CURRENT PROBLEMS OF QUANTITATIVE DESCRIPTION OF THE ECONOMIC AND ENVIRONMENTAL FACTORS’ INTERACTION

Author
, Doctor of Sciences (Economics), Professor, Professor of Economics Department, Lviv, prospekt Svobody, 18

In heading

 Economic theory;

Signed print

 28.03.2024

Issues number

 2024 - 1 (56)

Page

 6-24

Type of articles

 Scientific article

Code UDK

 330.3:502.131

ISSN print

 2411-5584

Abstract

 Problem setting. The fundamental issue of human civilization development today concerns the proper balance between the growth of people’s well-being and the environment’s protection. The necessary precondition of the correct answer to this problem is the availability of relevant indicators that can successfully describe the economic and ecological processes and phenomena and their interactions.
Recent research and publications analysis. Current research focuses on the conditions of harmonious development within planetary boundaries, including some sustainability metrics as an additional component of the Human Development Index and forming a complete indicators toolbox for efficient descriptions of sustainable development goals and targets.
Paper objective. The article aims to consider some fundamental problems of quantitative description of economic and environmental factors interaction in modern economics.
Paper main body. Several recent advances determined the current research on balanced human development within a preserved environment. The planetary boundaries framework identified quantitative thresholds for eight among nine critical Earth-system processes,
seven of which are assessed to be transgressed as of now. This approach is complemented logically by K. Raworth’s concept of a safe and just space for humanity, adding a social dimension. Finally, the progress in calculating different footprint indicators contributed to the quantitative analysis of the ecological impacts of economic activities.
The Human Development Index has been widely used instead of GDP for decades as a more human-centered concept. Still, this indicator is heavily criticized because of the tight coupling between the high HDI position and income growth accompanied by more adverse ecological impacts. Under these circumstances, HDI promoted the development model that led the planet to inevitable catastrophe.
Therefore, much effort was put into numerous modifications of the Human Development Index, which try to consider the damages caused by humans to the environment. Within these approaches, the HDI is adjusted considering the volumes of carbon dioxide emissions and a relatively new class of indicators – “footprints,” which link specific types of anthropogenic pressure on the environment with the final сonsumption of goods and services. According to new ratings, countries with modest levels of income (resulting in acceptable ecological impacts) and relatively high social indicators became leaders, while advanced economies substantially dropped.
The global dimension of the problem considered is revealed in the need to provide a proper quantitative description of the sustainable development goals. Even though the goals mentioned were adopted for 2015–2030, forming a coherent system of relevant indicators that effectively reflects progress toward achieving 17 goals and 169 corresponding tasks will require unprecedented efforts.
Conclusions of the research. The aggravation of ecological problems in most regions prompted scientists to intensify the search for ways to harmonize human-environment relations. According to recent trends, the Human Development Index is adjusted considering the volumes of CO2 emissions and different “footprints,” which link specific types of anthropogenic pressure on the environment with the final consumption. The global dimension of the problem concerns the formation of a coherent system of indicators that would efficiently trace the progress toward achieving sustainable development goals.
Short abstract for an article
Abstract. The paper focuses on a quantitative description of the interaction of economic and ecological factors. Modern approaches to Human Development Index modification using CO2 emissions and material footprint data are considered. It is shown that the global dimension of this problem concerns the formation of a coherent system of indicators that would efficiently trace the progress toward achieving sustainable development goals.

Keywords

 economic growth, environment, planetary boundaries, Human Development Index, CO2 emissions, material footprint, SDG indicators.

Reviewer

External reviewer

Article in PDF

 6-24

Bibliography

 1. Eisner, R. (1988). Extended accounts for national income and product. Journal of Economic Literature, 26(4), 1611–1684.
2. National Research Council (1999). Nature’s numbers: Expanding the national economic accounts to include the environment. The National Academies Press. https://doi.org/10.17226/6374
3. United Nations Development Programme. (1990). Human development report 1990: Concept and measurement of human development. https://hdr.undp.org/system/files/documents/hdr1990encompletenostats.pdf
4. Rockström, J., Steffen, W., Noone, K., Persson, Å., Chapin III, F. S., Lambin, E. F., Lenton, T. M., Scheffer, M., Folke, C., Schellnhuber, H. J., Nykvist, B., de Wit, C. A., Hughes, T., van der Leeuw, S., Rodhe, H., Sörlin, S., Snyder, P. K., Costanza, R., Svedin, U. … Foley., J. A. (2009). A safe operating space for humanity. Nature, 461(24), 472–475. https://doi.org/10.1038/461472a
5. Raworth, K. (2017). Doughnut economics: Seven ways to think like a 21st-century economist. Chelsea Green Publishing.
6. Van den Bergh, J. C. J. M., & Kallis, G. (2012). Growth, a-growth, or degrowth to stay within planetary boundaries? Journal of Economic Issues, 46(4), 909–920. https://doi.org/10.2753/JEI0021-3624460404
7. O’Neill, D. W., Fanning, A. L., Lamb, W. F., & Steinberger, J. K. (2018). A good life for all within planetary boundaries. Nature Sustainability, 1, 88–95. https://doi.org/10.1038/s41893-018-0021-4
8. Cibulka, S., & Giljum, S. (2020). Towards a comprehensive framework of the relationships between resource footprints, quality of life, and economic development. Sustainability, 12, Article 4734. https://doi.org/10.3390/su12114734
9. Nathaniel, S. P. (2021). Ecological footprint and human wellbeing nexus: Accounting for broad-based financial development, globalization, and natural resources in the next-11 countries. Future Business Journal, 7(1), Article 24. https://doi.org/10.1186/s43093-021-00071-y
10. Rockstrom, J., Gupta, J., Qin, D., Lade, S. J., Abrams, J. F., Andersen, L. S., Armstrong McKay, D. I., Bai, X., Bala, G., Bunn, S. E., Ciobanu, D., DeClerck, F., Ebi, K., Gifford, L., Gordon, C., Hasan, S., Kanie, N., Lenton, T. M., Loriani, S., … Zhang, X. (2023). Safe and just Earth system boundaries. Nature, 619, 102–111. https://doi.org/10.1038/s41586-023-06083-8
11. Pineda, J. (2012, June 19). Sustainability and human development: A proposal for a sustainability adjusted HDI (SHDI). MPRA. https://mpra.ub.uni-muenchen.de/42636/
12. Biggeri, M., & Mauro, V. (2018). Towards a more ‘sustainable’ Human Development Index: Integrating the environment and freedom. Ecological Indicators, 91, 220–231. https://doi.org/10.1016/j.ecolind.2018.03.045
13. Hickel, J. (2020). The Sustainable Development Index: Measuring the ecological efficiency of human development in the Anthropocene. Ecological Economics, 167, Article 106331. https://doi.org/10.1016/j.ecolecon.2019.05.011
14. Hak, T., Janouskova, S., & Moldan, B. (2016). Sustainable development goals: A need for relevant indicators. Ecological Indicators, 60, 565–573. https://doi.org/10.1016/j.ecolind.2015.08.003
15. MacFeely, S. (2020). Measuring the sustainable development goal indicators: An unprecedented statistical challenge. Journal of Official Statistics, 36(2), 361–378. https://doi.org/10.2478/JOS-2020-0019
16. Kubiszewski, I., Mulder, K., Jarvis, D., & Costanza, R. (2022). Toward better measurement of sustainable development and wellbeing: A small number of SDG indicators reliably predict life satisfaction. Sustainable Development, 30(1), 139–148. https://doi.org/10.1002/sd.2234
17. Kim, R. E. (2023). Augment the SDG indicator framework. Environmental Science and Policy, 142, 62–67. https://doi.org/10.1016/j.envsci.2023.02.004
18. Kennedy, R. F. (1968). Remarks at the University of Kansas, March 18, 1968. https://www.jfklibrary.org/learn/about-jfk/the-kennedy-family/robert-f-kennedy/robert-fkennedy-speeches/remarks-at-the-university-of-kansas-march-18-1968
19. Kornbluth J. Robert Kennedy on the GNP: We don’t measure what really matters. https://www.huffpost.com/entry/robert-kennedy-on-the-gnp_b_1539138
20. McConnell, C. R., Brue, S. L., & Flynn, S. M. (2009). Economics. Principles, problems, and policies (18th ed.). McGrow-Hill / Irwin.
21. Mankiw, N. G. (2012). Principles of economics (6th ed.). South-Western.
22. The World Bank. (n. d.). DataBank. Adjusted national savings. https://databank.worldbank.org/source/adjusted-net-savings
23. Stiglitz, J. E. (2009, September 7). GDP fetishism. Project Syndicate. https://www.project-syndicate.org/commentary/gdp-fetishism
24. United Nations Development Programme. (2010). Human Development Report 2010: The Real Wealth of Nations: Pathways to Human Development. Palgrave Macmillan. https://hdr.undp.org/content/human-development-report-2010
25. United Nations. (n. d.). The 17 goals. https://sdgs.un.org/goals

Code DOI

 https://doi.org/10.31359/2411-5584-2024-56-1-6

28.03.2024