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Akio Ito
The Hokkai-Gakuen Kitami University, Japan

Hideaki Abe
The Hokkai-Gakuen Kitami University, Japan

A comparative analysis of Japan and Korea on the effectiveness in reducing household waste generation

In this study, we attempt to build two analytical models of Japan and Korea and perform a simulation of the household waste generation mechanism. Also, we compare the effects on waste generation reduction in 57 cities where a waste disposal fee system was introduced with that of the national average of the 47 prefectures in Japan. We also compare the effectiveness of Japan's household waste generation program with that of Korea's. As a result, it was proven that: 1) as commercialisation of a country progresses, the amount of waste generated also increases but the introduction of a waste disposal fee system acts as a restraint on this waste generation; 2) the factor of resource recovery rate showed a large negative value with less of an effect on reducing the amount of waste generated in the 57 cities than in the 47 prefectures; 3) the waste collection fee systems, especially the introduction of a system based on cost per quantity, had a large effect on the reduction of the amount of waste generated; 4) Korea's deposit imposition system led to a reduction in the amount of refuse generated. Also it has been proved that the economic incentive has a great effect in reducing the amount of waste generation, 5) Korea's program of waste generation reduction waste is found to be more effective than that of Japan.


Rosemary F. James
Centre for Resource and Environmental Studies, The Australian National University, Canberra, ACT, Australia

Russell Blamey
Health Insurance Commission, Canberra, ACT, Australia

Deliberative non-market valuation

The necessarily limited information presented in stated preference questionnaires and the small amounts of time respondents generally devote to their replies both potentially impact the resultant WTP estimates. Methods derived from the principles of discursive and deliberative democracy offer a possible means of providing WTP estimates of increased validity and robustness, through the provision of information, opportunity to deliberate in a social setting and time to do so. In this paper, results obtained from the use of a citizens' jury to estimate WTP for improvements in national park management are discussed. It is understood that non-market valuation has not previously been used in a deliberative context such as is provided by a citizens' jury. Theoretical and practical issues surrounding the use of this method are considered and recommendations made for future such applications and for further research in this emerging area.


Marco Janssen
Free University, Amsterdam, The Netherlands

J. C. J. M. van den Bergh
Free University, Amsterdam, The Netherlands

Modelling physical and behaviour processes in an ecological economic system

Integration of physical and behavioural processes remains a fundamental challenge for ecological economics. Analyses of the physical processes in economies are mainly static and descriptive. Economic growth models contain usually one and sometimes two sectors, and omit any reference to physical limits. Integration of physical and behavioural processes to study the 'metabolism' of an economic system can help to make the interpretations of economic growth theory more transparent. Furthermore, inclusion of physical constraints in economic models will make these models more realistic as well as informative for environmental policies. The aim of this paper is to develop an integrated model of physical and behavioural processes to examine delinking of economic growth from energy and material use. The economic system contains various sectors such as production of consumer and capital goods, energy and material production, services and waste management. The environmental submodel describes renewable and non-renewable resources. Degradation of the environmental submodel can affect the performance of the economic system. Options to reduce the use of energy and materials are reuse, recycling, incineration and structural change towards service/information economy. Model analysis helps us to identify trade-offs between these options.


Tingsong Jiang
Research School of Pacific and Asian Studies, The Australian National University, Canberra, ACT, Australia

Warwick McKibbin
The Australian National University, Canberra, ACT, Australia

Assessment of China's pollution levy system: an equilibrium pollution approach

China has since 1979 implemented a peculiar levy system for pollutant emissions exceeding the standard. It has been criticised on two principal grounds. Firstly, the levy rate is too low to give an incentive for firm to comply the environmental regulation. Secondly, the strictness of enforcement is thought to vary widely, so factories in different regions face very different penalties for polluting. By contrast, some authors show that the pollution levy system does play an important role in preventing China's water environment from further deterioration. Using province-level panel data for the period 1992-96, this paper tests both the conventional critiques and the new claims. It contributes to the current literature in the following aspects. Firstly, it provides a good basis for the specification of environmental supply and demand functions originated from profit and utility maximisation. Secondly, other regulations are also considered in estimating the demand function. Thirdly, it uses the new data set to address the issues. Lastly and most importantly, the environmental supply and demand functions are estimated jointly for wastewater, waste gas and solid wastes. It is found that the pollution demand functions have the usual downward sloping property, implying that pollution levy system gives firms incentives to cut down their pollution emissions. However, the pollution supply is not well behaved. The coefficients are either insignificant or of wrong sign. It is clear from this result that the levy rate is set arbitrarily, rather than according to the welfare optimisation principle.


Seunghun Joh
Korea Environment Institute, Seoul, South Korea

Analysis of air pollution control benefits estimation of reduction of GHG: international co-control benefit analysis program for South Korea

As many developing countries have conducted extensive analysis of possible greenhouse gas abatement measures, little attention has been given to full characterisation of the more immediate environmental and health benefits that would result from these measures. Understanding these benefits has been a critical gap in past efforts to help developing countries estimate the cost-effectiveness of greenhouse gas mitigation. Improving a country's understanding of the scope and potential magnitude of these direct public health benefits can help develop better policy recommendations considering the full impact of adopting alternative climate change mitigation policies. This paper reports on a case study of South Korea carried out by interdisciplinary teams from Korea and the United States. The specific objectives of this work include i) assessing and quantifying the air pollution benefits of energy technologies identified as priorities for greenhouse gas mitigation (based on emissions inventories and air quality scenarios); and ii) consolidating the capacity to conduct economic evaluation and risk assessments. The scope of work includes five major modules: 1) GHG mitigation scenarios development, 2) ambient air pollution models, 3) health effects estimation, 4) economic valuation, and 5) benefits analysis.


Kun H John
Environmental Planning Institute Seoul National University, South Korea

So Y. Kuh
Seoul National University, South Korea

Preservation value of ecological resources in the transfrontier areas: the case of Korean demilitarised zones

The Demilitarised Zone and the Civilian Control Zone along the South-North Korea divide have served as a sanctuary for diverse biological resources since the Korean War. While these Zones were under the control of the military authority, its ecological resources have been protected from human disturbances for the past half-century. This ecological sanctuary, however, has been under a persistent threat of development planned by the industrial sectors. The fundamental problem is conflicting interests between the private preferences which lead to resource appropriation and the social preferences which value resource preservation. Here we need to consider the long-term benefit involved in preserving the bio-reserves and compare this benefit with immediate monetary goals of development. The benefits of preserving the resources are perceived but are not transacted in the market. Therefore, the solution for this conflict can be addressed in a constructive manner if approached from a nonmarket valuation perspective. The purpose of this study is to formulate a policy measure to guide the concerned government agency toward ecological economy in which humans and wild animals/plants are the harmonised co-users of the ecosystem basis. The CVM is fitted reasonably well to estimating non-use values and to present that biodiversity is not in conflict with economic well-being but in fact essential to it. As the bequest non-use value implies, the desire for keeping ecological resources is stimulated not only for the individuals' current satisfaction but also for the well-being of their next generation.


Gopal Kadekodi
Centre for Multi-Disciplinary Development Research, Dharwad, Karnataka, India

Aparna Nayampalli
Centre for Multi-Disciplinary Development Research, Dharwad, Karnataka, India

Towards sustainability: reversing biodiversity losses of Chilika Lake in India

Chilika Lake is the largest lagoon in Asia on the East Coast of peninsular India. The lake has been a rich preserve of ecological diversity with over four hundred vertebrates of both brackish and fresh water species, and over one million migratory waterfowls and shore birds. Over time a large number of flora and fauna have entered the list of endangered and vulnerable species. Chilika Lake is subjected to a multiplicity of pressures and impacts ranging from local to global geographical scales, impacting over short to very long periods, with effects on the quality and status of socio-economic life. The four major pressure indicators identified are population growth, globalisation, deforestation and ethnic conflicts. The state indicators are government intervention and regulations (including legal status), pricing of aquacultural products, agricultural practice and degree of urbanisation. The impact indicators are ecological decline (measured by several indicators), decline in aquacultural produce and growth of margins in the hands of middlemen. The paper presents an ecology-economy interactive model. It then goes on to a simulation of the model with various ecological and socio-economic and legal changes that impinge upon lake biodiversity. Lake sustainability indicators are monitored and possible policy interventions are identified. The most striking policy suggestion is to treat the problem as one of human rights for livelihood and population management, through which the trend in biodiversity decline can be reversed. Reducing the pressure of globalisation of course follows as the second best policy intervention.


James Randall Kahn
University of Tennessee, Knoxville, Tennessee, USA

Jill Caviglia
Economics and Finance Department, Salisbury State University, Salisbury, Maryland, USA

Carbon annuities as a policy to promote sustainable agroforestry and slow global warming

This paper examines a carbon annuity system (CAS) and its potential to encourage sustainable uses of forests, to internalise the deforestation externality, to retard global climate change, and to address equity issues associated with international environmental agreements. This paper begins by discussing the specification of the proposed carbon annuity system. Issues such as the distribution of the annuities, the role of the government, and welfare implications are addressed. The paper continues with simulations of possible reductions in deforestation rates that may result from the proposed CAS. A stratified random sample of 171 farmers, who live in Rondonia, Brazil, is used to estimate possible implication of the CAS. A majority of the farmers who live in Rondonia depend on slash-and-burn agriculture for their livelihoods, often leaving them with few land-use options. These farmers either deforest, find other sources of income, or go without food. A CAS could alter the costs and benefits of deforestation for individuals such as these farmers. The simulations are run for different values of a ton of carbon. For example, the modest taxes proposed by Nordhaus form a lower bound on the value of an annuity, the IPCC measure of damages form the base case, and less conservative measures of damages form the upper bound. Time paths of income from unsustainable agriculture, sustainable agriculture and sustainable agriculture with a CAS are compared to predict the rainforest preservation benefits of a carbon annuity system.


James Kahn
Department of Economics, University of Tennessee, Knoxville, Tennessee, USA

Steven Stewart
University of Tennessee, USA

Integrating ecology and economics: conjoint analysis and the Clinch Valley ecological risk assessment

Critical to the ongoing social assessment of environmental policy is a need for estimates of the tradeoffs individuals are willing to make to retain/restore environmental goods and services. We use conjoint analysis, a tool that measures individuals' preferences for bundles of goods having different attributes. In contrast to contingent valuation, which is the tool most commonly used to measure the economic value of environmental assets, conjoint analysis does not explicitly require individuals to state their willingness to pay for environmental quality. Rather, conjoint asks individuals to consider status quo and alternative states of the world. Conjoint is extremely useful for multi-dimensional changes - varying the level of the alternatives' attributes allows measurement of the individual's willingness to substitute one attribute for another. In our study, we ask individuals to consider the tradeoffs involved in protecting riparian ecosystems. We pose questions where individuals rate, rank and choose from scenarios which represent possible states of the world. Each state comprises attributes that have different levels. We include endangered species protection, recreational opportunities, mining and agriculture employment impacts, tax burden, and quality of life indicators. The results are compared with values obtained using traditional non-market valuation techniques. The use of conjoint has been legitimised in the U.S. by NOAA's proposed Habitat Equivalency ruling, which arose in part due to the criticisms that contingent valuation received during the Exxon Valdez damage assessment case. In particular, NOAA recommended conjoint analysis as a tool to measure in-kind compensation for damaged natural assets.


Melinda Kane
Rensselaer Polytechnic Institute, Troy, New York, USA

Rural community development: the New York City watershed case

The Catskill region of southern New York State is distinctive in that it combines private land use and public Forest Preserve in a watershed that is the primary source of drinking water for New York City. The City does not have a water filtration system, and relies entirely on the natural purification functions of Catskill ecosystems. A calculation of the replacement cost of these natural functions yielded a value of $US 6 billion to $US 8 billion in capital costs, plus annual operating costs of $US 300 million. In comparison, the protection and maintenance of the water purification function would cost just a fraction- approximately $US 1 billion - of these replacement costs. This example has been widely touted as a critical case of how society can attach economic values to ecological services. The need for comprehensive planning for land-use in this watershed has been described as a 'compelling example' of how 'economic development and prosperity hinge upon maintaining an adequate flow of essential services provided by natural ecosystems.'Local communities and land trusts are working together with New York toward a comprehensive private land use plan, which has been highlighted by the Trust for Public Land and in a report of the President's Committee of Advisers for Science and Technology. Rensselaer's technological expertise and program in Ecological Economics are helping to analyse the compatibility of industry and technology with environmental planning goals.


Minna-Maari Helena Karvonen
School of Business and Economics, Department of Environmental Management, University of Jyvaskyla, Finland

Alternative investment strategies and the win-win-rhetoric

The prevalent win-win-rhetoric proposes that situations can be attained where the environment and the economy simultaneously benefit. Achievement of win-win outcomes would imply development is moving in a sustainable direction. Several arguments for and against this proposition have been presented. One determinant in creating win-win-solutions is productive investments, which increase eco-efficiency. This paper quantifies the role of investments in shaping the ecological footprint of the Finnish pulp and paper industry between 1976-1997. Discussion is grounded on time-series, industry-wide data and on an empirically estimated emissions production function. The emissions production function studies all inputs and outputs of a process in the form G[Yi, . , Yn ;Ei. , En] = F[I1, . , Ik; Ik+1, . , Im] in which the outputs Yi, . , Yn are products with positive economic value, and Ei. , En are emissions and waste, which may or may not have a negative value. The inputs I1,..., Ik are man-made inputs, such as capital or labour, and Ik+1,..., Im are inputs from the natural environment. The function quantifies the environmental impacts associated with both the in- and the output sides of a production process. The discussion is further developed by comparing alternative investments strategies with the help of scenarios of a) the domestic situation with and without investments and of b) the differences in typical investment strategies between Northern Europe and North America. The comparison of investment strategies gives insight into industrial dynamics affecting the formation of emissions and indicates fruitful areas for policy planning and development.


Branton Kenton-Dau
Trucost Ltd, Christchurch, New Zealand

Alan Ambury
The Malleus Group, Christchurch, New Zealand

Ashley Sparrow
Department of Plant and Microbial Sciences, University of Canterbury, Christchurch, New Zealand

Ian Spellerberg
Lincoln University, New Zealand

Trucost: an index of sustainability for the marketplace

This paper outlines and discusses the method used to calculate the Trucost Index. The Trucost method has been developed from a goal-focussed approach and is founded on general principles of sustainability promoted by The Natural Step organisation. The method provides a simple means of assessment that utilises the financial records of input and output flows that all businesses keep. Opportunities and challenges regarding the implementation of the Trucost Index are discussed.


Neha Khanna
Dept. of Economics, Binghamton University, Binghamton, New York, USA

Measuring environmental quality: an index of pollution

This paper develops an index of environmental quality that facilitates the comparison of pollution levels across different regions and over time. The index draws upon epidemiological dose-response functions as well as a micro-theoretic welfare function in arriving at a rule to aggregate the ambient concentrations of pollutants into an overall index. The author illustrates the concept empirically by computing an index of air quality using 1997 data from 135 counties and Metropolitan Statistical Areas in the US. Ambient concentrations of different pollutants are aggregated into an index of air quality based on the marginal welfare losses due to increased pollution in conjunction with National Ambient Air Quality Standards and the health effect descriptor developed under the EPA's Pollution Standards Index (PSI). The results are surprisingly different from those obtained using the PSI methodology. Some regions with a PSI value of 100-200 are considered less polluted under the methodology developed in this paper than those with PSI values falling between 50-100. The key reason for the difference is that PSI values are determined entirely by the gas with the highest relative ambient concentration whereas the new methodology takes account of the ambient concentrations of all pollutants in computing the index value.


Rene Kleijn
Centre of Environmental Science (CML), Leiden University, The Netherlands

Emily Matthews
World Resources Institute, Washington, DC, USA

Stefan Bringezu
Wuppertal Institute, Wuppertal, Germany

Yuichi Moriguchi
National Institute for Environmental Studies, Tsukubashi, Japan

Marina Fischer-Kowalski
Institute for Interdisciplinary Studies of Austrian Universities, Austria

Weighing the losses: material outflow from industrial economies

In 1997 the World Resources Institute, the Wuppertal Institute, the Netherlands Ministry of Housing, Spatial Planning and the Environment, and the National Institute for Environmental Studies of Japan published a study with the Title: Resource Flows: The Material Basis of Industrial Economies. In this study the Direct Material Input (DMI) and the Total Material Requirements (TMR) of four industrial economies, the USA, Germany, Japan and the Netherlands were calculated and compared. In the autumn of 1998 a follow-up study was launched this time including the Department of Social Ecology of the Institute for Interdisciplinary Studies of Austrian Universities (IFF) and the Centre of Environmental Science (CML) of Leiden University. In contrast to the first study this follow-up study has been focussed on the material outputs of industrial economies. A time series (1975-1996) of the material outputs of these economies was calculated and for 1996 a more detailed mass balance was constructed. While the materials inflow has increased in most countries, the materials output has been constant over time. Both per capita and per unit of GDP the materials output decreased in most countries. Exceptions are Germany, where the reunification has increased the material output quite drastically, and Japan, where since 1985 the material output per capita has increased and the material output per GDP has remained constant. Other conclusions are: the atmosphere is the main sink for waste flows, CO2 is by far the largest outflow; the inflow is larger than outflow, the balance accumulates in the economies at fast rate; the main stocks are materials used in construction (roads and buildings).


Jorg Kohn
Bionautics Institute, Heiligenhagen, Mecklenburg Western Pomerania, Germany

Living with the environment: designing industry for sustainability

After ten years working with conceptualising sustainability on different spatial and time levels, observing processes within the ecological, social (cultural) and economic context, and teaching and learning from local and regional experience, we started interactive and integrative planning processes for redesigning abandoned industrial sites for sustainability. The idea behind designing industrial sites for sustainability is to use natural resources sustainable and to integrate functions of human live into a system that has the capacity to (re) organise and to adjust to changing environments. We based our studies on various models for regional economies and ecosystem functioning. Among them are models for regional economies by Johann Heinrich von Thünen, the classical models of T. R. Malthus, J. S. Mill, evolutionary economics of the Schumpeterian school, the findings of Eugene Odum and other ecologists, the work of Nicholas Georgescu-Roegen and E. F. Schumacher. The synthesis, however, that makes post-normal science a living science at the core is a practical model that derives from Fridjof Capra's synthesis on living nets. The paper will report on a process of redesigning an abandoned industrial site, relinking it with the regional economy, reinventing the principle of nearness, and making it to a living place for working, homing, and leisure activities. From our learning process we will draw conclusions on a changing framework of interaction of involved actors and institutions. Designing processes for sustainability and making sustainability a life principle resulted in an experience that shows that sustainability is about deep change rather than perpetuation of a 'sustainable' path.


Jouni Korhonen
School of Business and Economics, University of Jyvaskyla, Finland

On industrial ecology in ecological economics policy

There is a lack of applications of the Ecological Economics thesis in industrial environmental management. Recently however, we have become familiar with the concept of Industrial Ecology (IE) that adopts the ecosystem metaphor of 'roundput' in industrial environmental management. In industrial ecology an effort is made to consider the possibility of a systems approach to industrial systems, where waste material and energy flows are utilised between the actors in the system. This paper considers the obstacles that the implementation of the concept of industrial ecology faces. We consider the thesis with Environmental Life Cycle Assessment (LCA), namely a Life Cycle Inventory (LCI) case study in a paper recovery policy example. The recovery rates of paper are likely to rise considerably in the near future in industrialised countries. It is shown here that a rapid increase in the paper recovery rates of a national paper industry will create environmental, but also economic and social effects as growth in domestic production will require capacity building and recovery, transport, de-inking and production will provide lot of domestic employment opportunities. Therefore it is suggested here that industrial ecology as a systems approach for ecological economics policy needs to be based on the interdependency thesis regarding environmental, economic and social policy objectives.


Padma Lal
National Centre for Development Studies, The Australian National University, Canberra, ACT, Australia

Mangrove management: where to from here?

Concerns about ongoing degradation and irreversible reclamation of valuable coastal wetland systems continue despite concerted efforts taken at local, national and international levels. Many countries have become signatories to the wetland specific international convention, the Convention on Wetlands of International Importance (Ramsar, Iran, 1971) or the Ramsar Convention. This convention encourages the declaration of wetland sites of international importance and the development of national wetland policies, national wetland strategies and nation wetland action plans for these sites of international importance and other wetland areas. This paper, after briefly reviewing the Ramsar Convention and developing country response to it, discusses the underlying cause - the mismatch between mangrove ecosystems and human governance institutions - of the continued loss and degradation of mangroves. Amongst the symptoms of this mismatch discussed include: the presence of unclear ownership or use and management rights pertaining to wetland ecosystems; a general disregard for the spatial and temporal interconnectedness of wetland systems in use and management; disjunction between the reality of imperfect information and uncertainties in the nature of the link between human actions and the system's reaction and the government's traditional management approach. The paper then proposes an integrated and adaptive mangrove management (IAMM) framework, which addresses these and other issues, and suggests some guiding principles for a more effective mangrove management.


Padma Lal
National Centre for Development Studies, The Australian National University, Canberra, ACT, Australia

Open-format session. Panel-members: Kanchan Chopra, Neil Byron, Peter May, Mahfuz Ahmed, John Low, Meg Taylor, Agnes Rola

Achieving outcomes: making a difference in developing countries

This panel discussion follows on from the pleanry session on developing country issues. The key aim of the session is to identify lessons from developing countries and specific ecological economics challenges for the future - future directions, needs in research as well management to achieve outcomes. Each of the panelists will speak for about 5 minutes to their written paper of their country/regional experience in outcome oriented research and management of the environment or one of the resource sectors; lessons for the future and key challenges.


Geoff Lamberton
Southern Cross University, Lismore, NSW, Australia

Accounting for sustainable development at the organisational level

This paper reports on the results of applying an 'accounting for sustainable development' model to a single organisation, enabling the performance of the organisation in achieving the multidimensional objectives of sustainable development to be evaluated. The accounting model decomposes sustainable development into 5 measurable performance factors (eco-efficiency, ecological sustainability, and the sustainability of financial performance, and contributions to intergenerational and intragenerational equity) and utilises environmental performance indicators and life cycle analysis to measure performance against eco-efficiency and sustainability targets. The results of this analysis lead to the conclusion that economic priorities lead to specific aspects of the organisation's activities as being ecologically unsustainable. The paper concludes with an evaluation of the qualitative attributes of the environmental accounting information produced against the criteria of understandability, precision, cost-effectiveness and relevance to stakeholders.


Glenn-Marie Lange
Institute for Economic Analysis, New York University, New York, USA

Resource pricing and sustainable use in Southern Africa

The economies of three major countries in Southern Africa - Namibia, Botswana and South Africa - rely heavily on natural resources: minerals, fisheries, and water. These countries exhibit a variety of pricing policies towards resources: user charges for minerals have generally been adequate to recover resource rent in Botswana and Namibia, but not in South Africa. Less than half of the resource rent from Namibia's fisheries are recovered. In no country do user charges for water capture even the full financial cost, let alone scarcity or externalities. This paper provides an estimate of the economic value of natural assets in these three countries, and examines the economic incentives created by resource pricing policy for sustainable use of these resources. In the case of non-renewable resources, the paper examines whether Hartwick's rule is being followed: the reinvestment of a portion of the rent in activities to replace depletable resources. For renewable resources, the paper examines the extent to which user charges promote harvesting at an economically efficient level. Where countries have pursued other socio-economic objectives, such as Namibia's fisheries where equity and employment creation have been important determinants of policy, the paper provides an economic cost of the tradeoff between efficiency and alternative objectives. Finally, the influence of changing water-pricing policy on water use will be examined


Bibiana Lanzilotta Mernies
Fac. Ciencias Economicas, Universidad de la Republica, Montevideo, Uruguay

Jorge Campanella
Fac. Ciencias Economicas, Universidad de la Republica, Montevideo, Uruguay

Contingency valuation: sanitation tax as a solution for the subsoil contamination in Solymar (Uruguay)

Contingency valuation methods, known as direct or hypothetical methods, are based on asking people which monetary value they would assign to a certain environment good or, in the case of a negative externality, what compensation they would be willing to receive. There are few background studies on this issue in Uruguay, although some consultancies have been carried out about the implementation of a certain specific project. This research aimed at applying the methodology of Willingness to Pay (Contingency Valuation Method) as a way of estimating the economic value of 'sanitation' as an environment good in Solymar, a village in Uruguay. As the valuation method applied here establishes, a survey was carried out in the town that revealed the payment disposition of local households for sanitation. Traits of households and interviewed people were registered, thus enabling association of these different variables with their payment disposition. The research revealed that almost all the interviewed people were wary of the contamination problem. Most of them agreed with the proposed solution and were ready to pay for it. However, the community does not take efficient advantage of the annual amount raised, diverting it toward other purposes so that until now the problem has not been able to be dealt with.


Glen Lauder
Common Ground Associates, New Zealand

Paul Blaschke
Boffa Miskell Ltd, Wellington, New Zealand

Halting the decline in New Zealand's biodiversity - national challenge and bioregional response

New Zealand's first national State of the Environment report (1997) characterised the decline in indigenous biodiversity as the country's most pervasive environmental issue. In response, New Zealand's draft national biodiversity strategy released in early 1999 proposed a set of goals aimed at halting this decline. These goals were developed from among a spectrum of alternative goal levels. The draft strategy went on to propose a prioritised range of policy and other responses by which the goals would be translated into action. These responses were a range of voluntary, regulatory, economic and information mechanisms. A key proposal was the preparation of a national policy statement on biodiversity under the Resource Management Act (1991), targeted in particular on the effects of land management outside the conservation estate on biodiversity. This proposal would entail implementation by local government, amongst others; and sought to ensure the more effective use of non-regulatory approaches within the policy mix. This paper reviews the selection of the national goals and their translation to a bioregional level. A key consideration is the spatial scale at which biodiversity could be most effectively managed at a local level.


Philip Lawn
School of Economics, Flinders University of South Australia, Adelaide, South Australia, Australia

Ecological tax reform: many know why, but few know how

Ecological Tax Reform (ETR) involves the utilisation of the tax system to facilitate the movement toward Sustainable Development (SD). The generally accepted approach to ETR is to reduce taxes on income and labour and impose Pigouvian taxes on resource depletion and pollution emissions. Its aim is to encourage value-adding and the substitution towards labour in production as well as to induce a reduction in the intensity of resource throughput. While this approach is a vast improvement on the perverse incentives offered by the current tax system, it is an inadequate means of facilitating SD. This is because it relies exclusively on the manipulation of market prices - an allocation instrument - when ecological sustainability is a throughput problem requiring a separate policy instrument to be resolved. With the aid of a linear throughput representation of the economic process, it is argued that conventional ETR measures promote just two of the five behavioural modes put forward to achieve SD. In order to promote all five behavioural modes, it is argued that ETR is best conducted with the incorporation of tradeable resource depletion and pollution permits. The limit on the number of permits imposes a quantitative restriction on the rate of resource throughput (necessary to achieve ecological sustainability), while the premium paid for the permits by resource users and pollution emitters serves as a throughput tax necessary to ensure an efficient allocation of the incoming resource flow. In addition, since a government authority ideally auctions off the permits, the tax revenue can be used to rehabilitate degraded ecosystems and to correct inequitable imbalances between the rich and poor.


Clayton Ferreira Lino
The National Council for the Atlantic Rain Forest Biosphere Reserve, São Paulo, Brazil

Judith Cortesao
Federal University, Brazil

Partnerships aiming at the sustainability of the Brazilian Atlantic Rainforest

The great coastal rainforest of Brazil (Mata Atlantica) covered five centuries ago 15% of the national territory - only 8% of it survives. Even so its biodiversity is estimated as one of the highest in the world: 450-470 species of trees per hectare (Bahia and Espirito Santo States) and fauna diversity is similar, although many species are threatened by extinction. Urban development inside the rainforest and along the seashores has encroached upon and around the forest. 100 million Brazilians thrive inside the forest in thousands of towns and cities including Rio de Janeiro and Sao Paulo. Most of the great natural resource exploitation activities of Brazil - timber trade, sugarcane, coffee and others - have taken place in the Mata Atlantica. A great number of traditional communities (Indians, caboclos, quilombolas, peasants, shepherds, fishermen, craftswomen) are the endangered guardians of a most diverse cultural legacy and suffer as well the impact of an inadequate and hurried model of economic development. In the last few decades new ways of social, ecological and financial partnerships (including NGOs, universities, federal offices, private enterprises, local communities) seem to be arriving at a multi-faceted and encouraging way-out. Such partnerships have included quite a number of projects (eco-tourism, forestry management, deteriorated areas recuperation, private protected areas instrumentation, sustainable models of agro-economics, Mata Atlantica certified products) and such processes have already achieved some success. These experimental procedures have contributed to the development of new economical instruments, institutional reinforcement and public policies, aiming at the sustainability of the Brazilian Atlantic Rain Forest.


John Lintott
South Bank University, London, United Kingdom

Is development a story with a happy ending? Environmental and other Kuznets curves.

The environmental Kuznets curve (EKC) expresses the claim that as development - of the kind associated with ever increasing output -proceeds, environmental quality at first deteriorates but eventually improves. The empirical support for an EKC is quite thin: it is based on a small range of environmental impacts and on cross-sectional data. Empirical work has in fact done more to undermine than support the EKC thesis. In spite of this the 1990s have seen an avalanche of EKC papers, many making very large claims about the benefits of development for the environment. This calls for an explanation, which seems to reside in the EKC's ideological value. An EKC relationship must exist if development is to be defended. Like the family of Kuznets curves (dealing within equality and other possible consequences of development) of which it is part, the EKC expresses the idea that development, whatever rough patches it may encounter on the way, has a happy ending. No problem is created by development which further development cannot solve. However, to justify such a view requires not only EKCs, to demonstrate that environmental costs eventually decline with development, but also 'social Kuznets curves', showing that welfare improves. Preliminary evidence suggests that these will be no easier to establish. On the other hand the happy ending, which the environmental - and other -Kuznets curves are an attempt to encapsulate, may be possible, but only given quite a different type of development, based on redistribution rather than output growth.


Michael Loevinsohn
Natural Resource Management, International Service for National Agricultural Research, The Netherlands

Agnes Rola
University of the Philippines at Los Banos, Philippines

Policies, research and relevance: the case of pesticides and pest management in the Philippines

In the Philippines, pesticide use increased markedly during the 1970s and the 1980s, especially within smallholding agriculture. By the mid-1980s, reliable evidence was available of pesticides' negative impact on farmers' health, the aquatic environment, food quality and the economics of rice production. However, policy decisions commensurate with the scale of damage that research was projecting were only taken with significant delay. These included a ban or severe restriction on several popular but highly toxic insecticides in 1992, and the launch of farmer training programs in Integrated Pest Management (IPM) in 1993. This paper seeks to identify the causes of this delayed policy response. It describes an analytical framework highlighting the importance of coalitions and their conflicting notions of information quality and relevance where research touches on entrenched interests. Empirical evidence comes from literature and interviews with 29 persons centrally involved in the 1992-93 decisions or with insights into the decision-making process. With respect to the regulatory decision, arguments based on health hazards proved the most influential, but only in a changed political environment in which media and civil society groups found a role and could keep the issues on the policy agenda. Support of Agriculture Secretaries and the President was essential when the decision met strong resistance. Evidence also suggests that individuals and their organisations had earlier opportunities to advance decisions but that these required personal courage and leadership, which the prevailing political and institutional environments discouraged. The paper draws several conclusions relevant to similar situations where 'business as usual' research-policy linkages are unlikely to be effective.


Sarah Lumley
Department of Geography, The University of Western Australia, Perth, Western Australia, Australia

Marion Hercock
Department of Geography, The University of Western Australia, Perth, Western Australia, Australia

Joe Bryant
Department of Geography, The University of Western Australia, Perth, Western Australia, Australia

Perceptions of economics and the environment: the views of ordinary people

Since 1997 in Australia there has been a number of policy debates with environmental and social justice implications. These have included: Australia's national policy on binding greenhouse gas emissions targets; the Native Title Amendment Bill; the establishment of the Jabiluka Uranium Mine in Kakadu National Park; and the contracting of Regional Forest Agreements (RFAs) that have determined plans for logging Australia's old growth forests. Almost without exception the justification for implementing such policy has been the 'economic' good of the nation. However, there has been little enquiry about how the ordinary people of Australia interpret such rhetoric: Do they agree that 'economics' is what is good for them? Do they have any comprehension of the theoretical underpinnings of economics? How do they perceive the relationship between economics and conservation? How do they perceive equity aspects of economics? What do they think of generating private profit from public environmental resources? In mid-1998, against the backdrop of heated debate on all of the above public policy issues, residents of six socio-economically distinct areas of southwest Western Australia were randomly surveyed. Their perceptions of a number of economic, social and conservation issues relating to Australian public policy and use of publicly owned environmental resources were assessed. The areas surveyed included the poorest and the wealthiest parts of metropolitan Perth, and the Southwest Region of WA, where the RFA debate is focussed. Correlations between perceptions and socio-economic status were also assessed. Results challenge stereotypes of how conservation and the environment are valued by ordinary people in different socio-economic classes; how people perceive equity aspects of economics and the environment; and how people perceive economics itself. Many of the survey responses appear to be normative: for a large majority of people surveyed, their perceptions of economics are not consistent with the assumptions about human behaviour embedded in standard economic theory.


Margareta Lundin
Environmental Systems Analysis, Chalmers University of Technology, Göteborg, Sweden

Sverker Molander
Environmental Systems Analysis, Chalmers University of Technology, Göteborg, Sweden

Greg Morrison
Water, Environment and Transport, Chalmers University of Technology, Göteborg, Sweden

LCA based indicators for sustainable development of urban water systems

Water in urban areas is a key issue for sustainable development (SD) while approaches to facilitate decision-making and communication at the municipal or company level are scarce with regard to overarching concepts such as SD. The fundamental problem for the development of SDIs is to reduce the number of relevant parameters, which have bearing on SD and to establish routines for collecting and handling data, which include their use and communication. This proposal provides an LCA based approach, complemented with a strategy based on assessment of efficiency and service demand, which will allow organisations dealing with urban water systems, to choose technologies and technical systems towards sustainability in their specific setting but still in a scientifically valid way.


Narasimhamurty Maddipati
Institute of Economic Growth, University of Delhi, New Delhi, India

A. J. James
Institute of Economic Growth, University of Delhi, New Delhi, India

Measuring non-user benefits from cleaning Ganges, the most important river in India, using contingent valuation methods.

The implementation of a carefully designed survey in eleven major cities in India evoked an unexpectedly good response from the urban households about their valuation of non-user benefits or the existence and bequest values from an unpolluted Ganges. In order to estimate the household willingness to pay as a function of river quality, the contingent valuation survey is designed such that the households are asked to reveal their preferences for three levels of river quality: the quality of river before the clean up started, the current quality, and the bathing quality which is supposed to be achieved after the clean up is completed. The estimated willingness to pay function, as expected, shows that the household willingness to pay increases with the river quality, and the income, size and environmental awareness of the household. The estimated average annual willingness to pay of urban households is Rs 557.94 for the river of bathing quality, while it is Rs 101.48 for the quality of river before the cleanup. The annual incremental benefits from the clean up of the Ganges for 8.733 million households from the urban literate population in 23 major cities in India are estimated as Rs 4021.138 million.


Ilmo Maenpaa
Thule Institute, The University of Oulu, Finland

Artti Juutinen
The University of Oulu, Finland

Explaining the material intensity in the dynamics of economic growth: the case of Finland

The paper is based on a research project where the time series of Finland's Total Material Requirement (TMR) in 1970 - 1997 were collected. For the year 1995, a thorough cross-sectional survey was made of the use of materials by industries and the final demand categories, in order to relate the physically measured material use to the 1995 input-output tables. The changes and trends in the material intensity of the Finnish economy and its different sectors are shown and explained. It is shown that the material intensity (direct plus indirect) tends to fall towards the refining chains of the industries. It is also shown how the shifts in the shares and the changes in the internal structure of the main final demand categories - consumption, capital formation and exports - affect the material intensity of the economy. The share of services in the economy grew steadily up to 1990. After the recession of the Finnish economy in the first half of the 1990s, the recovery has been rapid and fast growth still continues. Contrary to the old growth patterns, the growth of manufacturing industry has been and continues to be faster than that of services. Within the manufacturing industries, the growth is mostly due to the high-tech branches. The effects of this new growth pattern on the material intensity of the economy are analysed and the possibilities of its continuation in the future are discussed.


Majid F. Makhdoum
Department of Environmental Planning & Management, Faculty of Environment, The University of Tehran, Iran

Introducing an approach for the computation of forest allowable cut

Traditionally, allowable cut (AC) in Iran is computed on the basis of average tree increment in a unit area of forest. Then the average increment is simply multiplied by the area of forest district, which would result in the AC of the forest district. In this approach, the whole forest district is considered homogenous, when the AC is applied for tree marking in the later cutting operations. Such a procedure has resulted in overcut in some areas, which are not ecologically capable for the amount of AC to be cut. In turn, in some ecologically capable areas it has caused undercut, which is not economically viable. A new approach is introduced to overcome these over and undercut in forest districts of Iran. First, a forest district is divided into homogenous areas of arbitrary ecosystems (Makhdoum, 1992). Second, in every arbitrary ecosystem, forest ecological capability would be evaluated, classified, and mapped. Then, for every capability classe of the forest district the AC would be computed. By this approach tree marking would be based on the actual forest ecological capabilities, which are shown on the capability map, rather than on an average figure for the whole district. With the application of this approach it is anticipated to resolve the over and undercut problems of forest areas of Iran, and lead forest management towards sustainability. The application of the introduced approach for a forest district of Iran is presented.


Thilak Mallawaarachchi
James Cook University, Townsville, Queensland, Australia

John Quiggin
James Cook University, Townsville, Queensland, Australia

Sam Ebert
James Cook University, Townsville, Queensland, Australia

Integrated assessment methods for land-use planning: combining economic, environmental and social objectives

Land-use planning is an effective management tool for guiding efficient resource allocations when environmental and economic objectives are jointly pursued. The development of land-use plans requires multidisciplinary input to design and evaluate plans that are efficient, equitable and operationally feasible. Advances in the Geographic Information Systems technology has enabled the capture and analysis of integrated resource data sets over extensive areas to handle complexity and spatial variability of bio-physical parameters in planning. While biophysical data are important in determining potential resource use options, one important difficulty in planning is to value benefits of environmental preservation in a manner that is useful for integrated assessment. In this paper, we present an integrated assessment method that combines economic analysis, spatial analysis and choice modelling techniques for developing socially optimal land use plans for a cane growing catchment in Northern Australia. The dynamic regional land use model, CLAM implements the Krutilla-Fisher algorithm for total economic valuation. The model is used to simulate alternative land allocation options for a cane growing catchment and resulting economic-environmental trade-offs are analysed under alternative assumptions for sugar prices and planning restrictions.


Jack Manno
College of Environmental Science and Forestry, Great Lakes Research Consortium, State University of New York, Syracuse, New York, USA

Privileged goods: commodity potential as a concept for understanding and overcoming the barriers to a sustainable economy

At the heart of the sustainability challenge lies the reinvention of prosperity so that societies can achieve it with less resource usage per unit of welfare and in the aggregate. This paper summarises a new book by the author published in 2000 as part of the ISEE book series with CRC Press. It provides a means for understanding the process by which individual and social welfare have become tied to increasingly high levels of material and energy consumption and its accompanying waste products. It explores the process, termed commoditisation, through which goods and services with high commodity potential are systematically privileged as means of satisfying human needs and aspirations. This systematic preference amounts to a selection process which drives the evolution of the human economy towards increasing commoditisation and a corresponding increase in the mobilisation of the earth's material and energy resources, a trend in the exact opposite direction from what is recommended as the path toward sustainable development. This paper describes the social and political implications of commoditisation, and offers a definition of oppression as the systematic denial of attention and resources to non-commodity non-commercial goods and the people who provide and depend on them.


Graham Marshall
School of Economic Studies, University of New England, Australia, Armidale, NSW, Australia

Contributions of informal governance to natural resource management: evidence from a survey of Australian farmers facing irrigation salinity

Land and Water Management Plans developed for the four irrigation districts surrounding Deniliquin in the River Murray catchment are said to be at the leading edge of Australian institutional arrangements for integrated resource management. Farmers have been strongly involved in the development of the Plans and in deliberations regarding their implementation. Implementation accountabilities have been devolved to Murray Irrigation Limited, a company wholly owned by its irrigator customers. The Plans primarily focus on an emerging 'tragedy of the commons', with the area's soils predicted to become increasingly degraded by salinisation unless local cooperation is achieved in limiting watertable recharge. The irrigator-owned company can thus be regarded as a common property regime in so far as its watertable management function is concerned. The 'community ownership' rhetoric behind these institutional developments seems to signify an attempt to come to terms with the high, often prohibitive, transaction costs typically associated with formal governance of a common-pool resource. The reasoning appears to be that local human and social capital is the key to finding institutional arrangements which realise the potential of local informal capacity for self-organisation and thereby lessen the need for formal governance. In an effort to go beyond anecdotal evidence of the alleged contribution of 'the informal' in this instance, a face-to-face survey of 235 farm businesses was undertaken. This allowed the influence of various products of social capital, including trust, reciprocity and norms, on both farmer commitment to, and intention to comply with, their district's Plan to be tested empirically. Findings are discussed in the paper.


David Martin-Barroso
Spanish Council for Scientific Research, Madrid, Spain

Alejandro Caparros Gass
Spanish Council for Scientific Research, Madrid, Spain

Economic evaluation of different forestation scenarios in the Spanish Dehesa through application of an optimal control bioeconomic model

A dehesa is a large private farm multiple use agroforestry system that results from long term use of grazing resources found in the Mediterranean forest of the West and Southwest Iberian Peninsula. Public incentives derived from application of EU regulation 2080/92 for the afforestation of abandoned agricultural land has resulted in an immediate reaction by the private sector, carrying out afforestation in dehesas with cork oaks (Quercus suber L.) and holm oaks (Quercus ilex). This paper aims to evaluate the economic implications derived from imposing certain economic and environmental restrictions on dehesa management. Different policy schemes are also considered and their effects on management studied. In order to attain these purposes, an optimal control bioeconomic model for four dehesa estates in West Spain, covering cork oaks, holm oaks, Iberian pigs, Merino sheep, cows, and goats is developed.


Joan Martinez-Alier
Economics and Economic History, Autonomous University of Barcelona, Spain

Ecological distribution conflicts, sustainability and valuation: ideas on the relations between political ecology and ecological economics

Against the hopes of the believers in eco-efficiency and 'dematerialisation', economic growth unfortunately means increased environmental impacts which, before there is time to redress them through economic policy or changes in technology, are sometimes felt disproportionately by some social groups. In this paper, historical or present conflicts on oil extraction in the Tropics, pollution from copper-mining, the use of mangroves for livelihood, biopiracy and biosafety, 'environmental racism' in the United States and South Africa, and property rights on carbon sinks, will be briefly described. Such ecological distribution conflicts are studied by Political Ecology, a new field created by geographers, anthropologists, and environmental sociologists. I shall conclude that the growing movement for Environmental Justice (rural and urban, local and global), which arises from such ecological distribution conflicts, may help to move society and economy towards sustainability. This is then one first connection between Political Ecology, as the study of ecological distribution conflicts, and Ecological Economics as the science and management of sustainability. There is also a second connection. Ecological distribution conflicts are sometimes expressed as discrepancies of valuation inside one single standard of value (as when there is a disputed claim for monetary compensation for an ecological debt), but they often lead to multi-criteria disputes (or dialogues) which rest on different standards of valuation. When the study of an ecological distribution conflict reveals a clash of incommensurable values, then Political Ecology is contributing to the development of an Ecological Economics which moves beyond the obsession of 'taking Nature into account' in money terms, and which is able to cope with value pluralism.


Peter May
Federal Rural University, Rio de Janeiro, Brazil

Fernando Veiga Filho
Federal Rural University, Rio de Janeiro, Brazil

Osmar Chevez-Pozo
Federal Rural University, Rio de Janeiro, Brazil

Valuation of biodiversity in Brazil: state of the art and a research agenda

This review of recent studies of biodiversity valuation in Brazil was undertaken to guide elaboration of the National Strategy for Biological Diversity in response to the Convention on Biodiversity. The review encompasses 51 studies, in a range of categories, including: financial-economic analyses conducted to justify investment in sustainable enterprises for management of natural resources; eco-tourism and implementation of conservation areas for direct and indirect use; economic values to strengthen arguments for the preservation of biological diversity; justifications for international transfer of financial resources to compensate the global benefits assured by national investments in conservation of biodiversity; measures to define compensation payments for recovery of damages due to degradation of natural resources by economic activities; and exercises in environmental valuation accomplished as part of dissertation studies in Brazil and overseas. The paper presents a comparative analysis of the studies reviewed, according to the methodological approach they adopt, biodiversity resources valued, and monetary values attributed to them. The following valuation categories were identified: eco-tourism and sport fishing expenditures or contingent values; off-site benefits from environmental recuperation investment; ecosystem services or damages to artisanal fisheries incomes; sustainable non-timber forest product income flows; benefits from preservation of natural resources and local/regional ecosystem services; damage costs due to recovery of environmental damages. In conclusion, the authors identify a number of gaps in the literature relative to specific understudied biomes in Brazil, and issues meriting further research. In particular, they propose that valuation analyses guide the establishment of incentives to motivate biodiversity conservation by local resource users who are otherwise compelled to over-exploit or destroy resources of global significance.


Kozo Mayumi
Faculty of Integrated Arts and Sciences, University of Tokushima, Japan

John M. Gowdy
Rensselaer Polytechnic Institute, Troy, New York, USA

The foundation of consumer choice theory and environmental valuation

The burgeoning field of environmental valuation has raised serious questions about the fundamental axioms of utility theory. This chapter examines the basic axioms of consumer choice theory paying particular attention to the contributions of Georgescu-Roegen. We argue that evidence from consumer surveys reveals a more complex pattern of decision-making than that described by standard utility theory. We discuss the notions of preference invariance, non-satiation, complementarity and lexicographic preferences. We extend the axioms of consumer choice by introducing the concepts of hierarchy of wants and probabilistic binary choice. We argue that these extensions are necessary to account for consumer choices revealed in environmental valuation surveys.


Carl N. McDaniel
Biology Department, Rensselaer Polytechnic Institute, Troy, New York, USA

John M. Gowdy
Economics Department, Rensselaer Polytechnic Institute, Troy, New York, USA

Nauru: a failure of weak sustainability

Our global economy is in fundamental conflict with the preservation of biodiversity and human well-being as illustrated by the history of Nauru Island in the central Pacific. Weak sustainability stipulates an economy is sustainable if its capacity to generate income for future generations, a capacity embodied in its capital stock, is maintained. The assumption of substitutability among different kinds of capital is crucial to weak sustainability. When, as in neoclassical theory, natural capital (non-renewable resources and ecological functions) and manufactured capital are considered substitutes, it is permissible to focus only on total capital stock. Weak sustainability is achieved if an economy saves more than the combined depreciation of the various kinds of capital, even if it draws down its stock of natural capital. Nauru is an instructive example of weak sustainability. In 1900 phosphate was discovered, and today 80% of the island is totally devastated. Biodiversity loss and weediness are as predicted: only 55 of 487 plant species are native, 27 of the 55 are threatened or extinct, and 17% are weedy. The people of Nauru have severe health problems, yet in the 1980s they had a very high per capita income and Nauru had an estimated sustainability index that is the highest in the world. Nauru's current situation and its future prospects illuminate the interdependent relationships among markets, ecosystems, and human well-being, and illustrate the complexity of the arguments for and against weak sustainability. It also shows the weak sustainability criteria are consistent with near complete environmental devastation.


Garry McDonald
McDermott Fairgray Group Ltd, Takapuna, Auckland, New Zealand

Murray Patterson
Massey University, Palmerston North, New Zealand

Ecological footprints and the interdependencies of New Zealand regions

The ecological interdependencies of New Zealand regions are quantified by using ecological footprint calculations. These 'ecological footprints' are calculated from regional-level ecological input-output models for each of New Zealand's 15 local authority regions. The components of the ecological footprints, in terms of energy, food, forest and imported 'land' are made explicit in these calculations. Other ecological footprint indicators are discussed as alternatives to the 'embodied land' based indicators. For example, the use of 'embodied energy' footprint indicators is canvassed. The paper concludes with a discussion of the usefulness of these footprint indicators in policy analysis, drawing on illustrative examples from the New Zealand analysis.


Andrea Melo
Federal Rural University of Pernambuco, Brazil

Sustainable agriculture: an index estimation

The aim of this work is to define a sustainability index in an agricultural development situation. This index is validated by an empirical application to the small farmers of the CODEVASF irrigation projects in the San Francisco Valley in Brazil. Due to the multiplicative effects of these projects (agroindustrialisation), the Valley has been appointed as one of the few development alternatives to the Brazilian northeast. Sustainable agriculture is seen in this work as a conjunction of economic, social and ambiental factors, which are expressed by physical indicators. The driving force-state-response indicators structure is used and properly defined with respect to the specific agroecological characteristics of the area of interest. The principal components method is used to aggregate the state indicators into a single index. A linear regression model is used to relate the driving force and response indicators to the sustainability index. The worst indicators performance were found for the preservation of native vegetation and inter-cropping. The sustainability index indicated a situation that was classified as a jeopardised sustainability situation. Land property concentration, human infection by diseases, wage differences between genders, productivity and the increase of temporary employment relative to permanent employment, are the principal elements of this threat.


Susan Mesner
Department of Economics, Rensselaer Polytechnic Institute, Troy, New York, USA

Tourism and recreation in Vermont: How stable? How sustainable?

With the U.S. economy increasingly dominated by services, ecological economists are turning to the question of the sustainability of non-manufacturing economic activities such as tourism. The state of Vermont offers a particularly interesting case to examine the interactions between the economic, social and environmental impacts of tourism and recreation. Using a Social Accounting Matrix (SAM) framework this paper examines the place of tourism in the structure of Vermont's economy. Issues examined include (1) the role of the natural environment as an 'input' to economy activity, (2) the question of whether the tourism and recreation industry is a stabilising or destabilising factor in Vermont's economy, an (3) the application of concepts from ecology such as resilience to examine economic structure.


Per Mickwitz
Finnish Environment Institute, Helsinki, Finland

Environmental policy instruments and innovations

It is clear that moving towards sustainable development will require large changes in production. These changes will require that new processes and technology are widely brought into use, i.e. innovations are made and diffusion takes place. It is, therefore, important to have a clear picture of how environmental policy instruments affect innovations and their diffusion. Economic theory has argued that economic instruments, especially taxes, are superior with respect to innovations, since they impose a cost on the pollution irrespective of its level. Direct regulation have been criticised for not providing incentives for innovations or even hindering diffusion, and information based instruments have hardly been considered at all. When theory has been developed this picture has changed. This study will combine a literature review with empirical evidence on the Finnish experiences of the effects of different policy instruments on innovations and their diffusion. A major question will be to determine to what degree the Finnish permitting system has been technology forcing. The main source of information for the empirical part of the study will be thematic interviews with firm representatives, authorities and other experts, such as researchers and consultants. In addition to these interviews information about the adoption of the technologies will be traced from documented sources; e.g. permits and studies.


Per Mickwitz
Finnish Environment Institute, Helsinki, Finland

Is it as bad as it sounds or as good as it looks? The experiences of Finnish water permits

Wastewater discharges by Finnish industry have been mainly regulated by permits. The permits contain limits and requirements individually designed for each plant taking into account the ecological characteristics of the specific site as well as the technological and economical features of the plant. From the perspective of neoclassical economic theory this sounds bad. Despite large increases in production, water discharges by the Finnish pulp and paper industry have decreased drastically during recent decades. For example, the biochemical oxygen demand discharges were in 1997 less than 10% of what they been in 1982. This looks good, no wonder that both the administration and industry uses this as an example of how well the regulatory system is working in Finland. This paper will explore both stories. Based on a review of the recent economic literature, a more detailed and thus less dark theoretical picture of permits will be presented. Based on empirical research a far more complicated picture of the Finnish permit system than the 'success story' usually exported will be present. The empirical research will, at plant level, examine the discharges and permit limits of the pulp and paper industry. The statistical analyses of the plant level time series will be combined with results of thematic interviews with firm representatives and authorities. This shows that permit conditions are only one of several factors behind the reduced discharges. The study argues that by combining quantitative and qualitative research methods more information can be gathered than by using the methods separately.


Zhanna Mingalyova
Perm State University, Perm, Russia

Svetlana Tkashyova
Perm State University, Perm, Russia

Ekaterina Boussyreva
Perm State University, Perm, Russia

Impact of regional environmental policy on sustainable regional economic growth

Sustainable regional economic growth under worsening ecological conditions is one of the main problems of Russia and its regions. The current reality is such that successful social-economic development has to be accompanied by guarding and improving the ecological environment. There are more declarations then activities in this field because of the absence of financial support. The Perm Region (Oblast) is a traditional industrial region. As in Russia as a whole, the region suffers from the difficulties of economic development and increasing ecological tension. However, in spite of these difficulties, the Perm Region is to be a region-donor financing other regions of the Russian Federation. That is why the solving of ecological problems and issues of sustainable regional economic growth are significant. The Perm Region Administration is very active in providing laws aimed at guarding the ecological environment. In the last year atmospheric pollution has declined by 20%, the volume of utilised toxins has increased by 13% etc. The main effort is devoted to regional programs. The budget consists of 78% enterprise financing, 15% regional and local ecological funds, and 7% regional and local budgets. The annual volume of these investments is about 400 billion rubles. The Regional Administration is working on a Law 'on ecological entreprenuership', which can help to improve the ecological situation and business activities in this field. An increase in the main regional macroeconomic indicators could follow as well as a weakening of social tension.


Toshiaki Mizuno
Doctoral Program in Policy and Planning Sciences, University of Tsukuba, Ibaraki, Japan

Saburo Ikeda
Institute of Policy and Planning Sciences,University of Tsukuba, Ibaraki, Japan

Satoyama ecosystem in Japanese farmland: from the sustainable landscape to the collapse of biodiversity

Satoyama is a word denoting the typical traditional landscape of Japanese farm lands, which consists of coppice, paddy fields and villages. The system of satoyama has been formed for making our rice production system sustainable for more than thousand years. In spite of long-term anthropogenic impacts on the satoyama ecosystem, it has been well managed under the spirit of co-habitation with nature. Hence, the satoyama ecosystem used not only to be rich in biodiversity but also used to play a very important role for making local communities sustainable in terms of recycling the materials and energy associated with rice production. However, for the past three decades, the satoyama ecosystem has faced not only a decrease of spatial extent due to urbanisation, but also serious changes in agricultural practices in terms of less labour employment, and more energy and material use with a shift from traditional materials to industrial/chemical ones. This trend has accelerated the collapse of the ecosystem from a sustainable one to a vulnerable one. A variety of biological creatures now face a threat of extinction. This paper is concerned with the process of transition of the satoyama ecosystem from a sustainable state to a vulnerable state. The interrelation between recent economic growth and collapse of the satoyama ecosystem are shown by using socio-economic data such as GDP, land area, land price and expenditure of local government, and so on. Finally, we will discuss the economic value of the satoyama's function for making the local community sustainable in terms of energy and material use with recycling.


Mohan Munasinghe
University of Colombo, Sri Lanka

Sustainomics: a transdisciplinary framework for making development more sustainable applied to climate change

Sustainable development is one of the most important challenges facing humankind. The concept has evolved to encompass three major points of view: economic, social and environmental. There is no single overarching framework for sustainable development, but this paper attempts to describe sustainomics as a transdisciplinary comprehensive, holistic, and balanced framework for making development more sustainable. The approach seeks to synthesise key elements from traditional disciplines, as well as methods that cross the economy-society-environment interface. While building on earlier work, sustainomics constitutes a more neutral expression that focuses attention explicitly on sustainable development. The precise definition of sustainable development remains an elusive goal, but the less ambitious incremental strategy of seeking to make development more sustainable, offers greater promise -- because many unsustainable activities are often easier to identify. The approach is illustrated through practical application to several key issues involving global climate change.


Kees Musters
Environmental Biology, Institute of Evolutionary and Ecological Sciences, Leiden University, The Netherlands

H. J. De Graaf
Environmental Biology, Institute of Evolutionary and Ecological Sciences, Leiden University, The Netherlands

W. J. ter Keurs
Environmental Biology, Institute of Evolutionary and Ecological Sciences, Leiden University, The Netherlands

Is it possible to operationalise 'biodiversity' from the point of view of stakeholders?

According to the Convention on Biological Diversity, biodiversity is an all-encompassing concept, including all ecological, taxonomic, and genetic diversity present on Earth. This definition does not indicate how to spent the limited funds available for conserving biodiversity. As a consequence, any policy aimed at the conservation of biodiversity in a certain area must start with the selection of a limited set of conservation targets. The Convention also states that 'biodiversity' is of common interest to all people. Therefore, we consider this selection as a political issue in which, according to democratic principles, all people should participate. How can such participation be accomplished? Is the selection to be done by experts that ensure that the interests of the people involved are covered? Is the relation between these interests and the components of biodiversity known? Or should stakeholders select the conservation targets? But what if this leads to a set of targets that does not cover the intentions of the Convention? How, in any case, can such coverage be checked? To study these questions, we developed a procedure for operationalising 'biodiversity' from the point of view of the stakeholders. The procedure was tested in three cases. The first one deals with one stakeholder: biodiversity for recreation in a Dutch rural area. The second and third with a number of different stakeholders: biodiversity of the urban area and biodiversity of the Wadden Sea. The results of these studies will be used to discuss the conceptual and practical problems involved in operationalising biodiversity with the aid of stakeholders.

Author: David Stern
Date Last Modified: 29 June 2000
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