Is there a trade-off between economic development and environmental sustainability?
Over the last 25 years, the global economy has doubled, while half of the total ecosystem has been degraded. Global carbon emissions have been known increased by 40% since 1990. However, economic growth, which is supposed to bring prosperity, has been limited to a few countries, mainly located in the Global North. The today’s world is characterized by substantial global inequalities: For example, one fifth of the world’s population earns only 2% of the global income. Countries of the Global South are also striving for the prosperity of the northern countries (Jackson 2009: 6). But what does a world look like in which 8 billion people live at western prosperity levels and what consequences will result? Can sustainable development take place to that huge extent?
Scholars have differing views on whether economic growth and environmental sustainability are compatible. The following is an overview of the main prevailing opinions:
Conflict thesis: There is an insoluble conflict between environmental protection and economic growth: economic growth must be reduced in order to protect the environment (Sprenger 1994: 536). For example, Tim Jackson is one of the scientists who oppose continued economic growth. He suggests a path to a sustainable economy and calls for a redefinition of wealth (Jackson 2009).
Complementarity thesis: Economic growth enables a better achievement of environmental objectives. Growth is seen as a prerequisite for improving the environmental situation (Sprenger 1994: 540).
Integration thesis: Today, growth policy is no longer focused exclusively on quantitative GDP growth, but also on qualitative and environmentally compatible growth (Sprenger 1994: 540). In this category, the Green Growth movement can be classified. Green Growth means promoting economic growth and development while ensuring that natural resources continue to provide the resources and environmental services our wellbeing requires. This strategy is sought by international organizations such as the Organization for Economic Cooperation and Development (OECD) or the World Bank (OECD 2018).
Wachstumspolitik ist heute nicht mehr ausschließlich auf quantitatives Sozialprodukt -Wachstum fixiert, sondern mehr auf qualitatives und umweltverträgliches Wachstum (Sprenger 1994: 540). In diese Kategorie lässt sich die Green Growth-Bewegung einordnen. Green Growth bedeutet, Wirtschaftswachstum und Entwicklung zu fördern und gleichzeitig sicherzustellen, dass die natürlichen Ressourcen weiterhin die Ressourcen und Umweltdienstleistungen erbringen, auf die unser Wohlbefinden angewiesen ist. Diese Strategie wird von internationalen Organisationen und Vereinigungen wie OECD (Organisation for Economic Cooperation and Development) oder der Weltbank angestrebt (OECD 2018). In the following I will argue from the perspective of the integration thesis.
To achieve sustainable growth, Weil (2012) identifies three main strategies that go hand in hand: property rights, substitution and prices.
Property Rights: Goods are generally subdivided into rival and nonrival, as well as excludable and non-excludable goods. Environmental goods belong to the category of common resources (rival and non-excludable), like grazing fields or ocean-fisheries, as well as public goods (non-rival and non-excludable), like clean air (Ostrom 1999: 497f). The affiliation of environment al goods to these categories gives rise to conflicts and the difficulty in handling them. Property rights are the main difference between the environment and most other natural resources. Nobody can own a clean environment, thus the tragedy of the common is especially accute in the case of environmental pollution (Weil 2012: 508).
Weil (2012: 517) explains this as follows: If there is no possession of a natural resource, then nobody has any incentive to try to preserve it. Free resources even encourage t heir exploitation, otherwise someone else would use the resources at a later point if you don’t use it now. One of the most serious cases of congested resources which can be traced back to the lack of property rights is overfishing in international waters.
Substitution: Substitution takes place when companies replace the use of scarce, non-renewable with renewable, abundant resources. One of the most well-known resource-saving technologies is solar energy: photovoltaic cells which produce electricity directly from sunlight. This technology has existed for more than a century (Weil 2012: 506f). Probably we will also be able to eat meat without having to kill an animal, as soon as the production of artificial meat becomes cheaper, and thereby avoiding the negative effects on animals and the environment (Schaefer 2018).
Prices: A good example of a resource with no property right is a clean environment. Therefor other mechanisms must work to prevent the pollution and exploitation of this resource. If the cause of pollution, e.g. by emitting exhaust gases, no costs are incurred, whereby producers have no incentive to limit their emissions. However, if the pollution has a price, producers will find ways to prevent pollution by the use of alternative, less harmful technologies. High levels of environmentally harmful behavior also create an incentive to invest in research and development of alternative technologies (Weil 2012: 508).