The now familiar definition of sustainable development from the well known Brundtland Commission Report (UN Commission on Environment and Development, 1987) defines sustainable development as : "development that meets the needs of the present without compromising the ability of future generations to meet their own needs." How operational is this definition? Can it adequately define guidelines for policy prescription and analysis? Does its precepts ensure justice? Ecological economics takes up the challenge of working out a functional analysis from which to base public policy.
All economic systems must consider three types of problems:
Efficient allocation of resources toward competing ends. Efficiency has long been the principal concern of the economics profession.
Socially acceptable distribution of the goods and the bads produced by the economy. This issue lies outside of technical analysis, incorporates values and ethical choices and is made by political institutions - - - hence, the term political economics. (Is there any other kind?)
Appropriate scale of the economy relative to nature, although this aspect of macro-economics has been neglected in the dominant neoclassical school of economic thought.
Not all observers remain comfortable with continuing the privileged position of the economist, preferring to widen the discourse. Still, ecological economics does synthesize ecology with economics, building an intelligible and critical bridge between natural science and social thought. Further, this field lends itself to both normative considerations and prescriptive analysis, enlarging the scope of sustainability analysis to include ethics and public policy.
Ecological economics recognizes a critical distinction between growth and development:
Growth pertains to increase in the quantitative scale of the market value of material and energy flows through the socially arranged economic system.
Development refers to qualitative improvement, the enhancement of the value of latent potential, of a state of the overall human-natural system.
Growth and development can occur independent of each other. Development can continue indefinitely but growth will eventually run up against limits for which there will be no substitutes. Thus, development and growth have been decoupled. Growth will carry adverse environmental consequences, but development need not. Some plain examples may help amplify this essential distinction:
If we reuse a material instead of discarding it, say a bag to carry groceries, the flow of monetary value falls: we need not pay disposal costs of the bag, nor must a bit of a tree be dedicated to provide another bag. The value of the service, carrying groceries, may be actually enhanced by a stronger bag with a convenient handle, but the amount of resources and waste will diminish. The monetized economic account views this service as a loss of value, but the real, ecological economic valuation is a net improvement: less resource burden, no waste, and even superior service.
The health care system can become bigger, but not necessarily better. We can spend more money on health care, but this may not mean that we are healthier. If our underlying state of health care improves, the health care system may actually shrink in terms of resources devoted to health care.
Perhaps you can think of your own examples, or, better still, find commonplace ways in daily life to practice ecological economics and sustainability. The opportunities abound. Simply paying attention to what we consume, where it comes from, and where it goes next can contribute to sustainability. Practicing sustainability can be easy on an individual basis, but runs contrary to established institutionalized practices, which is where we must take the argument.
Ecological economics relates human activities to nature in two important ways:
High-quality raw materials are consumed in two ways
Stocks of raw materials are drawn down, along with an enormous amount of discarded material.
The natural cycle of useful ecosystems, such as watersheds and forests, can be exceeded, destroying the capacity of the system to renew itself. The principle of sustainability originated with natural cycles in mind.
Natural systems absorb and break down waste, but the capacity of such natural systems can be overwhelmed and waste can back-up, degrading surrounding eco-systems.
Thus, ecological economics requires that we understand and respect both natural capital and absorptive capacity, neither of which is adequately included in the economic calculations of the monetized economy. The burden on nature can be reduced, but this is only part of the mission of ecological economics. The distribution of environmental goods and bads raises the important concern for environmental justice, which we will discuss later.
This essential concept must be spelled out clearly, using Daly and Miller
Also critical
Staunch defenders of private property have railed against environmental regulations as a taking of property rights. Further, since private property and political freedom have developed together, this point of view feels freedom itself threatened by, essentially, biology. There is a salient point here.
As environmental calamities quicken, regimes of regulation may intensify, even become desperate. Proponents of authentic sustainability, valuing democratization and community, have warned against the neglect of environmental concerns for fear of the next round of environmental regimes.