On 24 June the GGKP hosted a policy session on "Linking Research and Policymaking for Inclusive Green Growth" as part of the 22nd Annual Conference of the European Association of Environmental and Resource Economists (EAERE). In this Q&A, Professor Edward Barbier, who spoke at the GGKP's policy session at EAERE, shares his thoughts on how research can inform and shape policy-making to deliver inclusive green growth on the ground.
Your recent book, “Nature and Wealth: Overcoming Environmental Scarcity and Inequality” discusses a structural imbalance between environmental degradation and wealth inequality. Do you consider inclusive green growth a solution to this issue? How can it be made a reality?
I consider inclusive green growth to be a key strategy for overcoming the structural imbalance caused by excessive environmental degradation and wealth inequality. In my book, Nature and Wealth, I do not refer to this approach as inclusive green growth per se, but refer to it as the "Balanced Wealth Strategy", as its aim is to overcome the current imbalance in wealth creation by the world economy. The four key elements of the strategy are:
- Ending the persistent under-pricing of natural capital that leads to its over-use in all economies.
- Ending insufficient human capital accumulation that contributes to increasing wealth inequality.
- Adopting policies targeted at inefficient natural resource use and poverty in developing economies.
- Creating markets to address key global environmental impacts, such as climate change, loss of key ecosystems, and management of transboundary water resources.
The Balanced Wealth Strategy is clearly not costless, and will require substantial commitments by all economies. But unless such a strategy is pursued, offering the opportunity to transition to a more inclusive economy through green innovation and growth, the current global threats of environmental scarcity and inequality will continue to worsen.
What are the challenges faced by policymakers in developing and implementing inclusive green growth policies? What can the academic community do to support these efforts?
We face two possible visions of the future. We can persist with the current path of an exclusive but brown economy inherited from the second phase of the Industrial Revolution and the fossil fuel era. Or, the world economy can embark on a third phase of innovation, sustainable growth and economic prosperity. Making the transition to an inclusive green economy will not be easy, but the consequences for the majority of the world’s population of the current pattern of depleting nature to accumulate wealth could be bleak, if not catastrophic. Unfortunately, most policymakers see environmental degradation as a threat to the environment but not to economic prosperity. Or they see any possible threats as being more of a future challenge, rather than conditioned on choices that are being made today. The key role of the academic community is to show that these choices involve greater hidden costs today than are currently believed to be the case, and that the benefits of change are worthwhile for economies as well as the environment.
Could you provide an example of a successful policy aimed at promoting pro-poor, inclusive green growth? What lessons could be drawn from this example for policymakers? For researchers?
There are some excellent examples contained in the recent document, "Pro-poor inclusive green growth: experience and a new agenda" by the Global Green Growth Institute. Although successful policies are always important, one or two policies in isolation are not sufficient to overcome the overall structural imbalance of an economy that is chronically under-pricing natural capital and suffering from growing income and wealth disparity. Inclusive green growth is about an entire economy transitioning to a more sustainable and inequitable means of wealth creation. It takes more than one or two policy interventions, no matter how important, to make such a transition.