change in these sectors will in turn help disprove the myth of green initiatives as a liability on the country’s economy. It will comprehensively challenge the myth of a trade-off between environmental investments and economic growth and instead point to a greener and cleaner world. The biggest risk of all would be to continue with the status quo The Green Economy is the solution to help mankind keep its ecological footprint within planetary boundaries. Such a transition will not be without risks and challenges. The impetus is now on the world leaders, civil society and leading businesses to collaboratively engage, rethink and redefine traditional measures of wealth and wellbeing. — [D] 57 Feature Article It’s Not Easy Being Green n the run-up to the Rio+20 conference in June this year, the language of the Green Economy has become a kind of Holy Grail. It is entirely understandable of course. Continuing uncertainties in the financial markets, faltering growth in developed economies and debt crises in the Eurozone still haunt the global economy. The political mind is focussed on getting back to what is lovingly called “business as usual”, which usually means “growth at all costs”. It is easy to forget that growth at all costs was a place of rapidly rising carbon emissions, disappearing habitats and fast declining resource quality. The fundamental dilemma underlying modern society is a profound one. Untrammelled economic growth is unsustainable—at least in anything like the form we have had it in the last five or six decades. But degrowth (décroissance in the much more palatable French) is unstable—at least within the parameters of the economic system as we know it today. No wonder we are tempted to reach for the comforting idea that there is something called a Green Economy: an economy that delivers the goods without destroying the planet. Particularly, as we live in a world in which the pursuit of economic growth—defined as the rate of increase in real (inflation-adjusted) gross domestic product (GDP)—is one of the highest priorities of governments, the private sector, and even many elements of civil society, dependent as many of them are on economic growth for financial support and basic stability. If we can move towards a Green Economy without undermining economic growth, then the difficult task of achieving sustainability will become much easier. UNEP’s recent report Towards a Green Economy defines the Green Economy as an economy “that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities”. In view of the state of the world’s economies, the impacts they are having on environments from local to global, and the widespread incidence of social and economic injustice, the appeal of a Green Economy so defined is obvious. What is less obvious is how we might get there. The UNEP report attempts to make some progress on this question. It describes in particular a set of enabling conditions for the transition to a Green Economy Why UNEP’s Green Economy is not the panacea it is made out to be and will lead neither to economic growth nor to the emissions reductions necessary to combat climate change. Peter A. Victor and Tim Jackson 58 Hu m a n D im e n s io n s I llu s trat ion Lo uise Sm ith I Human D imens i on s 59 “As impressive as the UNEP model is, it is deficient in one major respect for analysing the transition to a Green Economy: it treats I llu s tr at ion Lo uise Smit h the world as a single unit.” 60 Hu m a n D im e n s io n s covering regulatory frameworks, government investment and spending strategies, taxation and market-based instruments, investment in capacity-building, training and education, and strengthening international governance. So far so good. But what about the question of growth? It is here that the report makes its strongest claim, namely that “a Green Economy grows faster than a brown economy over time, while maintaining and restoring natural capital”.1 So UNEP’s remarkable claim is not just that the Green Economy is still a growth-based economy; but that the growth rates will be even faster than those expected under conventional assumptions about economic growth. In our view this claim is unsubstantiated. In the following paragraphs we attempt to show why. Brown growth good; green growth better? If the claim in the UNEP report is correct, we can continue to enjoy an ever-increasing output and consumption of goods and services, while improving social equity and reducing impacts on the environment. But can we? Is it reasonable to claim that a Green Economy grows faster than a brown one? Or is a more radical overhaul of economic structure needed if we are to remain within the biophysical limits of the planet? In many respects, the simulation model on which UNEP’s claim about green growth rates is made is impressive. It consists of multiple components of the global socio-economic, environmental and resource systems including: population, agriculture, forestry, industry, services, transportation, waste, water, and energy. Furthermore, it includes relationships among these multiple components, allowing for feedback and non-linearities, and uses empirical data to quantify relationships in the model. All models are simplifications of the system they are designed to represent. We build them to help understand the system in question. A key issue when designing and evaluating a model, and interpreting the results derived from it, is whether the particular simplifications are appropriate given the purpose the model is intended to serve. As impressive as the UNEP model is, it is deficient in one major respect for analysing the transition to a Green Economy: it treats the world as a single unit. All the data in the model are global averages. All the empirical relationships in the model are global averages. All the results are global averages. The model does not recognize differences Human D imens i on s among geographic regions or between richer and poorer nations. These differences are all lost in the global averages. This lack of differentiation is a particularly severe deficiency in relation to social equity, which, in an economic context, is closely related to income distribution. Per capita incomes in the richest nations can be an order of magnitude or more greater than those in the poorest nations. But these disparities are invisible in such a model. In fact, income distribution simply cannot be addressed in a model of global averages. Yet the declared aim of the model is to shed light on social equity as one facet of a Green Economy. Reliance on global averages is also a problem for other issues such as forecasts of global greenhouse gas emissions. These emissions are rising at different rates in different regions, so estimates of global emissions based on average global rates of increase differ markedly from global estimates based on the summation of estimates for individual countries or regions. The end result, as we shall see below, is that UNEP’s conclusions about green versus brown growth are at least premature, and more likely, seriously misleading. But before exploring in more detail whether a more regionally disaggregated model might change this conclusion, there are some other equally serious deficiencies in the UNEP assumptions. Perhaps the most critical amongst these is that UNEP’s Green Economy simply does not go far enough in reducing greenhouse gas emissions. How green is your Green Economy? While a significant reduction in greenhouse gas emissions climate change is only one dimension of a Green Economy, it is perhaps the most important. It is certainly the one that continues to attract the most attention. The IPCC’s 4th Assessment Report argues that in order to achieve a 450 parts per million (ppm) stabilization target and prevent “dangerous” anthropogenic climate change, carbon emissions would need to peak by 2015 and then decline rapidly, so that global carbon emissions in 2050 are in the range 15–50 per cent of carbon emissions in 2000. That is a reduction of between 50 and 85 per cent over 2000 emissions. More recent scientific evidence suggests that the 450 ppm stabilization target is insufficient to remain within a 2 degree global warming and this has led to calls for a 350 ppm stabilization target instead. This would certainly require a reduction in global emissions by 2050 at the higher end of the 50–85 per cent range. 61 “It is one thing to wish for a Green Economy. It is quite another, of course, to define it, to design it and to deliver it. There is no point hoping that by putting two words that we like together the result will be something that works.” By contrast, the greenhouse gas emission reduction target established in UNEP’s Green Economy (G2) scenario amounts to a reduction of less than 17 per cent over carbon emissions in the year 2000. So in short, the target set in the UNEP Green Economy is just not green enough. The emission reductions achieved by 2050 are woefully inadequate when compared against those required to meet climate change targets. Investing in the Green Economy A further problem with the UNEP scenarios is the way in which investment is conceptualized. Investment is fundamental to growth in any economy. In conventional economics, capital and labour are the most important factors of production. All other things being equal, an economy with more investment will grow faster than one with less investment. So any comparison of growth rates between the green and brown economies should be based on an assumption of equal investment in each economy. In the UNEP scenarios this does not happen. Investment growth is modeled as a percentage of GDP in both the green and the brown scenarios. The report claims that only the pattern (and not the amount) of the additional investment is different. Yet, an increase in investment of 2 per cent per year would only correspond to the same absolute increase in investment in the two scenarios if global GDP was also the same in both scenarios. But this is not the case. From 2030 the global GDP is larger in the green scenario. Hence additional investment is also larger, and it is no surprise then to find the Green Economy growing faster than 62 the brown one. A fairer comparison would have been to compare scenarios within which the absolute levels of additional investment were the same, not the percentages. More worryingly perhaps, the model fails to explain how this additional investment is financed. Additional investment must be paid for, most likely through a combination of private and public debt and so there are likely to be further consequences for growth, trade and distribution. These consequences are not accounted for in the UNEP model. An alternative approach would have been to avoid the financing issue by examining the consequences of a reallocation of investment rather than an increase in investment. In such circumstances no increase in funding would be required. In a paper providing technical background material to the report, the UNEP team offered a comparison of additional and reallocated investment. They concluded that “when using the same assumptions, results of the simulations do not significantly differ from each other for most variables”. But this conclusion overlooks the potential significance of the financing issue which only comes into play in the additional investment scenario. By neglecting this issue any comparison of scenarios involving additional investment and a reallocation of investment remains meaningless. Growing unequal We now come to the most important reason for questioning the conclusions of the UNEP report regarding growth rates in green and brown econ- Hu m a n D im e n s io n s Tim Jackson Dr. Tim Jackson is Professor of Sustainable Development at the University of Surrey and Director of the ESRC Research Group on Lifestyles, Values and Environment (RESOLVE). Funded by the UK Economic and Social Research Council, the aim of RESOLVE is to develop a robust understanding of the links between lifestyle, societal values and the environment, and to provide evidencebased advice to policymakers seeking to influence people’s lifestyles and omies—the use of a single region model to make assumptions about an unequal world. Emissions of carbon dioxide from the economy can be modeled using the so-called Kaya equation: CO2 = P = A = E = C = CO2 = P x A x E x C where: CO2 emissions per year (tonnes) population affluence represented as real GDP/person (US$/person) energy intensity represented as energy/GDP (kgoe/ US$) CO2 emissions per unit energy (kg/kgoe) If the percentage changes in the values of variables on the right hand side of the Kaya equation are “small”, we can simply add them together to get a very close estimate of the percentage change in CO2 emissions. So, for example, from 1998 to 2007 the average annual percentage change in global CO2 emissions was 2.6 per cent. This is approximately equal to the sum of the average annual percentage changes in population (1.2 per cent), affluence (2.0 per cent), energy intensity (-0.8 per cent) and CO2 emissions per unit energy (0.1 per cent). If these trends continue for 40 years then global CO2 emissions will increase by 169 per cent. Even if we factor in the expected reduction in the rate of growth of population to an average annual rate of 0.6 per cent but maintain the same rate of change in the other variables, global CO2 emissions would more than double in 40 years. To achieve the 35 per cent reduction in global CO2 Human D imens i on s practices. Prof Jackson also directs the newly-awarded Defra/ESRC Sustainable Lifestyles Research Group. From 2004 to 2011 he was Economics Commissioner on the UK Sustainable Development Commission, where his work culminated in the publication of the controversial book Prosperity without Growth – economics for a finite planet3. In addition to his academic work, Tim is an awardwinning dramatist with numerous radio writing credits for the BBC. emissions in the UNEP Green Economy scenario by 2050, global CO2 emission intensity will have to decline at an average annual rate of 3.7 per cent. Note that this is already some five times higher than the average decline in CO2 emission intensity over the last decade. But this simple model still portrays the global economy as a single, undifferentiated system and is essentially blind to regional, national and class disparities. The enormous variation in income, population, energy intensity and emission intensity at sub-global levels does not come into play. So now suppose instead that we apply the Kaya equation to two distinct regions of the world, one comprising the high-income countries and the other the low and middle-income countries. In this model, we find that when trends continue for 40 years, global CO2 emissions will increase by 297 per cent, rather than the 169 per cent as appeared to be the case when the projection is based on global averages. The reason for this is that the low and middle-income countries are not only growing faster than the high-income nations but they also have higher energy and carbon intensities. The average figures obscure these underlying regional trends and underestimate the task in hand. To illustrate further the dangers of this approach, in 2007 the ratio of GDP per person in high-income countries and middle- plus lowincome countries exceeded 17:1. If this ratio is maintained for the next 40 years, a rate of decline in average CO2 intensities of 4.0 per cent per year in both groups of countries is required in order to achieve the 35 per cent reduction target in the UNEP report. At the same time, there would be an increase in absolute per capita income differences 63 from US$41,000 per capita in 2011 to $110,000 per capita in 2050. This is clearly a deeply unequal world. Suppose instead that the gap between average incomes per capita in the two groups of countries were to close by mid century, with the same overall increase in world economic output. In such a world even a 4 per cent per year decline in CO2 intensities would not be enough to meet the UNEP target. The figure would instead be 5.7 per cent per year on average. Now imagine a world in which incomes in the poorest nations might reach parity with those in the rich nations by 2050 and where instead of the weak reduction target used in the UNEP report, we seek an 80 per cent reduction in global CO2 emissions over 2011 levels. In such a world, the average annual CO2 intensity in both regions would have to decline by 8.6 per cent per year. This is a sustained rate of reduction for which there is absolutely no historical precedent and for which the prospects look entirely unrealistic. The numbers just do not stack up. There are many other scenarios that can and should be considered besides those discussed here. Extending the time over which income equality is achieved would help lessen the rate at which CO2 intensities have to decline. A slower rate of economic growth, especially in the high-income countries, where the case for increasing economic output is weakest, would also reduce the rate of reduction in CO2 intensities required to meet any specified level of reduction in global CO2 emissions. But this is the crux of the matter: economic growth can undermine the achievement of environmental objectives. Peter Victor Dr. Peter Victor, author of Managing without Growth. Slower by Design, not Disaster, is a Professor in Environmental Studies at York University. He has worked for over 40 years in Canada and abroad on economy and environment as an academic, consultant and public servant. Dr. Victor was the founding president of the Canadian Society of Ecological Eco- 64 Beyond the dilemma of growth Our arguments in this article have revealed some serious question marks hanging over UNEP’s report. The UNEP Green Economy is blessed with partisan investment advantages, unrealistic in its modeling of regional differences and nothing like green enough in its carbon targets. To claim on this basis that green growth is faster than brown growth is highly misleading. It is easy enough to see why people will go to great lengths to save the idea of economic growth. When growth falters, as it has done recently, bad things happen. People lose their jobs. Firms go out of business. Sovereign debt begins to rise. Governments who fail to respond appropriately quickly find themselves out of office. In these circumstances, it is enormously tempting to focus on escape routes from the dilemma of growth that save growth and assume that it can be made sustainable. If wishes were horses, then beggars would ride. It is one thing to wish for a Green Economy. It is quite another, of course, to define it, to design it and to deliver it. There is no point hoping that by putting two words that we like together the result will be something that works. The Green Economy concept is perhaps one step closer to reality in this respect than the related concept of “green growth”, which is often used in an entirely aspirational fashion. But the relationship between the Green Economy and growth remains critical. If the Green Economy is still to be a growthbased economy—even in the richest nations— then the arguments in this article suggest that it must achieve completely unprecedented, almost certainly unrealistic, levels of improvement in technological efficiency. No one has yet come up with a convincing set of proposals for how this is to be achieved. Perhaps it is time to pay some attention to the second escape route from the dilemma of growth: defining, designing and delivering a Green Econonomics and a past-president of the my in which economic stability Royal Canadian Institute for the Adno longer rests on the unrealisvancement of Science. Currently he is tic assumption of never-ending Chair of Ontario’s Greenbelt Council, growth. — [D] a member of the Board of the David This article is based on a more deSuzuki Foundation, and several advitailed account given in “A commentary sory boards in the public and private on UNEP’s Green Economy Scenarios”, Ecological Economics (2012). Science sectors. In 2011 he was awarded the Direct (doi number - 10.1016/j.ecoleCanada Council for the Arts Molson con.2012.02.028). Prize in the Social Sciences. Hu m a n D im e n s io n s Cartoon Louise Smith D imensions Ca rtoon But how will we get there? Human D imens i on s 65 Vo ices Tony Blair Former Prime Minister of the UK need more slogans or “callsWetodon’t do the impossible. We need Opinions What does the world have to say about the Green Economy, and its role in securing a sustainable future? We looked across the globe to see what people—from aspiring young leaders to high-ranking politicians—think about this complex and widely debated idea. to take what is possible, do it and build on it. In that way we multiply our own efforts and accelerate our progress to a low carbon future and Green Economy. That is the practical road to the future and we should take it.” Achim Steiner Frederick Reinfeldt Executive Director of UNEP Prime Minister of Sweden “ challenge of attain“ingThea Green Economy and The Green Economy is emerging, in part driven by the financial and economic crisis, and in part because of a growing realization that the blunt and limited markets of the past are unlikely to sustain the current global population of six billion people, rising to nine billion by 2050.” sustainable society is huge, but there is no alternative.” Bharrat Jagdeo Hu Jintao Former President of Guyana President of China If this is to become a re“ality, “ we need to look to the day where the term Green Economy is no lon- Md. Mahmudul Alam We will step up our efforts to develop a Green Economy, a low carbon economy, and a circular economy and enhance research, development and dissemination of climate friendly technologies.” ger relevant.” Bangladesh and Malaysia Kari Jackson Cameroon “ Green Economies are economies that grow without compromising the needs of the future humankind and thereby allowing a fair and equitable access to the earth’s resources. Need for it in my community.” 66 Lu Yu China and Germany “ The transition to a Green Economy is a long term up-hill task, especially in densely populated developing countries, such as China. However, moving towards a Green Economy also brings with it an opportunity to protect the planet from otherwise worse effects of increasing uncertainty caused by climate change.” Christiana Figueres Sohn Kyung-shik Executive Secretary of UNFCCC Chairman of the Korean Chamber of Commerce is going to leave all “ofChina us in the dust. They’re committed to winning the Green Economy race. ” “ I believe that business leaders need to actively contemplate the role of business in promoting the Green Economy, based on a long-term perspective.” Join the conversation on Facebook www.facebook.com/humandimensions Hu m a n D im e n s io n s Photos UN Photo, and provided by the authors “ The Green Economy is a broad and aggregate concept of sustainable economy, sustainable livelihood, sustainable society, sustainable environment, and sustainable development, but it is not really Green until the most deprived person gets the access of food, security and the core opportunities of mainstream sustainable practices at local and global level.” Suyash Jolly Barack Obama India and the Netherlands President of the USA ‘true Green Economy' is when “theA poor are able to attain a state We’ll invest in biomedical research, information technology and especially clean energy technology— an investment that will strengthen our security, protect our planet and create countless new jobs for our people.” “ of well-being through their own and sustained and collective efforts from institutional entrepreneurship.” Tina Saavedra Clemente Felipe Calderón Philippines President of Mexico “ “ A Green Economy encapsulates a target scenario for development where the dynamics of economics, environment and governance bring about sustainability. While the global challenge is to reform existing perspectives that underpin international agreements, in the national context, a Green Economy must motivate increasing stakeholder ownership and dialogue over their own future. The vision of a Green Economy can be a contentious subject given the tension between the ideal and the constraints posed by the interaction among the spheres of economics, environment and institutions. Nevertheless, it is worth the attention in the sustainable development discourse as perspectives are supposed to be challenged and improved for greater applicability in national contexts and greater reform in complimentary global advocacies.” David Cameron Prime Minister of the UK The transition to a low“carbon economy is necessary, real and global.” Sri Lanka What can we do to build a Green Economy for the world? I think that we need to transfer into action the creativity and innovation that we can see around the world. We need to transform. We need to change individual actions in favour of massive actions through public policy.” survival “andThewell-being of all life within planetary boundaries.” Yuti A. Fatimah Indonesia and the Netherlands “ I see the definition of Green Economy coined by UNEP as something elusive due to its ambition to address human well-being, environmental risks and ecological scarcities in one shot. The good bit of a broad definition is its ability to accommodate various interests, but on the other hand, it might lead to unproductive initiatives that are rooted in the problem of uncertainty. To overcome this dilemma, I prefer to see the Green Economy as a moral movement towards an inclusive development: the willingness to become reflexive and a spirit for not harming others.” _ _ Taro Aso Former Prime Minister of Japan “ Nalaka Geekiyanage The Green Economy is a great opportunity for new growth.” Ban Ki-Moon Secretary-General of the UN “ Building a Green Economy presents tremendous opportunities. The only risk we face is in not going down this path.” Abdul Saboor Jacob Zuma Pakistan President of South Africa “ We have no option but to “manage our natural resourc- For Pakistan, a Green Economy means reforestation and conservation of mainstream agriculture with the aim of food security, mitigating rural poverty and making urban development with reduced carbon foot prints. Pro-poor green growth rather than pro-rich would have to be encouraged and emphasized in the policy dossier. Thus, the dream of a peaceful and an environmentally friendly community could be materialized without compromising the social and economic equity and the genuine needs of present and future generations.” Human D imens i on s es in a sustainable way. We have no choice but to be ecofriendly. We have no choice but to develop a Green Economy.” 67 In t e rview Greening the Urban Jungle With more than half of the world population living in cities, urban planning must adapt to new models of sustainable development. Xuemei Bai explains how governments and institutions can catch up to technology in the race to save the planet. Interviewer Carmen Scherkenbach D: A major topic at the summit will be the Green Economy. How does a Green Economy contribute to sustainable development? XB: If we look at some of the definitions of a Green Economy, one can see it is about an economy that is inclusive and competitive and that has higher resource efficiency and lower environmental impact. So, in a sense it is not a very different con- 68 cept compared to sustainable development but perhaps with a bit more positive spin in our way of approaching the problem. It is really about seeing sustainable development as an opportunity and seizing it rather than something that you only have to sacrifice for. D: What does a Green Economy mean for sustainable urban development in particular? XB: More than half of the world population is now living in cities and this share will continue to go up. In developing countries, urbanization is often concurrent with industrialization and in many places it is also a process of the urbanization of poverty. Cities have disproportionally high resource consumption and environmental impact. For example, they produce about 78 per cent of all CO2 emissions and are also the center of economic development. Cities like Bangkok or Ho Chi Minh have about 20 per cent of their countries’ national population, but they produce 50 per cent of their GDP. Cities are also centers of innovation and knowledge production. So by all means, the Green Economy is of vital importance for urban develop- ment. D: Which policy instruments should be put into place? XB: First of all, there won’t be one set of policy instruments that can fix all the problems cities are facing today. However, in terms of principles in designing policy instruments, I think it is very important to have an integrative systems approach towards our problem. Urban development has to be a development that takes into consideration its impact, for example, on agriculture and other ecosystems regarding their physical footprint. We also have to think about resource use efficiency and the environmental impact and reduce the metabolic flows through our cities, for instance through using more renewable energies like solar power. In a country like China, it will also be very important for the national government to introduce performance measures that can give incentives and encourage the mayors of cities to adopt a Green Economy concept, rather than the GDP growth rate as their only performance indicator. D: Are there implementation barriers in the way of a transition Hu m a n D im e n s io n s P hoto Xuem ei B a i DIMENSIONS: Professor Bai, looking at the Rio+20 Summit that is going to take place in June, what outcomes you expect from this event? Prof. Xuemei Bai: Twenty years ago when we had the Rio Summit it was a landmark in many ways and we all know the sustainable development notion has been widely accepted by now. Since then, there has been many research and debate and some practices in terms of sustainable development. I hope that this summit can come up with a more action-oriented resolution that can bring about real action and tangible results, that is probably more important than coming up with another set of concepts. towards sustainability within the field of urban development? Is this a question of technology or rather one of institutions? XB: I think this is a very interesting question. Recently we’ve looked into 30 different urban sustainability practices in Asian cities, trying to find out what initiated these practices, in other words, to find out about the triggers; who was playing a major role in implementing the practices; about the kind of linkage networks within which the practice has been implemented; what kind of barriers they are facing; and what their eventual pathways of these practice followed. Our research findings show that the policy change and the institutional aspect are far more important facilitators, as well as barriers, in bringing about sustainability transition. It is so much more important than access to the technology itself, which is, in a sense, a surprising finding. It also shows that most of the international financial agency-funded projects tend to stay experiments and are rarely upscaled to change the system of practice. I think this has many implications. For example, international and bilateral aiding agencies need to think seriously about how to design aiding projects that go beyond technology transfer or beyond a one-off project, as well as how to facilitate the local processes in urban sustainability practice development. D: What has been the most encouraging development of the Green Economy so far? XB: I would say the recognition of the importance of the Green Economy in a country like China is the most important progress in forwarding this concept. We have just talked about the main barriers being policy and institutional aspects rather than the technology itself, so I think highlevel recognition at the national level of the importance of a Green Economy should be considered as the most important step forward that can Human D imens i on s bring about cascading effects down the road. D: Do you see a time in the near future in which a Green Economy will be business-as-usual in cities and what would be some of the underlying mechanisms to get there? XB: Yes—it certainly has to be, at least. The traditional development patterns have proven to be problematic and for up and coming countries like China and India there are hard limitations in terms of resource availability and environmental impact which makes it almost impossible for them to follow the same kind of development pathways. For cities it is the same. Regarding a mechanism how to get there, I would really like to see that we find the answer from the real world practice. There are many cities that have been very successful and innovative by bringing a Green Economy practice through, for example by proliferating renewable energy. I think we can learn a lot from these front-runners. As the scientific community, we can contribute and facilitate this kind of learning process through extracting and building up common knowledge that can be transferred to other cities or other circumstances. — [D] Xuemei Bai Xuemei Bai is a Professor in Urban Environment at Fenner School of Environment and Society, Australian National University. With an educational background in science and engineering, and research experience in urban sustainability sciences, Prof. Bai’s current research focuses on urban sustainability science, including For more related work from Prof. Bai refer to her papers: “Landscape Urbanization and Economic Growth in China: Positive Feedbacks and Sustainability Dilemmas” and “Urban sustainability experiments in Asia: patterns and pathways”. See www. ihdp.unu.edu/article/library for more information. understanding the structure, function and processes of urban social ecological systems, the environmental and ecosystem consequences and drivers of urbanization, urban metabolism, urban energy system and the role of renewable energy, climate mitigation and adaptation of cities, innovative practices in urban environmental management, and urban sustainability transition in Asia. 69 C r o ss word 1 2 3 4 5 6 8 7 17 16 11 10 9 18 21 20 23 25 26 27 28 30 29 31 32 35 36 37 40 39 38 43 42 46 47 48 51 53 55 54 60 65 57 58 62 61 66 67 72 78 73 75 74 76 81 80 82 84 83 88 89 92 96 64 70 79 87 63 69 68 71 77 56 97 93 94 99 98 102 101 105 104 Green Economy Crossword 70 Across 1.Means of conveyance 9. Their actions strongly influence the course of events 16.Important food fish of northern Atlantic waters 17. Fab Fourth’ fifth wheel? 19.Sans attire 20.Under consideration in a written work or speech 21. Designate 22.Your “average” guy 23. Became more complex Hu m a n D im e n s io n s 100 12 13 14 15 19 22 24 33 34 41 44 45 50 49 52 59 85 90 86 91 95 103 106 25. Wind down 29. The Green Economy will be widely debated there 32. A one stringed guitar and UN institute 33. “Absolutely” in Paris 35.It’s little and white 38. The prevention of loss 41. Welcome guest on a farm 42.Number one on FDI penetration 43.Initials of former European empire 44.Pronoun 46. Capital of Africa’s most populous country 47.Such as wind and wave power 49.Number two in carbon dioxide emissions 51.Just friends 53.Out of sorts 54. This people throw for money 56. Amélie, for one 59.Romney likes it there (abbr.) 60. Can make websites sucessful (abbr.) 62. Tells about your full climate change impact 65.Makes you cool (abbr.) 66. Zones prone to flooding 70. Key source of U.S. federal backing in the social sciences 71.Oil in Florence 72.Relating to Persia, modernized 75. Half a cocktail 76. The grass on the other side 77.Joint initiative by UNEP and IHDP on wealth 79. Green vegetable dye imported from China 80. Botanists’ concern 81. Brother of Abel 83.One of Jupiter’s moons 84. Chemical symbol for lithium 87. Clutter containing radionuclides 89.UN agency concerned with atomic energy 90.Ma Ying-jeou just got his renewed 92. A 1997 protocol is named after it 94. Approximately 3.14159 95. Global affairs concentration at uni (abbr.) 96.Relating to the refreshment of health or spirits (adj.) 99.Russian-born composer of “The Firebird” (died 1971) 101. Designated UN authority for environmental issues (abbr.) 103.River in North-West Spain with decreasing salmon stock 104. A reduction of which is most desirable 105. To castigate 106. To lose weight or to escape from danger Down 1.Saying hello to a microphone 2.Miscellaneous (abbr.) 3.Snooze in Salamanca 4.Invented the gas motor engine 5. Kubrick probably shouted this often 6. A small one 7.Just right 8.In the negative 9. After Yalta 10. Family of rechargeable battery types (short form) 11.Not only children want this 12. A human’s largest joints 13.Made of 27 14. To ge to the other side, it was crossed (abbr.) 15. The beginning of life 18. With chloride it’s salt (abbr.) 22. British economist and logician, died 1882 24. Toiletry case 25.Inventor of dynamite (initials) 26.E.g. ethanol (pl.) 27.Preposition, indicates a price 28. Destination when immediate medical care is needed (abbr.) 30. Avoids depletion or damage 31.Indian auto company 32.Social process, considered a symbol of human civilization 33.Initials of soul, jazz singer: Oleta __ 34. GDP is one 35. For some it’s the sky 36.Something is fashionable 37. We’re all on it together 38. Doesn’t need social media to tweet 39. Austria’s biggest airport (abbr.) 40.Its secretariat is based in Bonn 41.Some are renewable 42.Saving on the way to earning 45.Small house 48. A leg 50.Not in favour of 52.Options 55. Tennessee Williams had it on a hot tin roof 57.Indicates an alternative 58. Wasting as little as possible (adj.) 61. Green prefix 63.Most populous Canadian province 64.Organisation to protect U.S. information systems (abbr.) 67. When a PC starts thinking (abbr.) 68.Of the sun 69.Person maintaining a relationship 73. The very cause of things 74.Its members are bears and lions (abbr.) 76. A member of the U.S. army (abbr.) 78.Use again 82. Between Greece and Turkey 85. Controlled by a mouse 86.Native of an Equatorial land 88.Name of several Chinese dynasties 91.Number of South African provinces 93. Vienna-based 12-member oil group (abbr.) 94.Might even get you coffee (abbr.) 96. Helps wash a car 97.Number of India’s main language families 98. Calendar month (abbr.) 99.Remained in one place (past-p) 100.Mythical giant bird 101.It’s __ against them 102.It’s all about reputation (abbr.) Solutions to the crossword puzzle will be available on IHDP’s new blog at the end of April, have a look and see how you’ve done at: www.ihdp.unu.edu/article/blog Human D imens i on s 71 References Quotes Achim Steiner www.b4esummit.com/wpcontent/uploads/B4E_Seoul_ Report_30July.pdf Barack Obama http://www.politicususa.com/ en/10-quotes-obama-sotu Manmohan Singh h t t p : // w w w . w h i t e h o u s e . g o v / the-press-office/remarks-president-obama-and-prime-minister-singh-india-joint-press-conference Wen Jiabao http://www.fmprc.gov.cn/eng/ zxxx/t630498.htm Ban Ki-moon www.b4esummit.com/wpcontent/uploads/B4E_Seoul_ Report_30July.pdf Felipe Calderon http://ngb.tv/2011/06/a-greeneconomy-is-possible/ Bharrat Jagdeo h t t p : // w w w. b 4 e s u m m i t . c o m / wp-content/uploads/B4E_Seoul_ Report_30July.pdf Christiana Figueres h t t p : // w w w . b l o o m b e r g . c o m / news/2011-01-27/china-winningthe-green-economy-race-un-climate-talks-chief-says.html David Cameron h t t p : // w w w . e w e a . o r g / i n d e x . php?id=1431 Hu Jintao http://news.bbc.co.uk/2/hi/science/nature/8269361.stm Jacob Zuma http://www.info.gov.za/speeches/ 2010/10051909251001.htm Frederik Reinfeldt h t t p : // w w w . t h e l o c a l . se/33860/20110519/ DID YOU KNOW THAT? Up with patents (factsheet for policymakers, p. 12) OECD (2011). Towards Green Growth. OECD, Paris. First adopters http://www.guyanatimesinternational.com/?p=7769 What a waste 72 http://www.uncsd2012.org/rio20/ content/documents/Agriculture_ OECD.pdf mate Change and Create a New Era of Progress and Prosperity.The Bodley Head. 246 Pp. De-urban http://www.projecthope.ws/index. php?option=com_content&task=v iew&id=32&Itemid=33 3. TEEB. 2011. The Economics of Ecosystems and Biodiversity in Business. Edited by Joshua Bishop. Earthscan, London. Available online at www.teebweb.org Canned Energy http://wsn.com.au/dir138/wsn.nsf/ Content/Education%20and%20 Safety_Facts%20and%20Figures_ Did%20you%20know Auto Giants h t t p : // s u s t a i n a b l e l a f a y e t t e . org/?page_id=863 Left in the Cold http://outdoornebraska.ne.gov/ wildlife/programs/legacy/facts.asp Life in Coral http://www.cinews.co.ck/2010/ January/Wed27/environment.htm Mangroovy http://conservationbytes.com/tag/ ecosystem-services/ Carbon Grove http://conservationbytes.com/tag/ ecosystem-services/ That’s fresh http://borealcanada.ca/borealdid-you-know-e.php Boreal Bank http://borealcanada.ca/borealdid-you-know-e.php Human Crops http://www.unesco.org/water/ news/newsletter/193.shtml#know Irrigators http://www.unesco.org/water/ news/newsletter/193.shtml#know IT’S NOT EASY BEING GREEN 1. Jackson, T and P Victor 2012 Social Limits to Dematerialisation. Special Issue Phil Trans of the Royal Society A, forthcoming. 2. UNEP (2011) Modelling Global Green Investment Scenarios http://www.unep.org/greeneconomy/Portals/88/documents/ger/ GER_13_Modelling.pdf GREEN ECONOMY & SUSTAINABLE HEGEMONY 1. Georgescu-Roegen, N. 1975. Energy and Economic Myths. Southern Economic Journal, 41(3):347–381. 2. Stern, N. 2009. A Blueprint for a Safer Planet: How to Manage Cli- 4. Pratt, L., Montgomery, W. 1997. Green Imperialism: Pollution, Penitence, Profits. The Socialist Register, pp.75–95 5. Mumford, L. 2010 (1934).Technics & Civilization. The University of Chicago Press edition 2010, Chicago. 495 Pp. 6. Marx, K., 1867. Capital, Volume One, Part One: Commodities and Money. Online version at http://www.marxists.org/archive/marx/works/1867c1/ch01.htm. 7. Umbrecht, B. 2011. Faust et l’alchimie capitaliste. Le Monde diplomatique, Octobre 8. World Business Council for Sustainable Development. 2008. Sustainable Consumption Facts and Trends; From a business perspective, the Business Role Focus Area. 40 Pp 9. Schumpeter, J. 2003. The Theory of Economic Development. J. Backhaus (ed.), Joseph Alois Schumpeter, Kluwer Academic Publishers, the Netherlands, p. 71. 10. Schumpeter, J. 2003. The Theory of Economic Development. J. Backhaus (ed.), Joseph Alois Schumpeter, Kluwer Academic Publishers, the Netherlands, p. 74. 11. Vatn, A. 2005. Institutions and the Environment. Edward Elgar Publishing. 481 Pp 12. Schumacher, E.F. 1973. Small Is Beautiful; Economics as if People Mattered. Blond & Briggs. 288 Pp 13. Wilkinson, R. & Pickett, K. 2009. The Spirit Level: Why More Equal Societies Almost Always Do Better. Penguin Books. 351Pp. 14. Alcott, B. 2005. Jevons’ paradox. Ecological Economics. 54 (2005): 9–21. 15. Polimeni, J.M., Polimeni, R.I. 2006. Jevons’ Paradox and the myth of technological liberation. Ecological Complexity, 3: 344–353 16. Fraser, E.D.G. 2011. Can economic, land use and climatic stresses lead to famine, disease, warfare and death? Using Europe’s calamitous 14th century as a parable for the modern age. Ecological Economics, 70: 1269–1279 Hu m a n D im e n s io n s 17. Sen, A. 2009. Development as Freedom. Oxford University Press, 366 Pp GREEN GROWTH AND INNOVATION 1. Rostow, W.W., 1960. The Stages of Economic Growth: A Non-Communist Manifesto. Cambridge: Cambridge University Press. 2. Gerschenkron, A. 1962. Economic Backwardness in Historical Perspective: A Book of Essays. Cambridge: Belknap Press/Harvard University Press. 3. Kuznets, S., 1966. Modern Economic Growth: Rate, Structure and Spread, Yale University Press, New Haven. 4. Abramovitz, M. (1986) Catching Up, Forging Ahead, and Falling Behind, Journal of Economic History, 46(2): 385–406. 5. Grossman, G. and Krueger, A., 1995. Economic Growth and the Environment, Quarterly Journal of Economics, 110(2): 353–77. 6. Strazicich, M.C. and List, J.A., 2003. Are CO2 Emissions Levels Converging Among Industrial Countries?, Environmental and Resource Economics, 24(3): 263–271. 7. Berkhout, F., Angel, D. and Wieczorek, A., 2009. Asian Development and Sustainable Socio-Technical Regimes, Technological Forecasting and Social Change, 76(2): 218– 228. 8. Bai, X., Roberts, B. and Chen, J., 2010. Urban Sustainability Experiments in Asia: Triggers, Actors, Linkages, Barriers and Pathways, Environmental Science and Policy, 13(4): 312–325. 9. Lebel, L., Mungkung, R., Gheewala, S. and Lebel, P., 2010. From Black to White: Innovation Cycles, Niches and Sustainability in the Shrimp Aquaculture Industry in Thailand, Environmental Science and Policy, 13(4): 291–302. 10. Patankar, M., Patwardhan, A. and Verbong, G., 2010. A Promising Niche: Waste to Energy Project in the Indian Dairy Sector, Environmental Science and Policy, 13(4): 282–290. 11. Rehman, I.H., Kar, A., Raven, R., Singh, D., Tiwari, J., Jha, R., Sinha, P.K. and Mirza, A., 2010. Rural Energy Transitions in Developing Countries: A Case of Uttam Urja Initiative in India, Environmental Science and Policy, 13(4): 303–311. Human D imens i on s 12. Romijn, H., Raven, R. and de Visser, I., 2010. Biomass Energy Experiments in Rural India: Insights from Learning-based Development Approaches and Lessons for Strategic Niche Management, Environmental Science & Policy, 13(4): 326–338. 13. Verbong, G., Christiaens, W., Raven, R. and Balkema, A., 2010. Strategic Niche Management in an Unstable Regime: Biomass Gasification in India, Environmental Science and Policy, 13(4): 272–281. GREENING THE ECONOMY 1. Hsiao, I Chun, 2002. An Analysis of APEC’s Green Growth Strategy in the Context of the United Nations Conference on Sustainable Development, Taylor University, Malaysia 2. Dernbach J.C. “Targets, Timetables and Effective Implementing Mechanisms: Necessary Building Blocks for Sustainable Development”, 2002. 27 William & Mary Environmental Law & Policy Review 79 3. http://www.energy-enviro.fi 4. Sukhdev, Pavan; 2002, Economy Report, UNEP Green 5. UNEP, 2011. Towards a Green Economy. Pathways to Sustainable Development and Poverty Eradication. 6. ILO 2010, NREGA—A review of Decent Work and Green Jobs ECONOMICS, GROWTH AND ENERGY IN THE GREEN ECONOMY 1. UNGA, 2011. Objective and Themes of the United Nations Conference on Sustainable Development: Second session of the Preparatory Committee for the United Nations Conference on Sustainable Development. March 07–08, 2011, United Nations General Assembly, A/ CONF.216/PC/7, pp 28 2. UNEP, 2011. Towards a Green Economy: Pathways to sustainable development and poverty eradication. United Nations Environment Program, www.unep.org/greeneconomy, pp 626 3. Weintraub, E.R., 2002. Neoclassical Economics. 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Basil Blackwell Ltd., New York, pp 247 9. Cherfas, J., 1986. What Price Whales? New Scientist, June, pp 36–40. 10. Ostrom, E., 2010. Analyzing collective action. Agricultural Economics, 41(1), pp 155–166. 11. Constanza, R., et al. 1997. The Historical Development of Economics and Ecology, Ch. 2 in An Introduction to Ecological Economics, Constanza (ed.), St. Lucie Press, Boca Raton, Fla., pp 275. 12. Rees, W., 2003. Economic development and environmental protection: an ecological economics perspective. Environmental Monitoring and Assessment, 86, pp 29–45. 13. Georgescu-Roegen, N., 1971. The Entropy Law and the Economic Process. Harvard University Press, Cambridge, Mass., pp 457. 14. Daly, H., 1991. Steady State Economics: second edition with new essays. Island Press, Washington, DC, pp 297. 15. Rees, W., 1995. Achieving Sustainability: Reform or transformation? Journal of Planning Literature, 9(4), pp 343–361. 16. Van den Bergh, J.C., Verbruggen, H., 1999. Spatial sustainability, trade and indicators: an evaluation of the ‘ecological footprint’. Ecological Economics, 29, pp 61–72. 17. Gowdy, J.M., 2000. Terms and concepts in ecological economics. Wildlife Society Bulletin, 28(1), pp 26–33. 18. McNeill, J. R., 2000. Something New 73 Under the Sun: An Environmental History of the Twentieth-Century World. New York: W.W. Norton. 19. Forbes, 2011. The Global 2000: 2011 edition. Accessed Sep. 12, 2010: http://www.forbes.com/ global2000/#p_1_s_dcompanyProfit1_All_All_All 20.Denison, E. F., 1979. Explanation of declining productivity growth. Survey of Current Business, 59(8:2), pp 1–24. 21. Jorgenson, D.W., 1984. The role of energy in productivity growth. American Economic Review, 74(2), pp 26–30. 22. Solow, R., 1994. Perspectives on Growth Theory. Journal of Economic Perspectives, 8, pp 45–54. 23. Pack, H., 1994. Endogeneous growth theory: Intellectual appeal and empirical shortcomings Journal of Economic Perspectives, 8, pp 55–72. industrialized countries. Ecological Economics, 41(1), pp 51–67. 32. Sorrell, S., 2010. Energy, Economic Growth and Environmental Sustainability: Five Propositions. Sustainability, 2, pp 1784–1809 33. Daly, H., 1980. The economic thought of Frederick Soddy. History of the Political Economy, 12, pp 469–488. 34. Lawn, P., 2010. Facilitating the transition to a steady state economy: Some macroeconomic fundamentals, Ecological Economics, 69, pp 931–936. 35. Wilson, J., Tyedmers, P., Pelot, R., 2007. Comparing and contrasting sustainable development indicator metrics. Ecological Indicators, 7, pp 299–314. 24. Cleveland, C., Costanza, R., Hall, C., Kauffmann, R., 1984. Energy use and the US economy: A biophysical perspective. Science, 225, pp 890–897. 25. Kummel, R., Strassi, W., Gossner, A., Eichhorn, W., 1985. 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Muradian, R., O’Connor, M., Martinez-Alier, J., 2002. Embodied pollution in trade: estimating the ‘environmental load displacement’ of 74 Hu m a n D im e n s io n s it site OisW ,Nv eb tRs w TuEl 2 eISs 01 ErGr 2 FRo LAN eP th A major international conference to provide scientific leadership towards the 2012 UN Conference on Sustainable Development - Rio+20 Top international plenary speakers and more than 100 sessions and side events will provide a state of the planet assessment for Rio +20. Coverage includes: climate change, ecological degradation, human wellbeing, planetary thresholds, food security, energy, governance across scales and poverty. SCIENCE r POLICY r DEVELOPMENT r INVESTMENT INDUSTRY r ENGINEERING r TECHNOLOGY r MEDIA www.planetunderpressure2012.net Organised by the global-change research programmes of the International Council for Science And their Earth System Science Partnership Human D imens i on s 75 Co mm entary Sustainability: Reassessing what we count and measure There is much to like about Resilient People, Resilient Planet: A Future Worth Choosing, the final report released January 30 by the UN Secretary General’s High Level Panel on Global Sustainability, co-chaired by Finnish President Tarja Halonen and South African President Jacob Zuma. The Panel acknowledges past successes while recognizing the failure and indeed inability of the current global political-economic order to implement the drastic changes necessary to bring about what could truly be deemed “sustainability”. It presents a vision for a “sustainable planet, just society and growing economy,” as well as 56 policy recommendations for realizing that vision. It is arguably “We need new indicators that tell us if we are destroying the productive base that supports our well-being.” the most prominent international call for a radical redesign of the global economy ever issued. Yet for all its rich content, the Panel’s report is less secure on concrete, practical solutions, and its most valuable short-term recommendation—the replacement of current development indicators (GDP or variants thereof) with more comprehensive, inclusive metrics for wealth—seems tacked on almost as an afterthought. Without quick, decisive international movement to prioritize sustain- 76 ability at the expense of the status quo, the report risks suffering the fate of its 1987 predecessor, the pioneering Brundtland Report, which introduced the concept of sustainability at the international level and similarly called for a paradigm shift, but which was not followed with action. The world today is “experiencing the best of times, and the worst of times”, begins the Panel, setting the contrasting tone for the full report: as a whole, the globe is experiencing unparalleled prosperity; great strides are being made to reduce global poverty; technological advancements are revolutionizing untold corners of life across the world, stamping out diseases and transforming communication. At the same time, inequality remains stubbornly high and in many areas is increasing; short-term political and economic strategies are driving consumerism and debt while putting ever-greater stress on the natural environment; the global population is soaring, projected to reach nearly 9 billion by 2040. By 2030, notes the Panel, “the world will need at least 50 per cent more food, 45 per cent more energy and 30 per cent more water—all at a time when environmental boundaries are throwing up new limits to supply”. Despite our advancements, it is concluded, humanity has not used the past 25 years to conserve resources, safeguard natural ecosystems, or otherwise ensure its own long-term viability. The question is nevertheless begged: is a statement—however powerful—enough? Will the world now rally to this international call to “transform the global economy”, when it did not 25 years ago? While the planet is undoubtedly facing a number of perilous crises, it may be crisis itself out of which real action is born. As the Panel points Hu m a n D im e n s io n s P hoto Lo uis e Smith Partha Dasgupta and Anantha Duraiappah out, it has never been clearer that a paradigm shift is necessary to achieve truly sustainable global development within planetary boundaries. But what is the nature of planetary boundaries? Who will coordinate an international process of studying them and who will ensure that scientific findings flow into meaningful public policy processes? These are concrete questions that demand concrete solutions. The next step must be a significant international and interdisciplinary scientific effort to tackle these issues comprehensively; therefore the Panel’s recommendation of setting up an international science panel is a step in the right direction. However, creating such a body will take time and the challenge is to get the best science to policy—in a way that is credible, legitimate and salient. The 2010 Report on the Measurement of Economic Performance and Social Progress, commissioned by French President Sarkozy, echoed the current consensus among social scientists that we are mis-measuring our lives by using per capita GDP as our yardstick for progress. We need new indicators that tell us if we are destroying the productive base that supports our well-being. An immediate move could be to mobilize and shore up those organizations that are creating new development indicators to internalize the social and environmental costs of economic growth. The International Human Dimensions Programme (IHDP) with support from the United Nations Environment Programme (UNEP) and contributions from the UN-Water Decade Programme on Capacity Development (UNW-DPC) and the Natural Capital Project, Stanford University, is with its Inclusive Wealth Report (IWR) already aiming to provide answers to the crucial question of how we Human D imens i on s accurately measure the productive base and wellbeing. With the development of this first report on the wealth and changes in the productive base of nations, the project provides a capital approach to sustainability based on a portfolio of stocks of various assets or “wealth”, including natural capital, produced capital, human and social capital. The main objectives of the IWR are to carry out a comprehensive analysis of the different components of wealth by country and their link to economic development and human well-being. The IWR pays particular attention to natural and human capital and shows how to formulate policies that are based on the social management of asset portfolios. The first IWR, focusing on a selection of 20 countries worldwide, will be officially launched at a joint UNEP and IHDP side event at Rio+20. Preliminary findings will be presented during the Planet Under Pressure Conference in London in late March. The IWR stands for a crucial first step in changing the global economic paradigm, by forcing us to reassess our needs and goals as a society, and ensuring we have the correct information with which to implement and assess our economic development and improved well-being. It is not intended as the universal indicator for sustainability. But it does offer a rigorous framework for dialogue with multiple constituencies representing the environmental, social and economic fields. Our situation is critical and, as the Panel aptly put it, “tinkering around the margins” will no longer suffice—a warning to those counting on renewable energy technologies and the Green Economy to solve our problems. The call for a radical paradigm shift in the global economic system has been again made. Our challenge now will be to follow up words and recommendations with action. — [D] 77 IHDP International Human Dimensions Programme on Global Environmental Change Hermann-Ehlers-Straße 10 53113 Bonn, Germany www.ihdp.unu.edu 78 Hu m a n D im e n s io n s