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Implications of Ecological Economics to Regional Economics

KÖHN, J., and J. GOWDY, 1997 (eds.).
Rostocker Beiträge zur Regional- und Strukturpolitik, 10
(ISSN 0947-6016)
Introduction

Sustainable development has been a topic of debate since the publication of the Brundtland Report Commission Report, Our Common Future, in 1987. During the last decade, dozens of books and hundreds of academic articles have given a variety of meanings to the term sustainability. Definitions of sustainability range from sustainable economic growth to sustainable evolutionary potential. Costanza and Patten (Ecological Economics, December 1995) offer the following broad definition: "A sustainable system is one that survives and persists". Three complicating questions arise from this simple definition. What system or subsystems or characteristics of systems persist? For how long? When do we assess whether the system has persisted? Keeping these questions in mind will help avoid much of the confusion that has plagued the sustainability discussion.
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    1. What system do we wish to sustain? The ecosystem? The economy (global, continental, fluvial, national, regional, local world, national, regional or subregional)? Human so.ciety? Each choice implies very different sustainability policies.
    2. For how long do we want the system to persist? This is a critical question nd one that sharply divides economy, society, and environment. Market economies are driven by decisions based on a very short timescale with the future heavily discounted. Human societies operate within a longer frame of reference and invariably have elaborate customs and regulations to reconcile individual and collective choices. Ecosystems operate on timescales that may be centuries or even millennia long.
    3. At what point do we assess the system? All living systems, including the uman economy, go through cycles of variation or even a wavw like development a cascade of equilibria which differs in all main properties (see Fischer 1996, The great wave). When we assess the sustainability of a such a system, we need to be clear about where we are on the cycle.
    4. Is sustainability the more a regulative idea for political action or should it be subject of scientific diput only? We think it is both, however, the role of science may be defined as being a mean to support sustainable policies.
    5. May one subdivide the sustainability idea to environmental, social and economic sustainability or is it a comprehensive concept including all these compounds? We try to support the indivisiblibily of sustainability including environmental and social ethics.
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During the ten years since the Brundtland report we have learned a great eal about the complexity of the concept "sustainability". One thing that has become clear is that we need to combine theory and practice to develop workable plans for sustainability.

These plans must begin at the locallevel. At this critical juncture in human history we need some successes in our attempts to reconcile economic and environmental sustainability. The essays in this volume attempt to do just that by applying the basic concepts of ecological economics to regional economics. The contradictory meanings of sustainability have created great confusion among advocates of environmental protection and those concerned with sustainable regional development. The papers in this volume bridge the gap between the theory and practice of sustainability. Sustainable development is brought down to earth through applications of the concept to specific regional policies.
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The paper by Jörg Köhn examines the history of German environmental policy ocusing on specific regional examples including sewage treatment in Berlin, water management in the Ruhr area, the establishment of national parks, and the exploitation of Baltic herring. The common theme in all these examples is the complexity of ecosystems and the unintended consequences of environmental policies based on insufficient knowledge of local resources.

Fred Luks examines the intellectual roots of Herman Daly's "Steady State Economics" and suggests several ways in which Daly's many theoretical contributions may be operationalized. Luks suggests that the concept of optimal scale is more than a metaphor. It can be operationalized as in the MIPS (material input per service content) pioneered by Schmidt-Bleek and others at the Wuppertallnstitute. Luks calls for a more dynamic concept of the steady state that takes into account the complex interactions between economy, society and environment.

Faye Duchin calls for a second stage of ecological economics which goes eyond broad metaphots to focus on concrete strategies for sustainable development. Duchin argues that an appropriate framework for such a program is structural economics, a theoretical and methodological extension of input-output analysis. Duchin argues for a clean break with neoclassical economics including the distinction between micro- and macroeconomics. Today's social and environmental crises call for radical solutions. Structural economics offers a way to go beyond standard marginal analysis and evaluate scenarios about lifestyles far from the existing state of being.
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John Gowdy argues that the current level and character of human activity is ot only unsustainable. it is unique in human history. Although many past civilizations degraded their environment to the point that their resource bases could no longer support them. past collapses were local. Today the human impact is global and is characterized bya single type of economic organization. Gowdy calls for a reconstruction of institutions for collective decision-making based on a recognition of the hierarchical relationship between markets. society and the environment. He argues that the path toward sustainability begins with regional sustainable development projects based on the explicit recognition of the conflict between markets and ecosystems.

Sabine O.Hara and Raimund Schwendner purpose the method of ethical discourse as a means of bringing social and ecological intelligence to the decision-making process. Great advances have been made in understanding the ecological basis of human existence and the importance of humans institutions in maintaining social and environmental stability. Discursive ethics offers a way to move policy decisions beyond simple and misleading cost-benefit calculations.

Mario Giampietro discusses the phenomenon that increasing efficiency of natural resource input use in production tends to increase the total use of natural resources (the so-calIed Jevons paradox). Giampietro uses a world resource data base to examine two kinds of efficiency, ( 1) input required per unit of output. and (2) speed of throughput. Giampietro also calls for a decision-making framework based on the recognition that socio-economic systems operate on several hierarchicallevels. A technology that is sustainable at one level may be unsustainable at another.

Danilo Pelletiere and Jörg Köhn use the work of von Thünen - arguably the father of regional economics - to construct a framework to analyze regional sustainability. One of Von Thünen's great contributions was to recognize the importance of regional non-correspondence". that is, ecological. political. economic. and administrative boundaries will never be the same. Thünen's isolated state is a method which uses information gathered at the local level to understand influences originating from national or even global sources.

Friedrich Hinterberger also insists that sustainability must be made concrete and operationable. Hinterberger distinguishes between positive and normative meanings of sustainability. It is important to distinguish between, for example, descriptions of possible sustainable systems and recommendations as to which of these sustainable systems is most desirable. Recognizing the three corners of sustainability, economy, environment, and society, Hinterberger calls for a dematerialization of the economy. Following the advice of Boulding and Daly he calls for a dramatic reduction in the material and energy throughput of the economy.
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Maria Welfens examines the problem of sustainability in the new market economies of central and eastern Europe. These countries face enormous environmental and social problems resulting from decades long policies of maximizing economic growth regardless of the environmental costs. As Welfens points out, these problems also represent an opportunity for the countries of central and eastern Europe to avoid mistakes made in the West. For these countries dematerialization makes economic sense as weIl as environmental sense. Recognizing the difference between resource efficiency per unit of output and total resource use, Welfens makes specific policy recommendations which will smooth the transition to economic, social and environmental sustainability.

Liane Möller discusses the environmental policy implications of administrative decentralization in Poland. Under new principles of seif-administration, many environmental and regional development initiatives are underway. Programs at the macroregionallevel include plans for the "Green Lung" area of Poland, protection of the Baltic sea, and management of rivers for economic use and water quality. International initiatives include plans for the integration of Polish protected areas into the "Green Lungs" of Europe area, and a program for the "Black triangle" area of heavy sulfur pollution. These and other initiatives are discussed in terms of specific policy instruments for regional development and environmental protection.

The editors wish to thank all authors for their contribution to this volume and hope that the ideas provided in this volume may support decision making processes toward sustainable development.

Troy, Rostock, April 1997

John Gowdy, Jörg Köhn
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