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values of capital stocks that has not been fully translated into the environmental
extensions of national accounts. There is a substantial literature on the valuation of
natural and anthropogenic capital, but there is a strong tendency to use a common
denominator of monetary value or utility. Important physical information is then
lost. For example, there is a world of difference between having a small amount of
high quality, recently built road, and a much larger quantity of ageing, highly depreciated road that will soon be due for repair or replacement; the way capital value is
determined means these two situations could be equivalent in net worth but they are
very different in the services they provide and in their long-term material and energy
requirements.
Concentrating on the fl ow measure of GDP is rightly criticised as a false measure
of human well-being, which might be better defi ned by the accumulation of capacity to provide employment, food, education, safety and security, an approach
explored in Chap. 8 . That capacity corresponds more with the quantity and quality
of infrastructure, productive and non-productive capital stocks. Stocks are not
merely the accounting residuals of the net difference in bulk material fl ows. Through
the services they provide, stocks are indicators of physical wealth, and our ability
(through fl ows) to maintain and sustain that wealth is equally an important dimension of reporting and modelling the physical aspect of human well-being.
Just as seeking greater wealth by increasing GDP can produce perverse outcomes (Costanza et al. 2014 ), appraising environmental performance through fl ow
measures alone is insuffi cient. For example, the metric of domestic material consumption (DMC) is used widely as a macroeconomic indicator of material requirements. Developing countries will always have a relatively high DMC until they
attain suffi cient infrastructure and capital stock to satisfy the physical demands of
their socio-economic aspirations. Evidence for this comes from growth in DMC of
developing nations in the Asia-Pacifi c region (UNEP and CSIRO 2013 ); for example, the DMC per capita of China has increased by 640 % over the last 40 years.
Most developed countries have achieved relative material decoupling (lower
DMC/ GDP ) over the last 30 years (Giljum et al. 2014 ). Müller et al. ( 2006 ) and
Wiedmann et al. ( 2013 ) have both suggested that industrialised nations have lower
DMC because they have already established their major infrastructure and their
population has grown more slowly than developing countries or has even saturated.
However, the interpretation may not be so simple. Matthews et al. ( 2000 ) calculated
NAS as the residual between input and output fl ows for a sample of developed
nations with established infrastructure and concluded that the NAS is still 8–12
tons/capita per year. The authors attributed this to a combination of factors including lower occupancy, urban expansion and affl uence.
In this chapter, we have used concepts from industrial ecology to frame problems
of the long-term future in terms of both stocks and fl ows and show how solutions are
substantially infl uenced by the creation of physical wealth in stocks and how stocks
can mitigate (or exacerbate) impacts and deliver services to society. The socioeconomic metabolism framework is intended to represent the interaction of stocks
across sectors and enable a more complete integrated assessment of policy options.
As in many areas of industrial ecology, data availability is a hurdle, but the socioT.M. Baynes and D.B. Müller
values of capital stocks that has not been fully translated into the environmental
extensions of national accounts. There is a substantial literature on the valuation of
natural and anthropogenic capital, but there is a strong tendency to use a common
denominator of monetary value or utility. Important physical information is then
lost. For example, there is a world of difference between having a small amount of
high quality, recently built road, and a much larger quantity of ageing, highly depreciated road that will soon be due for repair or replacement; the way capital value is
determined means these two situations could be equivalent in net worth but they are
very different in the services they provide and in their long-term material and energy
requirements.
Concentrating on the fl ow measure of GDP is rightly criticised as a false measure
of human well-being, which might be better defi ned by the accumulation of capacity to provide employment, food, education, safety and security, an approach
explored in Chap. 8 . That capacity corresponds more with the quantity and quality
of infrastructure, productive and non-productive capital stocks. Stocks are not
merely the accounting residuals of the net difference in bulk material fl ows. Through
the services they provide, stocks are indicators of physical wealth, and our ability
(through fl ows) to maintain and sustain that wealth is equally an important dimension of reporting and modelling the physical aspect of human well-being.
Just as seeking greater wealth by increasing GDP can produce perverse outcomes (Costanza et al. 2014 ), appraising environmental performance through fl ow
measures alone is insuffi cient. For example, the metric of domestic material consumption (DMC) is used widely as a macroeconomic indicator of material requirements. Developing countries will always have a relatively high DMC until they
attain suffi cient infrastructure and capital stock to satisfy the physical demands of
their socio-economic aspirations. Evidence for this comes from growth in DMC of
developing nations in the Asia-Pacifi c region (UNEP and CSIRO 2013 ); for example, the DMC per capita of China has increased by 640 % over the last 40 years.
Most developed countries have achieved relative material decoupling (lower
DMC/ GDP ) over the last 30 years (Giljum et al. 2014 ). Müller et al. ( 2006 ) and
Wiedmann et al. ( 2013 ) have both suggested that industrialised nations have lower
DMC because they have already established their major infrastructure and their
population has grown more slowly than developing countries or has even saturated.
However, the interpretation may not be so simple. Matthews et al. ( 2000 ) calculated
NAS as the residual between input and output fl ows for a sample of developed
nations with established infrastructure and concluded that the NAS is still 8–12
tons/capita per year. The authors attributed this to a combination of factors including lower occupancy, urban expansion and affl uence.
In this chapter, we have used concepts from industrial ecology to frame problems
of the long-term future in terms of both stocks and fl ows and show how solutions are
substantially infl uenced by the creation of physical wealth in stocks and how stocks
can mitigate (or exacerbate) impacts and deliver services to society. The socioeconomic metabolism framework is intended to represent the interaction of stocks
across sectors and enable a more complete integrated assessment of policy options.
As in many areas of industrial ecology, data availability is a hurdle, but the socioT.M. Baynes and D.B. Müller