Why environmental sustainability can most probably not be attained with growing production

The concepts of welfare, economic growth, production, environmentally sustainable national income, environmental sustainability, environmental function and asymmetric entering are defined, because the confusion about these concepts hampers sound information. Based on these concepts the arguments are enumerated why it is plausible that environmental sustainability most probably cannot be attained with a growing production level (national income, NI) and why broad acceptance of a lower production level, meaning de-growth of production, will make attaining this goal much easier or at least possible. Some consequences of unsustainable development are provided and the alleged conflict between employment and environment is refuted. The conclusion is that our planet is threatened by a wrong belief in a wrongly formulated growth.     

Economic growth,national income and the blocked choices for the environment

Summary This paper explains why the identification of the increase of national income (or GNP) with economic growth, increase in welfare and economic success is theoretically wrong. This incorrect use of terms strengthens the one-sided orientation of economic policy on the growth of production, often at the expense of the environment. Two examples are given of how this course of affairs is blocking the social choices regarding a fundamental solution of the environmental problem. An overview is given of the possibilities of correcting the Gross National Product (GNP) figures for environmental losses. None of these are perfect, since shadow prices for environmental functions directly comparable with the market prices of goods produced can be construed only in exceptional cases. The conclusion is that the only way to arrive at national income figures corrected for environmental losses is to supplement the corrections for expenditures on preventive, restoratory and compensatory measures (defensive expenditures) with the estimated expenditures on measures required to meet physical standards, based on health and a sustainable economic development.Dr Roefie Hueting is Head of the Department of Environment Statistics at the Netherlands Central Bureau of Statistics and a Visiting Fellow at the International Institute for Environment and Society (IIUG). He is a previous contributor toThe Environmentalist (1985, pp.253–262). Dr Christian Leipert is a staff member at IIUG.     

Economic evaluation of environmental impacts: Design of a cost benefit analysis of the lower guayas flood control project,equador

Summary The linkage between ecology and economics can be made by describing our physical surroundings as possessing environmental functions. As soon as the uses of these functions compete with each other, the environment has an economic aspect. The main conflict boils down to using environmental functions, such as the functions of mangroves, in an unsustainable way by maximising production in the short run, on the one hand, and using functions sustainably in order to benefit from them in the long run, on the other.The intensity of preferences for the future availability of functions cannot be established. From this it follows that the level of the discount rate, when calculating long-term environmental effects, can also not be set. Using the market interest as the discount rate for calculating the present value of long-term environmental costs and benefits means that the preferences for sustainable use of the environment amount to zero, for in that case the present value of a dollar earned 100 years from now is practically nil. This is a strong supposition, the correctness of which cannot be proven. Unfortunately most cost-benefit analyses, such as those of the World Bank, are based on this supposition.Dr Roefie Hueting is the Head of the Department of Environmental Statistics at the Netherlands Central Bureau of Statistics. This paper represents a revision of a report originally written by the author for HASKONING, Royal Dutch Consulting Engineers and Architects, Guayaquil, Ecuador.     

An economic scenario that gives top priority to saving the environment rather than encouraging production growth

Summary Welfare, or satisfaction of wants, is not only dependent on produced goods but also on the quality of the environment, leisure time, income distribution, working conditions, employment and the safety of the future.The same amount of production and consumption requires more labour with environmental conservation than without. Under current conditions, environmental measures, nevertheless, often lead to a loss of jobs. The paper enunciates in which conditions environmental measures lead to more employment. In the scenario study the necessary environmental measures have been formulated, their effects on the environment have been estimated in physical terms and their costs in money terms. The (negative) consequences for production and the (positive) consequences for employment have been scanned with the aid of an econometric model.In the short term (20 years) the effect on production is less than expected, among others because employment is created for many jobless: part of the measures could be carried out free of charge. In the long term more measures have to be taken and the possibilities for an ever-growing production in the industrialized world will probably diminish.In the paper, it is explained why saving the environment is not only possible, but necessary as well, in order to evade overshoots in the future and to safeguard the living conditions for generations to come. The author sincerely hopes that studies like this will be elaborated for other countries. By then the politicians and the public might become convinced that it is possible and necessary to shift the priority of economic policy to saving the environment.Dr Roefie Hueting is Head of the Department for Environment Statistics, of the Netherlands Central Bureau of Statistics. In 1970, he published Wat is de natuur ons waard? (What is nature's value to us?), a collection of articles from the years 1967–1970 on the deterioration of the environment, and economic growth. In 1974, he took (cum laude) a doctor's degree, his thesis being entitled Nieuwe schaarste en economische groei. An updated version in English has been published, in 1980, under the title New Scarcity and Economic Growth. He has published numerous papers and articles on environmental problems, both in Dutch and English, for seminars, periodicals and collections.