Oxford, November 18-19, 2011
Towards the New
Understanding of
Sustainable Development
Igor Makarov
[email protected]
Higher School of Economics
Moscow, Russia
Sustainable development – classical definition
Sustainable development is that one which
“implies meeting the needs of the present without
compromising the ability of future generations to
meet their own needs” (Brundtland report)
Strong
sustainability
Weak
sustainability
Conventional economic development
model
Strong sustainability


“Each generation should leave
water, air, and soil resources as
pure and unpolluted as when it
came on earth... Each generation
should leave undiminished all the
species of animals it found
existing on earth” (UNESCO)
Natural capital shouldn’t be
decreased and shouldn’t be
substituted by any other form of
capital
‘Weakness’ of strong sustainability

Any consumption of non-renewable resources
even if it is necessary for human development
conflicts with the strong sustainability
concept

Stopping consuming natural resources will
lead to the degradation of human civilization
– it is both unpractical and immoral
Weak sustainability



Sustainable development
requires that across generations
there should be no decline in the
possibility of total capital to
generate flows of service
The aim of sustainable
development is the increase (at
least non-diminution) of total
welfare which is comprised of
natural, physical and human
capital
Any form of capital can be
substituted by the others
Adjusted net savings (World Bank)
‘Weakness’ of weak sustainability: look at ANS data!
Angola
Greece
Sudan
Saudi Arabia
Source: WB, 2009
USA
Russia
South Africa
UK
Egypt
Brazil
Canada
France
Ethiopia
Peru
Mexico
Pakistan
Indonesia
Germany
Japan
Israel
Belgium
Costa Rica
Sweden
Belarus
Romania
Korea Rep.
India
Bangladesh
China
-35
-25
-15
-5
5
15
25
35
45
“Strong’ sustainability, overriding all other
considerations, is morally unacceptable as well
as totally impractical; and ‘weak’ sustainability,
in which compensation is made for resources
consumed, offers nothing beyond traditional
economic welfare maximization”
W. Beckerman (1994)
Critical natural capital

Critical natural capital –
the part of natural capital
which has vitally important
functions and can’t be
substituted by any other
forms of capital or even
other types of natural
capital

Conventional sustainable development
concept proceeds from the prerequisite that
the larger amounts of physical, human and
natural capital generation possesses the better
it is able to respond to challenges it faces,
including natural resource and environmental
ones
EPI (2010): Top10 countries
Iceland
Switzerland
Costa Rica
Sweden
Norway
Mauritius
France
Austria
Cuba
Colombia
Source: www.epi.yale.edu
Tragedy of the commons

Each herdsman wants to
graze more and more
cattle on the pasture, but it
leads to degradation

Situations of the conflict
between individual and
common interests – social
dilemma
Garrett Hardin (1968)
Why do institutions matter?


They help to resolve social
dilemmas
Ostrom (1990) showed that
some communities can
manage the commons
efficiently and others can’t. It
depends on whether the
community is able to build
robust institutions
Elinor Ostrom (1990)

Better institutions result in lower transaction
costs which have significant importance while
solving social dilemmas.

Institution of trust! Fukuyama (1995): the
deficit of trust is like an additional tax
imposed on transactions
Correlation between EPI and Trust Index
Why do institutions matter?

Robust institutions decrease the vulnerability
of society to environmental challenges!

Sen (1999): there have never been hunger in
democratic societies even if these societies are
poor! Vulnerability of society to
environmental challenges is not a matter of
poverty but a matter of poor institutions
Why do institutions matter?

Institutions of civil society are able to unite
the whole society in green initiatives. Due to
civil society’s efforts “green” becomes up-todate – more and more people (and than firms
and governments) become “greener”
Weak sustainability concept + critical natural
capital + addition of institutional capital
Thanks for
your
attention!