Economics Of Sustainable Development

Question 1

Sustainable Economic Growth

Answer 1

Increase in GDP that can be sustained into the future

Question 2

Sustainable Economic Development

Answer 2

• An increase in utility or well-being that can be sustained in the future
• does not decrease the capacity to provide at least the same level of utility or well-being in the future
• inter-generational equity

Question 3

What is Weak Sustainability

Answer 3

• Optimistic view to natural resource use
• Built on the assumption of substitutability of natural capital
• As income rises, the state of the environment also improves

Question 4

What is the Strong Sustainability view?

Answer 4

• Pessimistic and cautious about deprecating natural stocks - Natural capital
• non-substitutability through other forms of capital
• wish to stay at the natural capacity of the environment
• extract enough such that there are plenty left for future generations to use for their economic development

Question 5

How can you measure weak sustainability?

Answer 5

Genuine savings:

GS = investment into total capital - Depreciation of total capital