ABSTRACT
This chapter looks at the concept of sustainable development and whether or not it is useful as a guide to the future. Market imperfections, including intertemporal externalities, open-access resources, and market power, create incentives that can interfere in important ways with the quest for sustainable development. Restoring efficiency is desirable and helpful but can be insufficient as a means for producing sustainable welfare levels. The Ecological Footprint provides helpful reminders that scale does matter and that the earth on which we all depend is ultimately limited in its ability to fulfill readers unlimited wants. The Human Development Index reminds us that the relationship between income growth and the well-being of the poorest citizens of the world is far from a sure thing, in contrast to what some would have reader believe. The Human Development Index identifies a number of low-income countries that have made great strides in ensuring that the fruits of development do reach the poor.
