Working Group III: Mitigation

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1.3.4 Assessment of Alternatives: Sustainable Development

While the motivating concern of the perspective described in this section is that of global equity, the literature included here has also sought to incorporate concerns of efficiency and sustainability. The main mechanism through which this has been accomplished is by using equity considerations to argue for the protection of the prospects of sustainable development in developing countries. Such an agenda is equivalent to a non-co-ordinated pursuit of sustainability in each country, as well as the formulation of policies that promote economic growth and resource efficiency.

This is analogous to the discussed in Section 1.2, in which it was shown that the cost–benefit perspective enables the assessment and comparison of alternative policy options from an efficiency standpoint. Analogously, the progression from global equity to sustainable development enables the comparison of policy options that emanate from concerns about global equity. This framework has evolved precisely to enable the assessment of the synergies and trade-offs involved in the pursuit of multiple goals–environmental conservation, social equity, economic growth, and poverty eradication (Box 1.2). These analyses touch upon many of the themes relevant to an assessment of the broad range of policy options described above–time horizon, uncertainty, and welfare.

Box 1.2. Sustainable Development

The term “sustainable development” was popularized in academic and policy circles by the Brundtland Report (WCED, 1987), although its distinctive antecedents predate the report (especially IUCN, WWF, and UNEP, 1980). The Brundtland Commission defines it as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs” (WCED, 1987, p. 8). However, although the ubiquity of references to this definition suggests a degree of scholarly consensus, this is not the case. There is considerable disagreement on conceptual grounds and, perhaps most significantly, on its operationalization (see Lélé, 1991). Nevertheless, most scholars and practitioners accept a concern for economic prosperity (development), ecological integrity (sustainability), and social justice (equity) as the three pillars of sustainable development (Buitenkamp et al., 1992; Opschoor, 1992; Munasinghe, 1993, 2000; Banuri et al., 1994; Munasinghe and Shearer, 1995; Elkington, 1997; Carley and Spapens, 1998; Sachs et al., 1998; Sachs, 1999).

Sustainable development is an integrating concept (Lélé, 1991; Perrings, 1991; Dietz et al., 1992; Munasinghe, 2000) that has emerged gradually (Rayner and Malone, 1998a , 2000; Costanza, 1999; Munasinghe, 2000; Pichs-Madruga, 1999). Initially, the environmental, economic, and social domains were treated independently, and sustainability viewed as their sum or union. More recently, with the shift in emphasis towards practical and operational aspects, the literature has begun to look at synergies and trade-offs between the three goals.

Sustainable development is one of a series of innovative concepts–following such antecedents as human development, equitable development, or appropriate development–that seek to broaden the scope of development theory from its narrow focus on economic growth.17 However, this evolution has not led to a radical transformation in the operational dimensions of development planning. The focus still continues to be the stock of capital–which in many ways serves as the proxy for welfare or as the index of the “real” or “permanent” income of a society (see Johnson, 1964). As such, much development policy concentrates on measures that stimulate investment and expand the stock of capital. Each innovation has served mainly to expand the definition of the capital stock.

Sustainable development, being the most recent in the series of conceptual advances, subsumes the earlier ones, and rather than meaning simply “development plus natural resource conservation”, includes human development, poverty eradication, and social equity as well. Accordingly, it expands the definition of the capital stock to include human capital (skills), natural capital (natural resources and biodiversity), and, most recently, social capital.18 In principle therefore, sustainable development is equivalent to investment in this composite stock of capital. However, there are differences of approach rooted in the persistent controversies in development thinking. Some authors focus on investments in all relevant forms of capital, while others focus on the capacity to make such investments. Similarly, the degree of substitution that is possible between kinds of capital -- for example, between natural and human capital -- is a subject of disagreement among researchers. (see Box 1.3).19

Box 1.3. Approaches to Understanding Sustainability

Economists distinguish between four main components of the resource base: natural capital (natural resource assets), reproducible capital (durable structures or equipment produced by human beings), human capital (the productive potential of human beings), and social capital (norms and institutions that influence the interactions among humans). These are called capital because they are durable assets capable of generating flows of goods and services. In this construction, development is sustainable if some aggregate index across all forms of capital is non-decreasing.

Strong Sustainability. The strong sustainability approach of the so-called London school (Pearce, 1993) holds that different types of capital are not necessarily substitutable, so that sustainability requires the maintenance of a fixed (or minimum) stock of each component of natural capital. Under this notion, any development path that leads to an overall diminishment in the stocks of natural capital (or to a decline below the minimum) fails to be sustainable even if other forms of capital increase.

Weak Sustainability: The weak sustainability approach asserts that the different forms of capital can substitute for one another to some degree. The substitutability of different types of capital implies that the preservation of an aggregate level of capital, rather than the preservation of natural capital in particular, is crucial. The weak sustainability approach is consistent with the idea that some loss of “climate capital” could be consistent with sustainability if increases in other forms of capital could compensate for the loss.

It might appear from the above that sustainable development entails a trade-off between investment in physical capital, social capital, and natural capital, and therefore between economic growth, income distribution, and environmental conservation. However, some branches of development theory have ceased to view these as trade-offs. In particular, the goal of the research on sustainable development–especially conservation strategies and action plans–is to show that under appropriate institutional and social conditions there is a synergy rather than conflict between different goals (IUCN, WWF, and UNEP, 1980). Even earlier, development analysts had begun to question the supposed trade-off between economic growth and income distribution (World Bank, 2000; see also Kuznets, 1955; Hicks, 1979; Chenery, 1980; Fields, 1980).

Table 1.1: Per capita income and carbon emissions in various regions
Reference case, 1990 to 2020 (MtC)
Region/Country History Projections Average annual
            change (%)
  1990 1996 2000 2010 2020 1996 to 2020
North America 1550 1687 1833 2079 2314 1.3
USA 1346 1463 1585 1790 1975 1.3
Canada 126 140 151 162 182 1.1
Western Europe 936 904 947 1021 1114 0.9
Industrialized Asia 364 389 377 435 479 0.9
Japan 274 291 273 322 358 0.9
Australasia 90 99 103 113 122 0.9
Total Developed 2850 2980 3157 3535 3907 1.1
Former Soviet Union (FSU) 991 613 583 666 746 0.8
Eastern Europe (EE) 299 228 243 270 277 0.8
Total EE/FSU 1290 842 827 935 1024 0.8
Developing Asia 1065 1474 1659 2426 3377 3.5
China 620 805 930 1391 2031 3.9
India 153 230 273 386 494 3.2
Middle East 229 283 323 434 555 2.8
Africa 178 198 214 270 325 2.1
Central and South America 174 206 251 418 629 4.8
Total Developing 1646 2161 2447 3547 4886 3.5
Total World 5786 5983 6430 8018 9817 2.1

These debates stem from the earliest days of development thinking, in which a distinction was made between the “balanced growth” advocated by some writers (Rosenstein-Rodan, 1943; Nurkse, 1958), and the strategy of “unbalanced growth” advanced initially by Albert Hirschman (1958). Hirschman argued that growth is a disequilibrium process, which occurs through the efforts of economic agents to overcome bottlenecks that emerge during normal economic activity. Therefore, policy should not be restricted merely to the mobilization of financial transfers and transfer of technology, but should focus on the larger goal of creating the capacity for mobilizing and allocating such resources,20 in effect to create conditions in which economic agents can most effectively respond to bottlenecks.

It is fair to say that the development profession has increasingly invoked themes from the latter approach. The emphasis has shifted from promoting growth towards promoting the capacity for growth. Development policy is concerned increasingly with conditions that stimulate investment–trade liberalization, structural adjustment, skill development, governance, institutional development, and market access–rather than the investment itself. This is partly because the fashion has changed from public to private investment, and partly because a large body of research shows that, while the scarcity of financial resources can inhibit the growth process, inflows do not necessarily promote it (Bauer and Yamey, 1982). For example, a recent review of cross-country experience (World Bank, 1998) discovered that the net impact of foreign resource inflows depends critically on ancillary factors–the nature of domestic policies, the fiscal stance, the institutions of governance, and the openness to international trade flows. “Successful” foreign aid led to US$2 of additional private sector investment for every dollar of aid, while in “failed” cases foreign aid was associated with a net decline in private investment.

Similar shifts have occurred in other areas of development theory and practice. The operationalization of sustainable human development, for example, is increasingly argued to consist not of the simultaneous pursuit of several independent goals, but of investments in social capital to enable the other goals to be pursued through normal market or regulatory mechanisms (Banuri et al., 1994). Poverty eradication programmes focus increasingly on institutional development rather than the creation of physical or social infrastructures. They concentrate on the fact that poor and vulnerable groups generally lack formal organizational structures and recognition as well as the capacity to respond to market opportunities.21

Table 1.2. Comparison of cumulative carbon emissions in SRES scenarios and SAR
SRES baseline scenarios Total emissions 1990 to 2100 (GtC)
B1 989
A1T 1038
B2 1166
A1B 1437
A2 1773
A1FI 2128
IPCC SAR stabilization scenarios
(Stabilization level in ppmv CO2)
Total emissions 1990 to 2100 (GtC)
450 630–650
550 870–990
650 1030–1190
750 1200–1300
1.3.5 Why Worry about Equity and Sustainable Development?

While many consider equity to be a good thing in and of itself, this alone may not be reason enough to include it within the context of climate change mitigation. The literature on equity and climate change tends to argue rather that the pursuit of equity will help generate support for mitigation efforts; and that by enabling the pursuit of sustainable development within individual countries, it will lead to more effective mitigation (Lipietz, 1995; Rowlands, 1995; Runnals, 1997; Shue, 1995; Jamieson, 1996, 2000; Byrne, et al., 1998; Parikh and Parikh, 1998; Tolba, 1998; Agarwal et al., 1999). Given that developing countries have a large suite of pressing social and economic concerns besides emissions control (Najam, 1995; Runnals, 1995; Tolba, 1998), they tend to be wary of mitigation policies lest they undermine other policy goals. Support for sustainable development, besides its own merits, can generate support for climate policy as well. While global climate policy seeks to push the Annex I countries towards emissions contraction, global sustainable development policy offers the opportunity to nudge the developing countries towards a potentially “convergent” trajectory.

Of course, the question is not simply of nudging and pushing countries towards an ultimately equitable path, but to arrive at a global stabilization that is both equitable and sustainable in the long run. Reaction to the Kyoto targets (Malakoff, 1997) suggests that this would require much more than just slight pushing and nudging. A growing literature suggests that this process would be helped by a the longer term focus on sustainability and the alternative development pathways that could lead to it. This is the subject of the next section.

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