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					Sustainable Development


       INDICATORS
               SD: Indicators
The elaboration of a suitable system of indicators
  for sustainable development is one of the major
  challenges facing contemporary science. The very
  interdisciplinary nature of the issue, which is
  preconditioned by the intricate and highly
  dynamic system of inter-relations and inter-
  dependencies between the socioeconomic
  system and the natural environment, renders the
  solution to the problem of indicator elaboration
  exceedingly difficult.
                 SD: Indicators
• The individual indicators or systems of indicators that
  have been used thus far are the product of two
  relatively autonomous approaches.
• The first approach is based on the notion that
  sustainable development can be measured and
  assessed by using several subsystems of indicators
  reflecting sustainable development’s various aspects—
  environmental, social, economic, institutional, and so
  on. Such is the approach of the United Nations
  Commission on Sustainable Development (UNCSD) and
  of the much-respected International Institute for
  Sustainable Development (IISD) in Canada.
                   SD: Indicators
• The second approach puts its stakes on some “magical”
  indicator of a maximally-high degree of aggregation
  designed to reflect the entire range of indicators, covering
  the various aspects of sustainable development.
• It is natural to assume that the implementation of the
  second approach is considerably more difficult from a
  methodological point of view because it means
  characterizing numerous and varied direct links and
  feedbacks between indicators from various subsystems.
  Often, comparing these indicators along the lines of a
  certain common trait (monetary, physical, extent of change,
  and so on) contains too many conditionalities or is virtually
  impossible at this stage altogether.
                    SD: Indicators
• Are these two approaches mutually exclusive? Arriving at
  an integral and highly aggregated indicator is impossible
  without simulating an indicator system and corresponding
  subsystems grouped according to their congruity with the
  various characteristics of sustainable development. The
  issue we are focusing on is
• (1) whether eliciting a sufficiently reliable integral indicator
  that could encompass and reflect the entire specificity and
  variety underlying sustainable development is possible in
  principle and
• (2) whether the sum of relatively independent indicators,
  grouped in individual subsystems, could serve as a basis for
  the solving the methodological problem outlined above.
               UN: SD Indicators
• In 1997, at the 19th Special Session of the UN General
  Assembly, the UNCSD tabled a proposal for the elaboration
  of a system of 134 indicators of sustainable development
  grouped by the four relevant dimensions: social, economic,
  environmental, and institutional. The UN General Assembly
  endorsed the proposal and gave its approval for the system
  of indicators to be tested in twenty UN member countries.
  The experience from the tests and the results from the
  comparative analysis indicated the need for further
  improvement of the systematization and formulation of
  some of the indicators. This brought about a decrease from
  134 to 58 indicators with the purposes of avoiding double
  measurements and simplifying comparisons as much as
  possible.
       UN Indicators: ECONOMIC
• A. Economic Structure: GDP per capita, investment
  share in GDP, balance of trade in goods and services,
  debt-to-GNP ratio, total Official Development
  Assistance (ODA) received or given as a percentage of
  GDP
• B. Consumption and Production Patterns: intensity of
  material use, annual energy consumption per capita,
  share of renewable energy resource consumption,
  intensity of energy use, industrial and municipal solid
  waste generation, hazardous waste generation,
  radioactive waste generation, waste recycling and
  reuse, distance traveled per capita by mode of
  transport
     UN Indicators: Environmental
• A. Atmosphere: greenhouse gas emissions, ozone-depleting
  substance consumption, ambient concentration of air pollutants in
  urban areas
• B. Land: arable and permanent crop land area, fertilizer use,
  agricultural pesticide use, forest area as a percent of land area,
  wood harvesting intensity, land affected by desertification, area of
  urban formal and informal settlements
• C. Oceans, Seas, and Coasts: algae concentration in coastal waters,
  percentage of total population living in coastal areas, annual catch
  by major species
• D. Fresh Water: annual ground and surface water withdrawal as a
  percentage of total available water, BOD in water bodies,
  concentration of fecal coliform in freshwater
                UN Indicators: Social
• A. Equity: percentage of population living below poverty line, Gini Index of
  Income Inequality, unemployment rate, ratio of average female wage to
  average male wage
• B. Health: nutritional status of children, mortality rate of children less
  than five years old, life expectancy at birth, percentage of population with
  adequate sewage disposal facilities, population with access to safe
  drinking water, percent of population with access to primary healthcare
  facilities, immunization against infectious childhood diseases,
  contraceptive prevalence rate
• C. Education: percentage of children reaching grade five of primary
  education, adult secondary education achievement level, adult literacy
  rate
• D. Housing: floor area per person
• E. Security: number of recorded crimes per 100,000 population
• F. Population: population growth rate, population of urban formal and
  informal settlements
     UN Indicators: Institutional
• A.    Institutional   Framework:      national
  sustainable development strategy, ratified
  global agreement implementation
• B. Institutional Capacity: number of Internet
  subscribers per 1000 inhabitants, main
  telephone lines per 1000 inhabitants, research
  and development expenditure as a percentage
  of GDP, economic and human loss from
  natural
     UN Indicators: downsides
Naturally, countries with larger volumes of industrial
output, and that export their products to the
international market and thus meet certain demand,
will record higher levels of greenhouse gas emissions
if all other conditions of the compared countries
remain equal. In the first years of the transition to a
market economy, the Eastern European countries—
Russia included—marked a considerable decline in
their GDP and most notably in their industrial
output. This had a “positive” impact on the
environment because the manufacturing facilities
that used to pollute the environment had been
closed down or only partially used. An important
question to ask, however, is, Are lower greenhouse
gas emission indicators under such circumstances a
suitable sign for sustainable development?
         UN Indicators: downsides


• The “debt-to-GNP ratio” and “trade balance” indicators on their
  own, are also incapable of giving any ideas about sustainability or
  lack of sustainability. Countries with equal debt-to-GDP (or GNP)
  ratios are in different economic situations depending on the
  capacity and viability of their economies.
       UN Indicators: downsides
• The       “energy      consumption”        indicator
  (encompassing renewable and non-renewable
  energy consumption) is far too general, as well. In
  its essence, this indicator expresses an absolute
  value that is not related to the efficiency of the
  economy. In principle, it is possible to see a
  scenario whereby the declining energy
  consumption per capita of the population is a
  sign of lacking sustainability and a shrinking living
  standard, should this result from rising energy
  prices rather than from growing energy efficiency.
       Human Development Index
             HDI (UNDP)
• This index is based on three relatively
  independent components: (1) level of education,
  (2) per capita GDP, and (3) life expectancy.
• Each of the components has a sub-index of its
  own with an equal weight in the formation of the
  composite index. In other words, the sub-indices
  are equitable.
• In my opinion, both quantitatively and
  qualitatively, the GDP per capita index directly or
  indirectly reflects the other two indices or is
  rather strongly influenced by them.
                HDI Report 2010
              http://hdr.undp.org/en/statistics/
• Very High DI: Norway, Australia, New Zealand, United
  States, Ireland, Liechtenstein , Netherlands, Canada,
  Sweden, Germany, Japan, Korea (Republic of),
  Switzerland, France, Israel
• High HDI: Bahamas, Lithuania, Chile, Argentina ,Kuwait
Bulgaria No.58, Montenegro 49, Romania 50, Lybia 53
• Medium HDI: Fiji, Turkmenistan, Dominican Republic ,
  China, El Salvador
• Low HDI: Burkina Faso, Liberia, Chad, Guinea-Bissau,
  Mozambique , Burundi, Niger, Congo (Democratic
  Republic of the), Zimbabwe
• Bulgaria No.
Index of Sustainable Economic Welfare
                 ISEW
Developed by Serafy et al. (1989); Daly (1989) has expanded
  an index of a sufficiently high degree of aggregation:
      ISEW = Cadj + P + G + W – D – E – N

where Cadj is consumer spending adjusted for income
  inequality, P is non-defensive public expenditures, G is
  capital growth and net change in international position, W
  is non-monetarized contributions to welfare, D is the
  defensive private expenditures, E is the cost of
  environmental degradation, and N is the value of
  depreciation of the environmental capital base.
• ISEW is a useful step forward in the effort to find
  appropriate ways of aggregating indices from various
  subsystems by bringing them down to comparable
  monetary values.
The RioJo Dashboard System
• In 2001 the Consultative Group on Sustainable
  Development Indicators (CGSDI), with the International
  Institute for Sustainable Development (IISD),
  elaborated and presented before the UNCSD the
  Dashboard (Appendix 1), which is a system of indices
  covering all aspects of sustainable development that
  have been aggregated in a Sustainable Development
  Index (SDI). The elaboration and adoption of this
  approach by the UNCSD took place in connection with
  the preparation of the World Summit for Sustainable
  Development (WSSD) held in Johannesburg in 2002
  and the presentation of a report on the comparative
  analysis for the period 1990–2000.
     The RioJo Dashboard System
• The assessments and conclusions in the report have been made in
  compliance with the Millennium Development Goals (MDG).2
  Countries and regions implemented this Dashboard system of
  indicators to show the diverse nature of sustainable development,
  on the one hand, and to assess the policies pursued by individual
  countries or regional communities, on the other. This highly
  aggregated indicator of sustainable development is made of three
  relatively independent subindicator clusters, which reflect the
  situations of three spheres, which include
• Environment—quality of water, air, and soil and levels of toxic
  waste;
• Economy—employment, investments, productivity, income
  distribution, competitiveness, inflation, and efficiency of material
  and energy use;
• Society—crime rate, health, poverty, education, governance,
  military spending, and international cooperation.
      The RioJo Dashboard System
• As the suggested system of linked clusters indicates,
  each cluster is represented by an index, aggregating the
  indicators included in the respective sphere
  (environmental, economic, and social). The three cluster
  indices are aggregated again into an overall Sustainable
  Development Index (SDI). The indicators themselves are
  also represented in an index form. The environment-
  related index, then, is based on the Environmental
  Pressure Index (EPI) and the Ecological Footprint Index
  (EFI),3 and the economy-related index is based on the
  GDP and the Index of Economic Performance (IEP). The
  Consultative Group on Sustainable Development at the
  IISD thinks that the highly aggregated index they
  suggested should be able to reflect the stock, flow, and
  related interactions and management decisions.
     The RioJo Dashboard System

In essence, the third cluster concerning the social sphere is under-
   developed, although some possible indicators such as “happiness”
   and “fulfilment of the human potential,” have been put forward.

The question about how so many subjective assessments will be
  measured and will fit into the overall index has remained
  unanswered.
        Ecological Footprint of GDP
• The GDP carries abundant useful information about its
  ecological footprint if the output value is compared with the
  physical dimension (total and per unit) of the used input. The
  concept of ecological footprint was first introduced by Drs. M.
  Wackernagel and W. Reese in 1996. The energy and raw
  material consumption for production of a unit of GDP is one of
  the leading indicators for GDP’s spin-off effect, measured as an
  ecological footprint. Given that all other conditions are equal,
  the countries registering the lowest level of consumption per
  unit of GDP are among those with the highest industrial
  development and have the highest standard of living and high
  HDI.
• The Eastern European countries, for instance, register from five
  to eight times more electricity consumption per end-product
  unit than do the developed countries. Factor analysis shows
  that this is because of two main factors: lower technological
  level and under-developed market incentives.
                       Ecological Footprint
• In my opinion, the input-output model of W. Leontief (1936, 1966),
  Nobel Laureate in Economics, and its concrete orientation to the
  impact of the material and energy flow on the environment are
  mandatory instruments in the measurement of sustainability.
  Nowadays, this approach to measuring physical flows by intensity,
  direction, and effect on the economic process and the environment
  finds an increasingly wide application because it operates with
  specific, objective, and verifiable data, which gives reliable
  information about the ecological footprint of GDP production. The
  German scientist Schmidt-Bleek (1998) has suggested a
  differentiated approach that measures both the quantity and type of
  material resources that go into the production of a product unit (or a
  service unit) and the waste emissions from the production of a
  product unit (or a service unit). Two interrelated measures have been
  proposed by Schmidt-Bleek: the Material Input per Service unit
  indices (MIPS) and the “Ecological Rucksack” unit.
                 Ecological Footprint

• As an alternative approach, Bailey et al. (2000) divide the
  domestic supply of raw materials into scrap and newly
  extracted resources. This is an important differentiation as far
  as the use of nonrenewable resources is concerned. This
  model measures the ecological footprint through an input-
  output model which shows the material flows in industrial
  systems. This method has enormous potential in studying the
  relationship between economic activity and the environment.
  The authors of these methods have succeeded in including
  other factors such as the international division of labor and
  the share of natural resources used as factors of production—
  which are either imported or obtained by the domestic
  extracting industry—in their analyses.
A GDP Matrix: An Attempt for Systematic Approach
Gechev, R. (2005) Sustainable Development: Economic Aspects. University of Indianapolis
Press, pp.52-55



• The proposed matrix contains indicators that are connected
  with the GDP in a direct, indirect, or relative way. As indicated
  earlier, the indicators are expressed in an absolute or
  dynamic form (in percentage terms) and as GDP derivative
  indicators, which reflect the interaction between the
  economic sphere and the other three dimensions of
  sustainable development. The comparative analysis of the
  stated indicators for an individual country, for a group of
  countries, and especially at an international level would make
  it possible to assess with a sufficient degree of accuracy the
  state and trends of development in compliance with the goals
  and criteria of sustainable development.
 A GDP Matrix: An Attempt for Systematic Approach
 Gechev, R. (2005) Sustainable Development: Economic Aspects. University of Indianapolis
                                     Press, pp.52-55


• In my opinion, the most useful tool for assessing the
  ecological footprint of GDP production would
  indicate the energy and material intensity per unit of
  the GDP disaggregated by sectors, industrial
  branches, and types of production. Undoubtedly, the
  countries registering the lowest material and energy
  costs per unit of output are those enjoying the
  highest living standards. They also possess the
  biggest real and potential possibilities for
  maintaining, restoring, or maintaining and restoring
  the environment.
    GDP: Is it a reliable indicator for sustainable
                     development?
• The claim that the GDP is a poor and even misleading indicator
  of sustainable development is frequently encountered in the
  specialized literature devoted to problems of sustainable
  development. This argument does not seem to consider the
  fact that the GDP indicator has not been created to measure
  sustainability. It is highly illogical to define the GDP as a
  “devilish” or “misleading” indicator, although such
  qualifications can still be heard or read. There is little surprise
  in the fact that we cannot measure atmospheric pressure with
  a thermometer. The indicator in question works perfectly well
  for the job it was created to do. To a large extent, the model
  for calculating the GDP has been made universal; in other
  words, it is one of the most reliable indicators for the purpose
  of performing international comparisons.
  GDP: Is it a reliable indicator for sustainable
                   development?
• Besides, an available, accessible, and reliable database for
  each country and region exists, and GDP data compiled
  therein encompasses a sufficiently long period of time for
  trend analyses. Having been disaggregated in an
  appropriate and targeted way, the GDP and its relative
  derivatives can serve as a basis for performing a precise
  assessment of sustainable development. The advantage of
  this indicator is that it directly or indirectly reflects the
  environmental, social, and institutional aspects of
  sustainable development. The problem, then, is not
  whether, but rather how, the system of disaggregated
  indicators should be employed. My firm belief is that the
  GDP is not a misleading indicator but has frequently been
  misused.
      GDP: Is it a reliable indicator for
        sustainable development?
• If direct and indirect links exist between the
  environment and the processes of manufacturing and
  consumption, trying to find the complex of physical and
  monetary GDP characteristics related to them is more
  than logical. Neither the links nor the physical and
  monetary GDP characteristics indicate the exact state of
  the natural environment but give an adequate idea
  about the nature of the processes of interaction taking
  place, including the interactions from the sustainable
  development point of view.
     GDP: Is it a reliable indicator for
       sustainable development?
• Which arguments support this thesis? All experts agree that
  without economic growth, no social and economic
  development is possible. The development of technologies,
  social relations, the quality of life, and so on, is connected
  precisely with economic growth. One of the preconditions for
  the rise in the standard of living is the increase in the
  production of capital and consumer goods and services. In
  fact, the expanded production of capital goods and services is
  indispensable for the increased output of consumer goods
  and services. For people to consume more, more should be
  manufactured—what should be maintained is the growth of
  production. Because of this dependency, the level to which
  the social sphere is developed, as an important aspect of
  sustainable development, has a close positive relationship
  with economic growth.

				
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