252
The authors of the present book note that no
matter how more realistic GPI is in expressing
social welfare than GDP, its calculation is rather
complicated, and that is why it is not widely used
and its future application remains doubtful. A
number of other indices are used for more or less
similar purposes. A widespread indicator, simple
to calculate is Human Development Index (HDI)
introduced by UN. This takes three factors of
human development into account:
• life expectancy at birth,
• ratio of literate and educated population and
• GDP per capita in U.S. dollars at purchasing
power parity. The primary deficiency of the
index compared to GPI is that it takes no
account of environmental effects while still
including the distorting effects of GDP.
According to Talberth (2008) sustainable
development could be realised if 5-5 macro- and
microeconomic objectives are achieved.
Macroeconomic objectives are the following:
1. genuine human progress: promoting genuine
progress based on multiple dimensions of
human well-being;
2. renewable energy platform: fostering a rapid
transition to a renewable energy platform;
3. social equity: equitable distribution of both
resources and opportunity;
4. protecting and restoring natural capital (where
possible);
5. economic localisation.
(a). Widening gap between GPI and GDP—
so-called threshold effect—suggests
unsustainable economy. Sustainable
development can only be realised if the
threshold effect ceases. Other similar
macroeconomic indicators like the happy
planet index (HPI) showed that welfare—
reaching over a certain level—is not
dependent on the high level of
consumption.
(b). Changing over to renewable energies
started, but the process is far from progressing fast. Governments of certain
countries support or hinder the process
differently. The process is further delayed
by companies interested in the use of fossil fuels.
(c). Reducing social inequities requires two
key dimensions. On the one hand, equitable distribution of resources, and on the
other hand, equitable access to healthcare, education, cultural amenities and
economic opportunities. (According to
the authors of the present book, this
objective is probably the hardest to
achieve.)
(d). A fundamental statement of environmental economists is that if society is to survive, it must live on the interest, not the
capital of nature. Survival of natural capital and ecosystem service flows is a prerequisite for sustainable development as
resources required for the operation of
the economy can be supplied permanently in this way.
(e). Economic localisation means the more
effective use of local resources and
decreasing dependence on global economy. One index expressing the degree of
localisation is “miles to market”. In the
case of locally grown food, for example,
short route has to be travelled for the
product to the consumer thus carbon
dioxide emission of transport is reduced,
refrigeration is unnecessary, packaging is
simpler, etc. (The authors note, however,
that realising this objective would require
a significant transformation of global
trade, the feasibility of which is strongly
doubtful.)
Microeconomic objectives:
1. certification of products, operations and supply chains;
2. zero waste;
3. eco-efficiency;
4. workplace well-being;
5. community vitality.
(a). A burgeoning movement aims to certify
products by independent professional
organisations that products are produced
6 Steps Towards Realising Global Sustainable Development
The authors of the present book note that no
matter how more realistic GPI is in expressing
social welfare than GDP, its calculation is rather
complicated, and that is why it is not widely used
and its future application remains doubtful. A
number of other indices are used for more or less
similar purposes. A widespread indicator, simple
to calculate is Human Development Index (HDI)
introduced by UN. This takes three factors of
human development into account:
• life expectancy at birth,
• ratio of literate and educated population and
• GDP per capita in U.S. dollars at purchasing
power parity. The primary deficiency of the
index compared to GPI is that it takes no
account of environmental effects while still
including the distorting effects of GDP.
According to Talberth (2008) sustainable
development could be realised if 5-5 macro- and
microeconomic objectives are achieved.
Macroeconomic objectives are the following:
1. genuine human progress: promoting genuine
progress based on multiple dimensions of
human well-being;
2. renewable energy platform: fostering a rapid
transition to a renewable energy platform;
3. social equity: equitable distribution of both
resources and opportunity;
4. protecting and restoring natural capital (where
possible);
5. economic localisation.
(a). Widening gap between GPI and GDP—
so-called threshold effect—suggests
unsustainable economy. Sustainable
development can only be realised if the
threshold effect ceases. Other similar
macroeconomic indicators like the happy
planet index (HPI) showed that welfare—
reaching over a certain level—is not
dependent on the high level of
consumption.
(b). Changing over to renewable energies
started, but the process is far from progressing fast. Governments of certain
countries support or hinder the process
differently. The process is further delayed
by companies interested in the use of fossil fuels.
(c). Reducing social inequities requires two
key dimensions. On the one hand, equitable distribution of resources, and on the
other hand, equitable access to healthcare, education, cultural amenities and
economic opportunities. (According to
the authors of the present book, this
objective is probably the hardest to
achieve.)
(d). A fundamental statement of environmental economists is that if society is to survive, it must live on the interest, not the
capital of nature. Survival of natural capital and ecosystem service flows is a prerequisite for sustainable development as
resources required for the operation of
the economy can be supplied permanently in this way.
(e). Economic localisation means the more
effective use of local resources and
decreasing dependence on global economy. One index expressing the degree of
localisation is “miles to market”. In the
case of locally grown food, for example,
short route has to be travelled for the
product to the consumer thus carbon
dioxide emission of transport is reduced,
refrigeration is unnecessary, packaging is
simpler, etc. (The authors note, however,
that realising this objective would require
a significant transformation of global
trade, the feasibility of which is strongly
doubtful.)
Microeconomic objectives:
1. certification of products, operations and supply chains;
2. zero waste;
3. eco-efficiency;
4. workplace well-being;
5. community vitality.
(a). A burgeoning movement aims to certify
products by independent professional
organisations that products are produced
6 Steps Towards Realising Global Sustainable Development