Flashcards in Nature's Role in Sustaining Econ Development Deck (14):
Author of the paper?
Ocean fisheries, tropical forests, the atmosphere etc.
Ways of overcoming diminutions in natural capital
Science and technological advances, accumulation of reproducible capital, growth in human capital, improvements in the economy's institutions.
Do macroeconomic forecasts include natural capital?
Very rarely. If they do include it, it is only an afterthought.
GDP does not deduct depreciation of capital that accompanies production, especially natural capital.
INDONESIA and MALAYSIA
Net domestic savings rates are 20-30% lower than recorded savings rates when depreciation is included.
Why may markets not function well / do not exist?
Economic interactions take place over large distances, making cost of negotiation too high.
Interactions separated by large temporal distances (e.g. the effect of carbon emissions on climate in the distant future).
Failure to secure property rights.
Ill-specified / unprotected property rights prevent markets from forming or make them function poorly. Without property rights, resources are underpriced and are therefore overexploited.
Ways of eliminating nature's subsidies?
Tax - efficient rate would be the damage suffered by others.
Introduce private property rights - but who should get these rights...?
Payments for Ecosystem Services (PES).
Payments for Ecosystem Services (PES)
E.g: if lawmakers in Brazil believe that destroying the Amazon forests is the auth to economic progress there, then surely the rest of the world should pay Brazil not to destroy them?
Development that meets the needs of the present without compromising the ability of future generations to meet their own needs.
Society's productive base
Stock of all its capital assets, including its institutions. It declines if the decumulation of assets is not compensated by the accumulation of others.
An economy's wealth measures its overall productive base.
How to judge whether an economy has experienced sustainable development?
Has wealth increased relative to population growth?