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Will getting rich save the planet?

This articles introduces a 'natural capital' approach to the climate and biodiversity crisis.
photo of yellow lesser celandine against dark green foliage
© University of Reading

What is the relationship between economic growth and the planetary environmental crisis? Some influential thinkers have argued that countries need to build and sustain wealth to have sufficient capacity to protect the environment.

In a newspaper commentary entitled ‘Why wealth and wildlife go hand in hand’, the science writer, Matt Ridley argued that wildlife is recovering in rich countries1. He suggested that conservation organisations like the World Wildlife Fund and the Zoological Society of London get it ‘exactly backwards’ when they blame the consumer society and intensification of agriculture for the plight of wildlife.

It’s easy to see the allure of the mantra, ‘get rich to save the planet’. It’s awkward for policy makers to address how seeking prosperity in the short term often destroys the environment on which our longer term prosperity depends. If wealth generation is purely good for the environment then that headache goes away.

The trouble is, it’s just not true. Wealthy countries are the most nature-depleted in the world due to a long history of intensive agriculture and industrialisation2. Getting rich has generally gone hand-in-hand with rapid destruction of the environment. The assertion put forward by Ridley, that many species are doing well in rich countries, turns out to be based on cherry-picked examples of how certain mammal species (such as deer, bear and wolves) are doing well in Europe, whereas lions and elephants in Africa are declining.

However, considering the bigger picture, synthesis reports across Europe, such as the IUCN European Redlist assessment, find that more than a quarter (27%) of European mammals are declining in population, whilst 32% are stable, and only 8% are increasing3. So, using selected examples is misleading. Overall, wildlife trends in Europe and other higher income regions are not in a good state, a fact confirmed by more recent comprehensive analysis which includes other important species groups, such insects, spiders and molluscs4. Similar declines in wild species are occurring around the world, particularly in countries where economic growth and rates of conversion of natural habitat into agricultural land are greatest5.

The argument that nature conservation goes hand in hand with economic growth is dangerous, because evidence shows the exact opposite to be the case: as a country’s economy grows, such as through agricultural intensification and expansion of industry, it follows that biodiversity loss, carbon emissions, air and water pollution all tend to increase6. Therefore, when metrics of economic growth like GDP (gross domestic product, a measure commonly used by countries to assess progress) accelerate, then the faster we degrade the environment.

As a United Nations Environment Programme report7 explains:

Gross Domestic Product fails to fully account for the benefits people get from nature and the costs of its degradation. The standard measure of economic performance, gross domestic product (GDP), only measures the value of market transactions and therefore excludes much of the value of nature’s contribution to human well-being. GDP excludes the value of ecosystem functions that regulate environmental conditions and the value of non-material benefits related to spiritual or cultural values. It also excludes measures of negative externalities associated with the depletion and destruction of nature. GDP measures current income but does not show whether that income is sustainable. Supporting current income through depletion of natural capital is not sustainable.

So, is there a way to increase wealth which doesn’t have negative environmental impacts? This all depends on the degree to which economic growth and environmental damage can be ‘uncoupled’ so that metrics like GDP don’t increase at the expense of the environment. There is some evidence for ‘relative uncoupling’, for example through designing industrial processes that produce less pollution. In the UK, energy efficiency gains in manufacturing and transport sectors means that CO2 emissions per unit growth of GPD (£ per capita) are substantially lower in 2019 than they were in 19808. The UK’s economic growth is less environmentally damaging than it once was but further economic growth that’s dependent on consumption of natural resources will still lead to environmental damage. If you’re interested in this topic, there are resources, including the European Commission’s ‘Beyond GDP initiative’, in the See also section below.

The vision of a ‘circular economy’ involves absolute uncoupling of economic growth from environmental degradation. The idea is, the economy runs solely on renewable energy and everything we use is recycled from something else. While this is the right direction to move towards, it’s important to critically assess the degree to which achieving this in a timely way is a form of wishful thinking. If it’s not sufficient to avert environmental crisis, then other economic strategies are likely to be needed, such as putting the brakes on harmful economic growth and developing alternative metrics of societal progress which integrate environmental quality as well as aspects of human wellbeing9.

References

  1. Why wealth and wildlife go hand in hand, Ridley, M. The Times, 31st Oct 2016
  2. UK has ‘led the world’ in destroying the natural environment Natural History Museum (2020)
  3. European Red List IUCN Redlist (2007). (More recent assessments of European Biodiversity (the State and Outlook of European Environment 2020 and the UK State of Nature 2019) paint a similarly bleak picture for wildlife with more species declining than increasing. Note this report also states that trend information is not available for 33% of mammal species, so the percentage of species in decline may actually be considerably higher.)
  4. UK State of Nature Report. 2019
  5. Global Assessment Report on Biodiversity and Ecosystem Services Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES). 2019
  6. The environmental Kuznets curve after 25 years, Stern, D.I. Journal of Bioeconomics, 19, 7-28. 2017.
  7. Making Peace with Nature: A scientific blueprint to tackle the climate, biodiversity and pollution emergencies. United Nations Environment Programme 2021.
  8. The decoupling of economic growth from carbon emissions: UK evidence Office for National Statistics. 2021
  9. When the Unspeakable Is No Longer Taboo: Growth Without Economic Growth Issues in Science and Technology, 37. Kovacic, Z., et al. 2021.
© University of Reading
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