Cp 10 The Environment and Development - Cp10The...

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Cp 10 The Environment and Development
The interaction b/w poverty and environmental degradation can lead to a self-perpetuating process of resource misallocation and exhaustion and hence a “poverty trap.”This can have large implications of self-sufficiency, income distributions, and future growthImposes high costs on countries through health-related expenditures and reduced productivity of such scarce resourcesCultivation of marginal land is largely the domain of lower-income groups whereby the losses are suffered by those who can least afford themEconomics and the Environment
Environmental issues affect, and are affected by, economic developmentPoverty and ignorance may lead to non-sustainable use of environmental resourcesClean water, arable land, deforestation, and over-harvested fish populationsPast exclusion of environmental costs from GNI is a major factor as to why environmental considerations have been historically absent from development economicsEconomics and the Environment
Eight basic issues defining the environment of development:The concept of “sustainable development” and environmental accountingPopulation, resources, and the environmentPoverty and the environmentEconomic growth and the environmentRural development and the environmentUrbanization and the environmentThe global economy and the environmentThe nature and pace of greenhouse gas-induced climate changeEconomics and the Environment
The issues surrounding sustainable development are threefold:EconomicEnvironmentalEquity (Social)Classically defined, development is sustainable: “if and only if the stock of ‘overall capital assets’ remains constant or increases over time.”Sustainability refers to: “meeting the needs of the present generation without compromising the needs of future generations.”Sustainability
‘Overall capital assets’ means:Physical capital – machines, tools, equipment, roads, bridges, factoriesHuman capital – knowledge, experience, skills, health, educationEnvironmental capital – forests, soil quality (arable land), rangeland, fisheries, air, fresh waterSustainable development requires that these ‘overall capital assets’ not be decreasingSustainable Development and Environmental Accounting
Therefore, sustainable net national income is defined as the amount a nation can consume without diminishing the said capital stock:NNI* = GNI – Dm – Dn;NNI* = sustainable net national incomeDm = depreciation of capital assetsDn

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