Saturday, January 22, 2005
[495] Of development and the environment
There seems to be a strong relationship between the level of economic development and environmental protection. I've always suspected this and a post in a forum reminded me of it. The poster presented the idea and asked why that seems to be so. I offered her a short answer. A few hours later, I sat down somewhere and gave it a further consideration quietly.

I think the relationship between the two aspects is actually the opportunity cost - the cost of investing in one variable is the forgone benefit of other variable. In our context, if a country is poor and lack capital, the society there will be more concerned with wealth buildup instead of safeguarding the Earth. The cost of protecting the environment in term of development is too great; that country cannot afford to protect the environment at the expense of development.

The enforcement of environmental laws needs resource for implementation. If a country has no sufficient resource or wealth, then environmental laws enforcement greatly forgoes the benefit of accumulating capital. That is, the resource will be better put in use in improving the economy. Therefore, better attention will be given to economic issues instead of environmental ones, given that a country or a person is poor. Now, if that is so, the only way to instill the care for the environment is to reduce the forgone benefit of economic growth while engaging in environmental protection.

The reduction of forgone benefit cost is possible if wealth increases. This grows from the idea of diminishing returns - the more one has of a good, the less one wants more of it. In other words, another additional some sort of unit of wealth will have less benefit to the society of great wealth than to some improvised populace. Hence, as wealth increases, the cost of forgone benefit decreases.

Furthermore, environmental protection will only come when the cost of forgoing economic pursue is lower (or possibly lower or equal to) than the cost of forgoing environmental protection. Hence, if one cares for the environment, accumulation of wealth should be paramount because the accumulation of wealth reduces the cost of forgoing development.

One possible supporting proof is the possible correlation between wealth of countries with the strength of environmental laws and its enforcement; developed nations do seem to have stricter environmental requirements relative to poor countries. It would be interesting to see if there is an actual data set on this.

So, let's all get rich in the name of the environment!

I'm not quite certain on this however. Some variable must have been left unconsidered and thus, I dare not assert this model as perfect.

p/s - there seems to be a character encoding problem with this new template.
pp/s - godddamn! This entry took some serious proofread. When I first read the completed version, I was lost in my own words!
ppp/s - the Malay version of Windows XP will be shipped soon! But, given that the OS uses confusing Malay terms and it's sort of XP lite, I'll stick with the English version, thank you. (Via)
p4/s - this is, um, retarded.
p5/s - updated the about section.
23:30 EST | (0) Comments

                   
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