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Measuring Environmental Sustainability In Chapter 14 we argue that sustainable development is a dynamic process that depends on the incentives to develop the technologies that enable us to increase human welfare without depleting our fixed resources. The rate of sustainable development cannot be determined ex-ante; it depends on how society deals with the clash between the desire for more production and our technological capabilities. An interesting attempt to measure a country's ability to grow without reducing its ecological wealth has been offered by the World Economic Forum. Called the Environmental Sustainability Index (ESI), this index measures a country's "overall progress toward environmental sustainability." The ESI is based on a great variety of information falling into five general categories:
The ESI thus tries to measure the environmental situation, whether it is deteriorating, how critical is the situation, and how prepared countries are to deal with the environmental situation. |
Clearly, the index addresses some of the concerns of economists,
namely that incentives for
technological progress must be taken into consideration in establishing the sustainable rate of
economic development. The ESI is closely correlated with per capita income. The rich nations are much closer to a sustainable environment than most developing economies. The highest-rates country is Finalnd, followed closely by Norway, Canada, Sweden, and Switzerland. At the bottom of the list is Haiti, an impoverished country that is completely deforested, provides very few of its citizens with drinkable water, has no pollution controls, and has no institutional mechanisms to deal with environmental issues. The ESI seems to misrepresent some countries' sustainability. For example, the index rates Russia among the top 15 percent and Singapore below the median in terms of sustainability. In reading the details of the index, it is clear that Russia is favored by the unreliability of its data (which the World Economic Forum takes at face value). Singapore is punished for pushing its economy close to its limits, which the index interprets as a high degree of "vulnerability." Having pointed out some potential problems with the ESI, it is nevertheless an interesting attempt at quantifying sustainability and improves on some of the simplistic attempts of the past. The ESI is available at: www.ciesin.columbia.edu/indicators/ESI See also: www.wef.org |