Sustainable Resource Use and Economic Dynamics (The Economics of Non-Market Goods and Resources)

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A Primer on Nonmarket Valuation

The city has implemented extensive methods of public transportation, cycling, and walking, along with large areas where cars are not allowed. Since many Western countries are highly automobile-oriented, the main transit that people use is personal vehicles. The federal government has to come up with some plans to reduce the total number of vehicle trips in order to lower greenhouse gases emission.

Such as:.

Applications of Simulation Methods in Environmental and Resource Economics

Other states and nations have built efforts to translate knowledge in behavioral economics into evidence-based sustainable transportation policies. The most broadly accepted criterion for corporate sustainability constitutes a firm's efficient use of natural capital.


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This eco-efficiency is usually calculated as the economic value added by a firm in relation to its aggregated ecological impact. Similar to the eco-efficiency concept but so far less explored is the second criterion for corporate sustainability. Socio-efficiency [84] describes the relation between a firm's value added and its social impact. Whereas, it can be assumed that most corporate impacts on the environment are negative apart from rare exceptions such as the planting of trees this is not true for social impacts.

These can be either positive e. Depending on the type of impact socio-efficiency thus either tries to minimise negative social impacts i. Both eco-efficiency and socio-efficiency are concerned primarily with increasing economic sustainability. In this process they instrumentalise both natural and social capital aiming to benefit from win-win situations.

However, as Dyllick and Hockerts [84] point out the business case alone will not be sufficient to realise sustainable development. They point towards eco-effectiveness, socio-effectiveness, sufficiency, and eco-equity as four criteria that need to be met if sustainable development is to be reached. CSR as in corporate social responsibility is not what you do with your profits, but is the way you make profits. Sustainability as in effects towards Human resources, Environment and Ecology has to be measured within each department of the company. At the present time, sustainable development can reduce poverty.

Sustainable development reduces poverty through financial among other things, a balanced budget , environmental living conditions , and social including equality of income means.

Authors and Affiliations

In sustainable architecture the recent movements of New Urbanism and New Classical architecture promote a sustainable approach towards construction, that appreciates and develops smart growth , architectural tradition and classical design. Sustainable architecture is predominantly relevant to the economics domain while architectural landscaping pertains more to the ecological domain.

A study concluded that social indicators and, therefore, sustainable development indicators, are scientific constructs whose principal objective is to inform public policy-making. The framework consists of six core areas:. The United Nations Global Compact Cities Programme has defined sustainable political development in a way that broadens the usual definition beyond states and governance.


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The political is defined as the domain of practices and meanings associated with basic issues of social power as they pertain to the organisation, authorisation, legitimation and regulation of a social life held in common. This definition is in accord with the view that political change is important for responding to economic, ecological and cultural challenges.

It also means that the politics of economic change can be addressed.

Economics of Exhaustible Resources: Solving for Price in Two-Period Model

They have listed seven subdomains of the domain of politics: [90]. This accords with the Brundtland Commission emphasis on development that is guided by human rights principles see above. Working with a different emphasis, some researchers and institutions have pointed out that a fourth dimension should be added to the dimensions of sustainable development, since the triple-bottom-line dimensions of economic, environmental and social do not seem to be enough to reflect the complexity of contemporary society.

This document inaugurates a new perspective and points to the relation between culture and sustainable development through a dual approach: developing a solid cultural policy and advocating a cultural dimension in all public policies. The Circles of Sustainability approach distinguishes the four domains of economic, ecological, political and cultural sustainability. Other organizations have also supported the idea of a fourth domain of sustainable development.


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  • The Network of Excellence "Sustainable Development in a Diverse World", [94] sponsored by the European Union , integrates multidisciplinary capacities and interprets cultural diversity as a key element of a new strategy for sustainable development. The Circles of Sustainability approach used by Metropolis defines the fourth cultural domain as practices, discourses, and material expressions, which, over time, express continuities and discontinuities of social meaning.

    Recently, human-centered design and cultural collaboration have been popular frameworks for sustainable development in marginalized communities. This allows for them to understand each other's thought process and their comprehension of the sustainable projects. The user-oriented framework relies heavily on user participation and user feedback in the planning process.

    Many communities express environmental concerns, so life cycle analysis is often conducted when assessing the sustainability of a product or prototype. These factors ensure that researchers are conscious of community values that align with positive environmental, social, and economic impacts. The United Nations Conference on Sustainable Development UNCSD; also known as Rio was the third international conference on sustainable development, which aimed at reconciling the economic and environmental goals of the global community.

    An outcome of this conference was the development of the Sustainable Development Goals that aim to promote sustainable progress and eliminate inequalities around the world. However, few nations met the World Wide Fund for Nature 's definition of sustainable development criteria established in In a report for the U.

    Environmental Protection Agency stated: "While much discussion and effort has gone into sustainability indicators, none of the resulting systems clearly tells us whether our society is sustainable. At best, they can tell us that we are heading in the wrong direction, or that our current activities are not sustainable. More often, they simply draw our attention to the existence of problems, doing little to tell us the origin of those problems and nothing to tell us how to solve them. Those indicators are expected to be identified and adjusted through empirical observations trial and error.

    The most common critiques are related to issues like data quality, comparability, objective function and the necessary resources. The Cuban-born researcher and entrepreneur Sonia Bueno suggests an alternative approach that is based upon the integral, long-term cost-benefit relationship as a measure and monitoring tool for the sustainability of every project, activity or enterprise. Reasonable qualifications of sustainability are seen U. This design incorporates some ecological, economic, and social elements.

    The goals presented by LEED design goals are sustainable sites, water efficiency, energy and atmospheric emission reduction, material and resources efficiency, and indoor environmental quality. Although amount of structures for sustainability development is many, these qualification has become a standard for sustainable building. Recent research efforts created also the SDEWES Index to benchmark the performance of cities across aspects that are related to energy, water and environment systems.

    It is currently applied to 58 cities.

    The Economics of Non-Market Goods and Resources | Ian J Bateman | Springer

    The sustainable development debate is based on the assumption that societies need to manage three types of capital economic, social, and natural , which may be non-substitutable and whose consumption might be irreversible. While it is possible that we can find ways to replace some natural resources, it is much more unlikely that they will ever be able to replace eco-system services, such as the protection provided by the ozone layer, or the climate stabilizing function of the Amazonian forest.

    In fact natural capital, social capital and economic capital are often complementarities. A further obstacle to substitutability lies also in the multi-functionality of many natural resources. Forests, for example, not only provide the raw material for paper which can be substituted quite easily , but they also maintain biodiversity, regulate water flow, and absorb CO2.

    Another problem of natural and social capital deterioration lies in their partial irreversibility. The loss of biodiversity , for example, is often definitive. The same can be true for cultural diversity. For example, with globalisation advancing quickly the number of indigenous languages is dropping at alarming rates. Moreover, the depletion of natural and social capital may have non-linear consequences. Consumption of natural and social capital may have no observable impact until a certain threshold is reached.

    A lake can, for example, absorb nutrients for a long time while actually increasing its productivity. However, once a certain level of algae is reached lack of oxygen causes the lake's ecosystem to break down suddenly. If the degradation of natural and social capital has such important consequence the question arises why action is not taken more systematically to alleviate it.

    About this book

    Cohen and Winn [] point to four types of market failure as possible explanations: First, while the benefits of natural or social capital depletion can usually be privatised, the costs are often externalised i. Second, natural capital is often undervalued by society since we are not fully aware of the real cost of the depletion of natural capital. Information asymmetry is a third reason—often the link between cause and effect is obscured, making it difficult for actors to make informed choices.

    About this book

    Cohen and Winn close with the realization that contrary to economic theory many firms are not perfect optimisers. They postulate that firms often do not optimise resource allocation because they are caught in a "business as usual" mentality. Main page: Education for sustainable development. Education must be revisited in light of a renewed vision of sustainable human and social development that is both equitable and viable. When nations ensure that such an education is accessible to all throughout their lives, a quiet revolution is set in motion: education becomes the engine of sustainable development and the key to a better world.

    It has been argued that since the s, the concept of sustainable development has changed from "conservation management" to "economic development", whereby the original meaning of the concept has been stretched somewhat. In the s, the international community realised that many African countries needed national plans to safeguard wildlife habitats, and that rural areas had to confront the limits imposed by soil, climate and water availability. This was a strategy of conservation management. In the s, however, the focus shifted to the broader issues of the provisioning of basic human needs, community participation as well as appropriate technology use throughout the developing countries and not just in Africa.

    This was a strategy of economic development, and the strategy was carried even further by the Brundtland Commission 's report on Our Common Future when the issues went from regional to international in scope and application. But shifting the focus of sustainable development from conservation to development has had the imperceptible effect of stretching the original forest management term of sustainable yield from the use of renewable resources only like forestry , to now also accounting for the use of non-renewable resources like minerals.

    Thus, environmental economist Kerry Turner has argued that literally, there can be no such thing as overall "sustainable development" in an industrialised world economy that remains heavily dependent on the extraction of earth's finite stock of exhaustible mineral resources: "It makes no sense to talk about the sustainable use of a non-renewable resource even with substantial recycling effort and use rates.