Transcript Integração de variáveis ambientais em modelos de crescimento

Doctoral Program and Advanced Degree in Sustainable Energy Systems
Doctoral Program in Mechanical Engineering
Doctoral Program in Environmental Engineering
Ecological Economics
Lecture 08
Rui Mota
Researcher
Tiago Domingos
Assistant Professor
Environment and Energy Section
Department of Mechanical Engineering
What is Sustainable Development?
• Brundtland report (1987) – “Development that meets the needs of the present
without compromising the ability of future generations to meet their own need.”
– Intra- and inter-generational equity
– Anthropocentric
• Sustainability of what?
–
–
–
–
non-declining aggregate output or consumption,
non-declining utility,
non-declining aggregate resources (productive base),
non-increasing pollution, …
• Weak vs. Strong Sustainability
• We choose non-declining utility as the criterion for sustainable development
– some call this Weak Sustainability, but we don’t agree 
– this still misses the intra-generational component
• What is green net national income (GNNI) and what does it measure?
• What is genuine saving and what does it measure?
Alternative measures of well-being
• World Bank’s Adjusted Net Savings (Genuine Savings)
• ANS measure the true rate of savings in an economy after taking into account investment in
human capital, depletion of natural resources and damage caused by pollution. ANS time
series can be downloaded for 140 countries. (http://go.worldbank.org/VLJHBLZP71)
• Beyond GDP, European Comission (http://www.beyond-gdp.eu/)
• Which indices are most appropriate to measure progress, and how these can best be
integrated into the decision-making process and taken up by public debate.
• “We cannot face the challenges of the future with the tools of the past. It's time to go
beyond GDP.” Durão Barroso
• Extending European National Accounts to environmental and social issues
• OECD work on alternative measures of welfare (www.oecd.org/dataoecd/13/38/36165332.pdf)
• Extending GDP to include leisure time and inequality.
• Stiglitz Commission (http://www.stiglitz-sen-fitoussi.fr)
• Identify the limits of GDP as an indicator of economic performance and social progress.
• SEEA 2003, United Nations (http://unstats.un.org/unsd/envaccounting/seea.asp)
• Satellite system of the System of National Accounts that brings together economic and
environmental information in a common framework to measure the contribution of the
environment to the economy and vice-versa.
World Bank’s Genuine Savings
World Bank’s Genuine Savings
World Bank’s Genuine Savings
World Bank’s Genuine Savings
World Bank’s Genuine Savings
World Bank’s Genuine Savings
• Resource Curse: Countries dependent on natural resources tend to depict
unsustainable development (negative GS).
World Bank’s Wealth Estimates
Multisector Optimal Growth
• m-dimensional consumption bundle, including everything that influences
well-being.
– Includes all non-market commodities, e.g, produced at home, environmental
services, …
• n-dimensional capital vector:
– Includes man-made capital, natural resources, human capital
(education and knowledge) and foreign capital. Time is included as a
capital, to depict technological progress in production.
• Attainable production possibilities C(t ),I(t )  S (K(t ), t )
• The model

max  U (C (t ))e  t dt s.t.
c
0
dK
I
dt
C(t ),I(t )  S (K(t ), t )
Criteria for Sustainability, Pezzey (2004) EDE
• An economy is sustainable at time t if and only if the representative
agent’s current utility does not exceed the maximum level of utility which
can be sustained forever from t onwards.
• One-sided sustainability test:
QI  0 or
dY
 0  un-sustainable development.
dt
• Multisector results in real terms.
– Real Net Income, Y  P  C  Q  I
– Genuine Saving, Q  I
Consumption
– dY  RQ  I  R dW
dt
Variation in
Real Net Income
 dt
Variation in
Welfare
Investment
Welfare Relationships
• Both Genuine Savings and Green NNI are related to future consumption.
• These relationships can be used to empirically check the theory.
• If genuine saving is negative (or green NNI deacreases) then current
consumption will decrease in the future.
Small Open Economy
• Include
– stocks of commercial forests,
– welfare costs of air emissions,
• The capital stocks are K : ( K , K f ,S) :
– Domestic man-made capital,
dK
 I  CFC
dt
– Net foreign capital held privately or by the government,
dK f
 rK f  X  M  QR  (R X  R M )
dt
– Stock of commercial natural resources
dS
 G(S)  R d  R X
dt
• Production
I  F ( K , R d  R M )  M  X  C  a  f (R d  R X ,S)
r – interest rate
Small Open Economy
• Households’ utility function U (C) : U (C ,E) depends on material
consumption rate and (negatively) on the flow of emissions
• The vector of emissions E( F ( ),a) depends on production and abatement
expenditure.
• Maximize welfare subject to the above relations and having as controls
consumption, C (t ) , all forms of extraction, Rd (t ), R X (t ), RM (t ), abatement
expenditure a(t ) and trade balance M (t )  X (t ).
• Conventional (SNA) NNI:
• Green Net National Income:
NNI : C  K  K f

Y  NNI  (Q  f R )  S  e E Q t
R


• Genuine Saving (Adjusted Net Saving): Q K  Q  NNI  C  (Q  fR )  S Qt
t
R
Small Open Economy – Table of symbols
C (t )
K
Consumption rate at time t
Man-made capital,
Kf
U ()
Utility
E()
Rate of emissions of air pollutants
e
F ()
a
Ri , i  d , X , M
MX
Marginal cost of abatement = Marginal damage cost
Production function
Abatement expenditure
Extraction of natural resources for domestic use, exports and
from imports.
Imports - Exports
r
Constant nominal interest rate
S
Stock of resources
R
Constant real interest rate
QR
Resource price
f (R d  R X ,S)
fR
Net foreign capital
Cost of extraction of resource
Marginal cost of abatement