Visions of the Future Revisited We are mankind because we survive.

 We have come full circle.  During our various inquiries we got useful insights about individual environmental & natural resource problems  Now, let us combine those insights and assess the two visions

Addressing the Issue  Issue of growth in a finite environment – focus on 3 issues: o How is the problem correctly conceptualised? o Can our political & economic institutions respond in time democratically to the challenges presented? o Can the needs of the present generation be met without compromising the ability of the future generations to meet their needs?

 In the beginning : if demand is  & supply is finite  resources will exhaust & society will collapse  Price is not the only factor that retards demand growth – ↓ population plays a significant role too  Characterising resource base as finite is harsh – ignores existence of renewable resources, focuses attention to wrong issues – supports ill-conceived attempts to measure size of resource base

 Resource base is not finite - “There is energy everywhere. Choose the renewable one. Mother earth’s resources will never get over, as long as you do your bit.” – wind, solar & wave energy  Prices are going down but technology is improving – competition ↑ and we can afford to sell at lower prices  Historically, very little evidence supports a fear of impeding scarcity of minerals – extraction costs ↓  How long will this continue?

 Errors made by both – those who understate adequacy of resources & those who point to abundance  The problem is not finiteness but it is the way they are managed  Either pessimistic or optimistic views are wrong – improper incentives & inadequate information are serious – considering unlimited resources is equally wrong  Plenty are available if we are ready to pay  price – need to transition to renewable / recyclable resources has already begun

Institutional Responses  Markets have responded quickly to deal with scarcity & showing  prices  Substitution encouraged – recycling growing – consumers’ habits changing  Government intervention needed to ensure that the firm which neglects environmental damage in their operating decisions do not gain a competitive edge  Each problem to be treated case by case

 Market may automatically choose a dynamically efficient or sustainable path for future – imperfections in the market make sustainable development difficult  Left to itself market will over-exploit free access resources – thus reducing the benefits of the future generations  Sustainability guarantee with falling depletable resources requires compensation from present to future generations – financial payments can’t adequately compensate future generations

 Government intervention – in controlling pollution – firms may underprice their goods that add to pollution – intervention to ensure that firms that neglect environmental damage in their operating decisions do not gain a competitive edge  Unreasonably tough legislations are almost impossible to enforce  With price controls, incentives for supply reduced and the time profile of consumption is tilted towards present – water supply at subsidized rate  Price control – key role in hunger problem – undervalue agriculture – in LR imports when foreign exchange is scarce – in developed countries price decontrol

Sustainable Development  Economic growth in individual nations is due to  in inputs & technological progress – labour may not ↑ in future at same rate – limits to tech progress - growth  stationary state  ultimately zero  Empirical evidence shows that  Environmental control – no large impact on the economy as a whole Environmental policy has contributed more jobs than it has cost Has triggered just a little  in the rate of inflation & mild reduction in growth ∴ environment & healthy economy are compatible

 Respecting environment is incompatible with healthy economy is demonstrably wrong – economies transformed: ↑ in population & ↑ in importance of information  ‘All people automatically benefit by growth’ is naïve - ↑ leisure, longer life expectancy, ↑ goods & services – ecological foot-prints  New forms of development will be necessary  Economic incentive approach to environment – incentives changed by fees or charges, by liability laws or transferable permits

 Public policy & sustainable development should support each other – govt should send right signals through markets  Global problems – creative policies  A good partnership between public & private sectors  Current NI accounting system is wrong as doesn’t measure welfare – not considering damage done to natural resources that is irreversible

Concluding comments  United responsibility  Cannot catch every offender – high degree of voluntary compliance is necessary for smooth working of system  Producers – safety of their products  understand our responsibility as consumers – purchases to reflect environmental values in such away that market moves in right direction

 We are at the end of an era and also at the beginning of the other  Future holds transformation in many ways  Obstacles will be there as they are today too, but we are making progress, for sure!!