Course Name Development Economics (ECN 330)

Section No 01
Semester Name Spring 2024

Members

2220877 Habiba Shammi

2230163 Ateef Razzaque
Irfan Mojumder Kaif

Submitted To Dr. Md. Khaled Saifullah

 Green Growth: A Win-Win Approach to Sustainable
Development

Introduction

In the face of pressing environmental challenges and the urgent need to achieve sustainable
development, "green growth" has emerged as a promising approach that aims to reconcile
economic growth with environmental protection. Green growth posits that economic
prosperity and environmental sustainability are not mutually exclusive, but can be mutually
reinforcing. By promoting the efficient use of natural resources, the development of green
technologies, and the creation of green jobs, green growth offers a pathway to achieve
economic and environmental goals.

As the world grapples with issues such as climate change, resource depletion, and ecosystem
degradation, the traditional economic development model, which has often relied on the
unsustainable exploitation of natural resources, has come under increasing scrutiny. There is a
growing recognition that the current trajectory of development is unsustainable and that a
fundamental shift in approach is required to secure the well-being of present and future
generations. Green growth has been proposed as a potential solution, offering a framework
for economic growth compatible with environmental protection and the principles of
sustainable development.

Literature Review

The concept of green growth has been the subject of extensive research and debate in the
academic and policy realms. The theoretical foundations of green growth can be traced back
to the work of scholars and policymakers who have long recognized the need to reconcile
economic development with environmental protection.

One of the key intellectual precursors to the green growth concept is the notion of
"sustainable development," which gained prominence in the 1980s with the publication of the
Brundtland Commission report, "Our Common Future" (World Commission on Environment
and Development, 1987). The Brundtland report defined sustainable development as
"development that meets the needs of the present without compromising the ability of future
generations to meet their own needs." This concept underscored the interdependence of
economic, social, and environmental objectives, and laid the foundation for a more holistic
approach to development.

Building on the sustainable development framework, the "green economy" concept emerged
in the late 1980s and early 1990s, advocating for an economic model that prioritizes
environmental protection, resource efficiency, and social inclusion (United Nations
Environment Programme, 2011). The green economy concept emphasizes the need to shift
away from the traditional, resource-intensive model of economic growth and toward a more
sustainable, low-carbon, and socially inclusive approach.

The term "green growth" was later introduced by the Organisation for Economic
Co-operation and Development (OECD) in the late 2000s, as a more targeted and actionable
approach to reconciling economic and environmental goals (OECD, 2011). The OECD
defined green growth as "fostering economic growth and development while ensuring that
natural assets continue to provide the resources and environmental services on which our
well-being relies." This definition underscored the idea that economic growth and
environmental protection are not inherently incompatible, but can be mutually reinforcing if
the right policies and strategies are implemented.

Subsequent research on green growth has explored various aspects of the concept, including
its theoretical foundations, empirical evidence, and policy implications. For instance, a study
by the World Bank (2012) highlighted the potential of green growth to create new job
opportunities, improve resource efficiency, and drive innovation. Similarly, a report by the
United Nations Environment Programme (2011) argued that investing in green sectors, such
as renewable energy and sustainable agriculture, can generate significant economic and
environmental benefits.

The existing literature on green growth has also examined the role of specific policy
instruments, such as carbon pricing, green subsidies, and regulatory frameworks, in
promoting the transition to a more sustainable economic model (Veugelers, 2012; Hallegatte
et al., 2011). Additionally, scholars have explored the potential of green growth to address
social equity and inclusion, emphasizing the need to ensure that the benefits of the transition
are equitably distributed (Bowen & Fankhauser, 2011).
While the green growth literature has provided a strong theoretical and empirical foundation,
there are still ongoing debates and challenges. Some critics have argued that green growth
may not be sufficient to address the scale and complexity of environmental challenges and
that more transformative approaches, such as degrowth or post-growth economies, may be
necessary (Hickel & Kallis, 2020). Others have highlighted the potential risks of green
growth, such as the rebound effect, where efficiency gains are offset by increased
consumption (Sorrell, 2007).

Despite these critiques, the green growth concept has gained significant traction in both
academic and policy circles, with many countries and international organizations actively
pursuing green growth strategies. As the world continues to grapple with the pressing
environmental challenges of our time, the exploration of green growth as a viable approach to
sustainable development remains a crucial area of research and policy discourse.

Issue and Causes/Examples

The need for a new approach to economic development that reconciles environmental
protection and economic growth has become increasingly evident in recent decades. The
traditional economic growth model, which has often relied on the unsustainable exploitation
of natural resources and the generation of environmental pollution, has contributed to a range
of pressing global issues. These include climate change, biodiversity loss, and resource
depletion.

The current economic development model has frequently prioritized short-term gains and
rapid growth over long-term sustainability. This has led to the depletion of finite natural
resources, the degradation of ecosystems, and the accumulation of harmful waste and
emissions. As the negative consequences of this approach have become more pronounced,
there is a growing recognition that this paradigm is no longer viable.

Addressing these challenges requires a fundamental shift in how we approach economic

development. Rather than viewing environmental protection and economic growth as
inherently opposed, there is a need to find ways to integrate these two priorities in a mutually
beneficial manner. This new approach, often referred to as "sustainable development," seeks
to create economic prosperity while also safeguarding the natural environment and the
well-being of both present and future generations.

Sustainable development emphasizes the importance of renewable energy sources,

sustainable resource management, the promotion of circular economies, and the development
of green technologies and industries. It also calls for a more holistic consideration of the
interconnected social, environmental, and economic factors that shape the well-being of
communities and the planet as a whole.

Implementing this new approach to economic development requires cooperation and

coordination among various stakeholders, including governments, businesses, civil society
organizations, and individual citizens. It also necessitates a re-evaluation of policies,
regulations, and incentive structures to align them with the principles of sustainability and
environmental protection.

By embracing a sustainable approach to economic development, we can work towards a

future that balances economic prosperity with environmental stewardship, ensuring that our
economic activities are compatible with the long-term health and resilience of our planet and
its inhabitants.

Climate Change and Environmental Degradation

One of the most pressing environmental challenges facing the world today is climate change,
driven primarily by human-induced greenhouse gas emissions. The Intergovernmental Panel
on Climate Change (IPCC) has repeatedly warned that the impacts of climate change pose a
significant threat to both human well-being and the health of the planet's ecosystems. These
impacts include rising sea levels, more frequent and severe natural disasters, and changes in
precipitation patterns.

The IPCC's most recent report, published in 2021, paints a concerning picture of the current
state of the climate and the potential consequences if greenhouse gas emissions are not
significantly reduced. The report highlights the urgency of addressing climate change, as the
window for action to mitigate the most severe impacts is rapidly closing. The report
emphasizes that a global effort to transition away from fossil fuels and towards renewable
energy sources is crucial for limiting global temperature rise and avoiding the most
catastrophic climate scenarios.

In addition to climate change, the unsustainable use of natural resources has led to
widespread environmental degradation. This includes the loss of biodiversity, deforestation,
and the depletion of water resources. The Living Planet Report 2020, published by the World
Wildlife Fund (WWF), found that global wildlife populations have declined by an average of
68% since 1970. This alarming statistic underscores the severe impact that human activities,
such as habitat destruction, overhunting, and pollution, have had on the planet's ecosystems.

The report identifies habitat loss and overexploitation as the primary drivers of this
biodiversity crisis. As natural habitats are fragmented or destroyed to make way for human
development, many species are struggling to survive, leading to a troubling decline in global
biodiversity. This loss of biodiversity not only affects the intrinsic value of the natural world
but also has significant implications for the functioning of ecosystems and the provision of
essential services that support human well-being.

Addressing these interconnected environmental challenges will require a comprehensive and

coordinated global effort. This will involve transitioning to sustainable energy sources,
implementing conservation and restoration measures, and adopting more sustainable practices
in areas such as agriculture, resource extraction, and waste management. By taking bold and
immediate action to protect the environment, we can work towards a more sustainable future

that safeguards the health of our planet and the well-being of all its inhabitants.

Resource Depletion and Scarcity

One of the basic causes of tiredness and lack of natural resources lies in the current economic
model, which is based on growth and consumption without limits. This model has been one
of unsustainable extraction and use of resources such as fossil fuels, minerals, and fresh
water, which have accordingly gone through depletion and environmental destruction
(Krausmann et al., 2018).

Continued increase in the population is increasingly demanding the resources, and with the
increased consumption levels, hence raising concern of over long-term availability. Apart
from that, the extraction and use of such natural resources do have huge social and
environmental costs in the form of habitat destruction, pollution, and even displacement of
communities.

This, therefore, means to address the issue of depletion and scarcity of natural resources; a
shift needs to be done in a more circular and efficient economy in the use of resources, along
with efficiency in using renewable energy sources and responsible consumption of resources.
It therefore calls for identification and implementation of alternative resource management
strategies, investment in sustainable technologies, and emphasis on a more wholesome,
integrated approach between the economy and environment.

Unsustainable Production and Consumption Patterns

These have also been characterized by quite unsustainable patterns in production and
consumption, quite heavily reliant on linear "take-make-waste" models of resource use.
Natural resources are extracted, products are produced from the extracted resources, and after
that, they are disposed of again in the form of waste following the end of the designed life of
products. Examples of such include plastic pollution, electronic waste, food waste, among
others. The United Nations Environment Programme in 2021 reported that the total waste
generated across the globe had been increasing over time, with posed adversity on the
environment and human health.

Just an example would be the plastic pollution; it has by now literally littered every spot on
earth, with the waste heaps in the oceans, rivers, and landscapes just grown a lot bigger.

In addition, this type of plastic pollution, apart from harming the marine ecosystem and wild
fauna, is on the entry point to the human food chain, which possibly produces risks to human
health. On the other hand, the mountain of e-waste towering above is full of hazardous
components, possibly devastating for the environment if not sorted and disposed of properly.
Another major problem is food waste, where about a third of all food produced in the world is
lost or wasted, with most of it ending up on landfills and contributing to greenhouse gas
emission.

Such waste of resources—apart from the economic loss represented thereby—will also mean
environmentally relevant consequences, like unnecessary land use, water, and energy in food
production. These challenges are interlinked and necessarily need to be dealt with through a
complete sea change in what we should be doing in economic development: shifting from the
traditional resource-exploitative model to a sustainable, green growth approach.

This indeed calls for the need to reflect on the pattern of production and consumption, along
with the acceptance of a circular economy with a zero-waste principle, which would reduce
wastes and at the same time encourage the effective reusing and recycling of resources. These
are to attain such economic prosperity but at the same time protect the environment and also
ensure the sustainable use of natural resources. The green growth approach requires
realization, which should equally involve incentives and collective commitment across the
sectors toward transitioning into a more sustainable future.

Causes and Examples of Green Growth Implementation

The causes underlying the need for green growth can be traced to a combination of factors,
including:

1. Environmental Pressures: The growing recognition of the severe environmental

consequences of the current model of economic development, such as climate change,
biodiversity loss, and resource depletion, has driven the search for alternative approaches that
can reconcile economic growth with environmental protection.

2. Resource Scarcity and Price Volatility: The increasing scarcity and price volatility of
natural resources, such as fossil fuels and minerals, have highlighted the need for a more
resource-efficient and resilient economic model.

3. Technological Advancements: Rapid advancements in green technologies, such as

renewable energy, energy-efficient technologies, and sustainable agriculture, have created
new opportunities for sustainable development and economic growth.

4. Policy and Regulatory Frameworks: Governments and international organizations have

developed a range of policies and regulatory frameworks, such as carbon pricing, green
subsidies, and environmental regulations, to incentivize the transition to green growth.

5. Shifting Consumer Preferences: There is a growing demand from consumers for more
sustainable products and services, driven by increased environmental awareness and concern
about the impacts of current consumption patterns.
Examples of green growth implementation can be found across various sectors and regions:

1. Renewable Energy: Countries like China, the United States, and Germany have
significantly increased their investment in renewable energy sources, such as solar, wind, and
hydropower, as part of their green growth strategies (REN21, 2021).

2. Green Transportation: Cities like Copenhagen, Amsterdam, and Singapore have

implemented policies and infrastructure to promote sustainable modes of transportation, such
as cycling, walking, and public transit (C40 Cities, 2021).

3. Sustainable Agriculture: Countries like Costa Rica and Cuba have made strides in
implementing sustainable agricultural practices, such as agroecology and organic farming, to
improve food security and environmental sustainability (FAO, 2020).

4. Circular Economy: The European Union has introduced the European Green Deal, which
includes a strong focus on transitioning to a circular economy that minimizes waste and
promotes the reuse and recycling of materials (European Commission, 2019).

5. Green Finance: Financial institutions and investors are increasingly incorporating

environmental, social, and governance (ESG) criteria into their decision-making processes,
driving the flow of capital toward green and sustainable investments (OECD, 2020).

These examples demonstrate the wide-ranging efforts being made to implement green growth
strategies across different sectors and regions, highlighting the potential for this approach to
deliver both environmental and economic benefits.

Findings and Results: Empirical Analysis

The classified current research on green growth is through conducted analysis on OECD
countries and Developing countries through the distinctive approach.

Through the reference of previous research from working papers, The section is divided into
parts of environmental management, water adaptation measures, and climate change, with
specific measures on resource and environmental productivity for the OECD countries which
is distinctive compared with the developing and least developed regions.
Empirical Approach: A reference study on OECD countries

From the reference of MDPI published working paper on OECD countries, we have
identified that the parameters tested were evaluated on environmental innovations source
dataset collected through World Intellectual Property Organization (WIPO) statistical
approach data identified on green technology and green innovation with specific
macroeconomic measures.

The data measures provide a statistical illustration of factors contributing to the performance
on implementing green innovation of specific OECD countries on both micro and macro
levels. The dataset provides an assessment of innovation performance on both country &
firm levels. (Balcilar, & Agan, 2023).

The data further provides the formulation of innovation & environmental policies of
governments. (Balcilar, et. al, 2023).

Furthermore, Another distinctive measure approach was taken to assess the policies related to
classified environmental issues such as water, diseases, air pollution, biodiversity, habitat
& climate change. This includes unique approach measures of examining the technological
performance of nations with the integration of the Technological achievement index (TAI)
with consideration of sustainability & environmental outputs. (MDPI, 2023).

This empirical approach provided a distinctive notion for the research on OECD countries
with integrated measures of globalized involvement through technology diffusion, and the
approach toward innovation (MDPI, 2023). Average Green Growth Index Graph (OECD
countries illustration)
Figure: Time Series data from 1990 to 2020 OECD Statistics: ( available at
https://www.oecd.org/greengrowth/green-growth-indicators/)

The data set illustration provided the variables and growth index: green growth of 38
OECD countries. The measured data has variables considering various key factors involved
in environmental regulation and innovation with the technological innovation assessment
(TIA) measures considered when generating the results on the graph. The graph showed a
positive steady rate of green growth, with slight fluctuations from year 2015 and 2019-20.
Short-Overview of the Analysis of green growth measures in developing & least-developed
countries.

The factor of green growth and green innovation is a crucial notion for the development of
developing countries and least and least developed countries.

According to the report on green growth and sustainable development of developing

countries, green innovation or green growth has been termed as a sub-set for broader policy
of sustainable development and growth for developing countries. (Herman, 2023).

India, according to recent research has taken planned measures to control emission impact
and environmental degradation through policies implemented through sector-based measures
divided into specific sections with the targeted implementation of energy conservation and
regulating the output of energy emissions and air pollutants.
These policies had been extended in India on a regional level by government policies of
green innovation scheme, with the recent formulation of Green rating for integrated habitat
assessment. Green Urban Transportation scheme, Green innovation on electricity, and other
notable policies with few implemented targets of reaching by 2030.

According to the study reports, India has made remarkable progress in achieving the
reduction of regional emissions through the implementation of green innovation.

India reduced the emission intensity of its GDP by 24% between 2005 and 2016 achieving
2020’s pre-voluntary Target. India has a current target of improving emission intensity by
33%-35% by 2030. (GBI Report, 2023). The country also set its target for the Indian railway
to achieve becoming a net zero carbon emitter by 2030. India has achieved significant
remarks on green innovation, as India started its first green hydrogen manufacturing unit.
(GBI Report, 2023). The current concerns and challenges in developing nations, however, are
a broadened issue, and the developing countries listed have a significant gap regarding green
growth and environmental sustainability measures.

The recent study report on global developing nations' progress in green innovation, has
provided the claim, that current research on green innovation from developing countries is
problematic as developing countries' carbon emissions are increasing rapidly. (Herman,
2023).

Issues and Concerns on developing countries and green

growth measures: A short assessment

Current research on green innovation for developing countries on a global scale has extended
lacking as empirical and statistical data on green environmental assessments has not reached
a sufficient level and the disadvantaged capabilities of developing countries in conducting
diversified research with a comparison of the assessment of OECD countries. The report
identified one core issue still prevailing in developing countries which is a prevalent barrier
for developing countries on global measures towards green innovation. The report identified
and illustrated the current literacy problem on green growth and innovation with the global
south (developing countries) on a national level.
The graph illustrates sectorial gaps in green innovation, implementation of technology,
green growth sustainable innovation that is on developing countries, and is tested with green
innovation measures by Porter's hypothesis.

The demonstrated graph has provided an overview of the gaps and correlation of knowledge
and awareness factors for policy makers of developing countries which is a crucial factor
pointing to the failure of developing countries towards green growth on global measures.

These factors mark a significant requirement for effective assessments through further
quantitative and diversified empirical research methods which can proceed towards
conducted studies through a systematic and structured review of progress, potential
development, and the crucial problems that lie on the core for developing countries while
proceeding towards green growth.

Conclusion and Policy Recommendations

The green growth idea is a strong way to make sure we can grow our economy while also
taking care of our planet and using resources wisely. Studies show this method can help us
face big world issues like climate change, harming the environment, and using up resources.
From this study, we suggest these steps to help put green growth plans into action:

1. Make Full Policy Plans: Governments need to set up full plans that make it appealing to
move to a green economy. This could mean steps like pricing carbon emissions, giving green
bonuses, setting up rules for the environment, and putting money into green projects and tech.

2. Support Green Tech and Ideas: Both governments and businesses should put more money
into research and development to bring new green tech to different fields, like clean energy,
farming that doesn't harm the environment, and eco-friendly transport.

3. Help Green Business and Jobs: Design policies that help green businesses grow and make
more green jobs. This will push our economy towards being more sustainable and make sure
the gains from green growth reach everyone fairly.

4. Move to a Circle Economy: Make policies that support a shift to a circle economy, where
we waste less and reuse and recycle more. This helps cut down the demand on nature and the
environment.

5. Add Green Growth to National Plans: Governments should weave green growth ideas and
plans into their main development strategies, making sure caring for the environment and
using resources well is as important as growing the economy.

6. Work Together Across Borders: Solving global environmental problems needs countries
and groups to work together. Governments, global groups, and businesses should team up to
make policies work together, share what works, and gather the money and tech needed for
everyone to move to green growth.

7. Boost Public Knowledge and Action: Governments and other key players should spend
money on campaigns and learning programs to tell people about the good things green
growth brings and encourage changes in how people and shoppers act.

By taking these steps, governments and others involved can tap into the power of green
growth to lead to sustainable development, open up new business chances, and make sure a
better future for all, now and ahead.
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