Toward sustainable development : an ecological economics approach / by Philip A. Lawn.

Format:

Book

Author/Creator:

Lawn, Philip A.

Series:

Ecological economics series (International Society for Ecological Economics)

Ecological economics series

Language:

English

Subjects (All):

Sustainable development.

Environmental economics.

Physical Description:

462 pages : illustrations ; 25 cm.

Place of Publication:

Boca Raton : Lewis Publishers : International Society for Ecological Economics, [2001]

Contents:

1.1 The aims and objectives of the book 1

1.2 What is ecological economics? 3

I An ecological economic view of the sustainable development concept

2 An overview of the sustainable development concept 11

2.1 An examination of a range of sustainable development concepts 11

2.1.1 A brief look at the process that led to the establishment of the sustainable development concept 12

2.1.2 An examination of a range of sustainable development definitions 14

2.1.3 The perception of continuous growth as a sustainable development prerequisite 17

2.1.4 Hicksian income and a constant stock of capital as a sustainable development condition 18

2.2 An ends-means spectrum as the theoretical foundation for a sustainable development concept 21

2.2.1 The movement toward sustainable development as the ecological economic problem 25

2.2.2 The interdependent relationship between sustainability and development 26

3 What is development? 29

3.1 Development: a qualitative rather than quantitative phenomenon 29

3.1.1 Development requires intermediate ends to be appropriately ranked and the ultimate end to be appropriately conceived 30

3.1.2 What is the ultimate end? 32

3.1.3 Development requires the ultimate end to be updated suitably 34

3.2 Establishing a development-based rule of right action 35

3.2.1 Human existential balance demands an optimal stock of human-made capital 37

3.2.2 A principle of limitation as a development-based rule of right action 39

3.2.3 Development requires the maintenance of moral capital 40

3.3 What is development? A summary 41

4 What is sustainability? 43

4.1 Does sustainability matter? 43

4.1.1 Sustainability and the higher-order moral principle of intergenerational equity 43

4.1.2 Sustainability as a development prerequisite 44

4.1.3 What needs to be sustained? 46

4.2 The instrumental source and sink functions of natural capital 48

4.2.1 The complementarity of human-made and natural capital

how much natural capital is needed? 49

4.2.2 Sustainability requires the maintenance of the ecosphere's negentropic potential 52

4.2.3 Establishing guidelines as precepts for operating sustainably 55

4.2.3.1 The source function 55

4.2.3.2 The sink function 58

4.2.3.3 Recycling 60

4.2.4 Sustainability precepts to maintain the ecosphere's source and sink functions 60

4.3 The instrumental life-support function of natural capital 61

4.3.1 Biodiversity and the life-support function of natural capital 63

4.3.2 Implications of the need to preserve biodiversity 65

4.4 The intrinsic value of natural capital 66

4.4.1 An obligation to preserve the evolutionary process 67

4.4.2 Implications of a biocentric stance 69

4.5 What is sustainability? A summary 70

5 What is sustainable development? 71

5.1 Reconciling sustainability and development 71

5.2 Justifying the concept of sustainable development 73

II Sustainable development, economic theory, and macro policy goals and instruments

6 Sustainable development and an optimal macroeconomic scale 77

6.1 What is an optimal macroeconomic scale? 77

6.1.1 Standard economics' glittering anomaly 78

6.1.2 The uncancelled benefits of economic activity 79

6.1.3 The uncancelled costs of economic activity 81

6.1.4 Sustainable net benefits and an optimal macroeconomic scale 81

6.1.5 Electing to operate at the maximum sustainable macroeconomic scale

when the maximum sustainable scale is the optimal scale 84

6.2 Technological progress and an optimal macroeconomic scale 85

6.2.1 Introducing the ecological economic efficiency (EEE) identity 86

6.2.2 Impact of a beneficial shift of the uncancelled benefits (UB) curve 87

6.2.3 Impact of a beneficial shift of the uncancelled cost (UC) curve 89

6.2.4 Increasing efficiency

not always implying a larger optimal scale 91

6.2.5 Efficiency-increasing and throughput-increasing technological progress 93

6.2.6 The ecological economic efficiency identity

breaking the ecological economic problem into manageable yet interdependent subproblems 94

6.3 Additional aspects of an optimal macroeconomic scale 95

6.3.1 Limits to the beneficial shift of the uncancelled benefits and uncancelled costs curves 95

6.3.2 A sustainability buffer

allowing for uncontrollable fluctuations in the ecosphere's long-run carrying capacity 96

6.3.3 A biocentric versus egocentric optimum 97

7 Economic efficiency and policy goals and instruments 99

7.1 Standard versus ecological economic efficiency 99

7.1.1 Recognising trade-offs that contribute to the movement toward sustainable development 100

7.1.2 Ecological and standard economic efficiency 102

7.2 Macro policy goals and instruments 104

7.2.1 The erroneous belief that an efficient allocation solves the throughput problem 106

7.2.2 Price-determined outcomes and price-influencing decisions

addressing the intermediate macro policy goals in the correct order 110

8 Sustainable development and the role of relative prices 113

8.1 What are the main determinants of relative prices? 113

8.2 Relative prices

comparing the standard and ecological economic efficiency contexts 115

8.2.1 Low entropy resource prices 115

8.2.1.1 Comparing the standard and ecological economic efficiency contexts 116

8.2.1.2 Renewable versus nonrenewable resource reliance 120

8.2.2 The relative prices of human-made capital 121

8.2.2.1 Comparing the standard and ecological economic efficiency contexts 122

8.2.3 Relative price variations

often reflecting disparate efficiency contexts 123

9 Sustainable development and the role of the market 125

9.1 What is a market and what is required for it to operate freely and effectively? 125

9.1.1 Why do markets exist? 126

9.1.2 The virtues of the market

a function of the market's institutional setting 127

9.2 The conventional view of the market 128

9.2.1 The conventional free market view

falsely positing a conflict between freedom and authority 129

9.2.2 The conventional free market view

falsely positing a natural economic order driven by individual self-interest 130

9.3 The propensity for the market to erode its own requirements 132

9.3.1 The tendency for competition to be self-eliminating 132

9.3.2 The tendency for the market to deplete moral capital 133

9.3.3 The tendency for the market to deplete its natural capital foundations 133

9.3.4 The tendency for the market to fail 134

9.4 What is an appropriate market domain? 135

9.4.1 Rejecting the conomic imperialist and minimalist market positions 135

9.4.2 The evolution of a more appropriate market domain 136

III Sustainable development and the co-evolutionary paradigm

10 The neoclassical economic framework as a product of the Newtonian world view 141

10.1 The need to assess the neoclassical paradigm's atomistic-mechanistic foundations 141

10.2 Characteristic features of the Newtonian world view and the neoclassical economic paradigm 143

10.2.1 Characteristic features of the Newtonian world view 143

10.2.2 The neoclassical economic paradigm as a product of the Newtonian world view 145

10.3 The shortcomings of both the Newtonian world view and the neoclassical economic paradigm 148

10.3.1 The inadequacies of the neoclassical economic paradigm 149

10.3.2 Bridging the gap between theory and reality

the need for a paradigm shift 151

11 The development of a co-evolutionary-based conceptual framework 153

11.1 The basic principles underlying a co-evolutionary-based conceptual framework 153

11.1.1 What are the basic features of a coevolutionary world view? 153

11.1.2 The global system as one large evolutionary process 157

11.2 Fundamental aspects of a co-evolutionary-based conceptual framework 159

11.2.1 Macro stability and micro chaos

opposing aspects of the principle of self-organisation 159

11.2.2 The principle of co-evolutionary balance 160

11.2.2.1 The very short term 161

11.2.2.2 The short term 162

11.2.2.3 The medium term 162

11.2.2.4 The long term 163

11.2.3 The emergence of systemic instability and chaos through bifurcation 164

11.2.3.1 Implications 165

11.2.4 Rapidity and frequency of systemic chaos through bifurcation 165

11.2.4.1 Implications 166

11.2.5 Sources of surprise

risk, uncertainty, and human ignorance 167

11.2.5.1 Risk and uncertainty 167

11.2.5.2 Closed and open ignorance 168

11.2.5.3 Implications 169

11.2.6 Feedback in co-evolutionary processes 170

11.2.6.1 Implications 172

11.2.7 Human belief systems as a driving factor in global co-evolutionary processes 173

11.2.7.1 Implications 173

11.2.8 Institutions as the biological equivalent to the gene 174

11.2.9 History matters

chreodic evolutionary pathways 175

11.2.9.1 Implications 175

11.2.10 Path dependency in coevolutionary processes 175

11.2.10.1 Implications 176

12 The market: a co-evolutionary feedback mechanism 179

12.1 The role of the market in the co-evolutionary process 179

12.1.1 Economic genotypes and phenotypes 180

12.1.1.1 The economic macrogenotype 180

12.1.1.2 The economic macrophenotype 181

12.1.2 The price-influencing effect of genotypic and phenotypic evolution 182

12.1.2.1 The price-influencing effect of phenotypic evolution 182

12.1.2.2 The price-influencing effect of genotypic evolution 183

12.1.3 A schematic representation of the co-evolutionary process 184

12.2 The market as a co-evolutionary feedback mechanism 186

12.2.1 Incorporating recursive feedback into the evolutionary economic schema 187

12.2.2 The market as a negative feedback mechanism 189

12.2.3 The market as a positive feedback mechanism 190

12.3 Further applications of the evolutionary economic schema 192

12.3.1 Human responses to positive feedback effects 192

12.3.2 Path-dependency implications for policy implementation 195

12.3.3 Externalities from a co-evolutionary perspective 197

IV Toward sustainable development

13 Toward sustainable development: a framework for policy setting and national accounting reform 203

13.1 Policy setting, national accounting, and the optimal macroeconomic scale 203

13.1.1 The failure of policy

a failure to embrace the notion of an optimal macroeconomic scale 203

13.1.2 Co-evolutionary explanations for the perceived growth imperative 204

13.2 A framework for policy setting and national accounting reform 206

14 Toward sustainable development: sustainable development indicators 211

14.1 The need for national accounting reform 211

14.2 Reform no. 1: a strong sustainability measure of Hicksian income 212

14.2.1 Establishing a strong sustainability measure of Hicksian income 214

14.2.2 A previous attempt at a national measure of Hicksian income 217

14.2.3 Problems with Hicksian income

the need for a sustainable net benefit index 218

14.3 Reform no. 2: a sustainable net benefit index 219

14.3.1 Nordhaus and Tobin's measure of economic welfare 219

14.3.2 Zolotas's index of economic aspects of welfare 220

14.3.3 Daly and Cobb's index of sustainable economic welfare 221

14.3.4 How useful is the index of sustainable economic welfare? 222

14.3.5 Introducing the sustainable net benefit index 224

14.3.6 Account no. 1

the uncancelled benefit account 225

14.3.7 Account no. 2

the uncancelled cost account 229

14.3.8 Calculating the sustainable net benefit index 239

14.3.9 Cross-country comparison of the sustainable net benefit index and indexes of sustainable economic welfare 240

14.4 Reform no. 3: a measure of ecological economic efficiency 242

14.4.1 Account no. 3

the human-made capital account 242

14.4.2 Account no. 4

the throughput account 244

14.4.3 Account no. 5

the natural capital stock account 248

14.4.4 Calculating the ecological economic efficiency (EEE) ratio 252

14.4.5 Ratio no. 1

the service efficiency of human-made capital 252

14.4.6 Ratio no. 2

the maintenance efficiency of human-made capital 254

14.4.7 Ratio no. 3

the growth efficiency of natural capital 255

14.4.8 Ratio no. 4

the exploitative efficiency of natural capital 257

14.5 Reform no. 4: supplementary sustainable development indicators 258

14.5.1 Supplementary development indicators 261

14.5.2 Supplementary sustainability indicators 266

14.5.3 Ranking the sustainable development performance of different countries 270

15 Toward sustainable development: policy conclusions and prescriptions 273

15.1 Structure of the chapter 273

15.2 Policy prescriptions to resolve the macro policy goal of allocative efficiency 274

15.2.1 Establishing a set of properly defined property rights 274

15.2.1.1 Exclusivity 275

15.2.1.2 Transferability 277

15.2.1.3 Universality 277

15.2.2 Minimising transaction costs 277

15.2.2.1 The generation and dissemination of information and knowledge 277

15.2.2.2 Removing unnecessary nonprice rules and regulations 278

15.2.2.3 Reducing the cost of contract enforcement 279

15.2.3 Establishing and maintaining the contestability status of markets 279

15.2.3.1 Dealing with sunk costs 280

15.2.3.2 Dealing with instances where sunk costs cannot be detached from the utilising firm 280

15.2.3.3 Market deregulation and the privatisation of government instrumentalities 281

15.2.4 Labour market and corporate reform 282

15.2.5 Ameliorating externalities 284

15.2.5.1 Internalising the user cost of nonrenewable resource depletion 286

15.2.5.2 Environmental assurance bonds 287

15.3 Policy prescriptions to resolve the macro policy goal of distributional equity 288

15.3.1 Minimum and maximum levels of income and wealth 288

15.3.1.1 Determining minimum and maximum limits on income 289

15.3.1.2 Determining maximum limits on wealth 290

15.3.2 Financing a minimum income 291

15.3.3 Other important redistribution mechanisms 293

15.3.3.1 Contestable markets 293

15.3.3.2 Profit-sharing arrangements 293

15.3.3.3 The free and universal entitlement to basic rights and privileges 294

15.4 Policy prescriptions to resolve the macro policy goal of ecological sustainability 294

15.4.1 Tradeable resource exaction permits 294

15.4.2 Setting and policing of environmental guidelines 297

15.4.3 Sustainable use of agricultural land 297

15.4.4 Preservation and restoration of critical ecosystems 298

15.4.5 Transferable birth licenses 299

15.4.6 Immigration 300

15.5 Policies to establish and maintain the market's moral capital foundations 301

15.5.1 Minimising the depletion of moral capital through functional property rights and a corporate charter 301

15.5.2 The need for functional property rights to incorporate both rigidity and flexibility 302

15.5.3 Re-embedding the macroeconomy into the social and ecological spheres 302

15.6 International trade policy 303

15.6.1 The arguments for and against free international trade 303

15.6.2 Policies to gain the sustainable net benefits of international trade 307

15.6.2.1 Restoring comparative advantage by restricting the mobility of financial capital 308

15.6.2.2 Facilitating efficiency-increasing rather than standards-lowering competition 310

15.7 Additional policy conclusions and prescriptions 312

15.7.1 Facilitating efficiency-increasing technological innovation 312

15.7.2 Discounting 313

15.7.3 Central bank control of a nation's money supply 315

15.7.4 Severing the GDP-employment link and the GDP-poverty link 317

15.7.4.1 Severing the GDP-employment link 317

15.7.4.2 Severing the GDP-poverty link 319

15.7.5 International consensus on sustainable development issues 319

15.7.6 A timetable to gradually introduce sustainable development policies 320

16 Toward sustainable development: the need for moral growth 323

16.1 Why sustainable development requires moral growth 323

16.1.1 Boulding's three generalised systems of power 324

16.1.2 Moral growth

an essential feature of the integrative system of power 326

16.2 How is moral growth achieved? 328

16.2.1 A moral consensus gained through the integrative power of the truth 328

16.2.2 The integrative power of truth

created via a learning/teaching process 329

16.2.3 The need for nondialectical institutions, organisations, and processes 330

Appendix 1 The uncancelled benefit account for Australia, 1966-1967 to 1994-1995

A1.2 Psychic income 338

A1.3 Psychic outgo 353

Appendix 2 The uncancelled cost account for Australia, 1966-1967 to 1994-1995

A2.2 Sacrificed source function of natural capital 368

A2.3 Sacrificed sink function of natural capital 386

A2.4 Sacrificed life-support function of natural capital 391

Appendix 3 The human-made capital account for Australia, 1966-1967 to 1994-1995

A3.2 Human-made producer and consumer goods 395

Appendix 4 The natural capital account for Australia, 1966-1967 to 1994-1995

A4.2 Nonrenewable resources 407

A4.3 Renewable resources 417.

Notes:

Includes bibliographical references (pages 433-448) and index.

ISBN:

1566704111

OCLC:

43851520