Economic Growth

Question 1

Economic growth

Answer 1

increase in living standards (GNP/GDP)

the environment isnt taken into account so doesnt show these kinds of inequalities

Question 2

How do economies grow?

Answer 2

increasing resources - land, labour, capital
increasing productivity - education, technology
development is more important than growth
HDI - GDP + education + life expectancy number 1 in 2007 was Norway

Question 3

Kuznets curve

Answer 3

relationship between income per capita and environmental quality
bell shaped curve - starts with environmental quality worsening as income rises due to more natural resources being used
later stages improve as income rises (less emissions, more environmental progress)
mixed evidence on the curve especially on a wider scale

Question 4

Sustainable development

Answer 4

1987 UN Brudntland report, ‘development that meets the needs of current generations without compromising the future.’ (to be as well off as today)
equity issue - need to think carefully about what we use up
weak sustainability - keep the sum of the four resources (produced, human, natural, social) non-decreasing over time. natural capital can be replaced by human capital e.g. coal for electricity
strong sustainability: human capital cannot replace natural, they are complements rather than substitutes e.g. the ozone layer natural resources and services cannot be duplicated and once we use them up they will be gone forever

Question 5

The Hartwick rule

Answer 5

Linked to the notion of weak sustainability
standards of living do not fall in the future
reinvest all rents from exploiting the non-renewable resource in produced capital (zero net investment)

Question 6

Measuring sustainability

Answer 6

greenNNP captures environmental quality in both renewable and non-renewable resources
need to look at if our activities affect the planet
genuine savings = S - change in produced capital - the change in natural capital
related with weak sustainability (can include human capital)