Economics of environment and development David Pearce and Ed Barbier
IIED can legitimately claim to have been one of the birthplaces of the economic approach to sustainable development. In 1988 the then UK Conservative Government sought a structured response to the Brundtland Report of 1987.1 The Brundtland Report was not the first international report to focus on the notion of the sustainability of economic and social activity, but it remains the most celebrated statement of the issues. The new focus was on forms of economic development that would permanently raise the living standards of the world’s population, and especially the living standards of the poorest people. The notion of permanent development was intended to avoid forms of economic change that would benefit generations now but impose unacceptable risks for generations in the future. Environmental quality was at the centre of this notion because so many current-day activities are characterized by exactly this intergenerational impact. The benefits of fossil fuel use are secured at the expense of damaging health and ecological effects now and well into the future, and perhaps especially so because of the contribution to climate change. Land-use change now secures benefits in the form of extra agricultural land, but deprives future generations of the lifesupport functions provided by biological diversity. These ‘trade-offs’
are by now well known. Brundtland’s challenge to national governments was to explain how they were going to tackle these formidable problems.