[MUSIC] Hello, my name is Luis Mundaca and in this video I'll talk about the multiple conceptual grounds that the term 'Green Economy' involves. I will present how Green Economy as a concept has evolved from and been influenced by different schools of economic thought. The Green Economy concept is not new, but it became very popular outside of academic circles right after the 2008 and 2009 global financial crisis. The crisis was driven by numerous inter-related issues, including the subprime housing market, the credit crunch, the lack of regulation of financial markets, and the total collapse of large financial institutions. Some scholars also argue that unsustainable patterns of production and consumption also were key drivers of this crisis. The economic downturn that followed encouraged numerous pledges to reform our economic system towards a path much less damaging to society, the environment, and the financial system itself. As a result, numerous countries implemented green economy stimulus packages to reinvigorate production and consumption, particularly in the short term. And that time, the United Nations Environment Program (UNEP) defined a green economy as an economy that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities. In it's simplest expression, UNEP argued that a Green Economy is low carbon, resource efficient, and socially inclusive. So, what is a Green Economy, then? Well, conceptual choices about the green economy cover a wide spectrum. From larger aspects of sustainability on the one hand, to narrow concerns about the environmental pollution on the other hand. However there seems to be consensus on what a green economy should incorporate. And this includes job creation, poverty alleviation, reduction of greenhouse gas emissions, investment in natural capital, and ecosystem services, improvements in social equity and human well being, and also, increases in resource efficiency. From a theoretical point of view, the conceptual background of the term Green Economy spans many different schools of economics and other disciplines. First, one can argue that the term Green Economy was initially linked to agricultural economics. This was done during the so-called 'Green Revolution' in agriculture that occurred between 1940 and 1970. At that time, agricultural economists were studying and analyzing the issues that the green revolution brought to this economic sector, and they use the term Green Economy to refer to the positive impacts that research and technology development had on agricultural productivity. Welfare economics has also influenced or contributed to the development of the term Green Economy. This school of economics is concerned with the effects of economic activities on welfare or well-being. From a general point of view, welfare is often understood as the state of being healthy, happy or prosperous either as individuals or as a group. And welfare economics also provide a basis for the 'market failure' concept, which can be simply understood as the idea that if incorrect price signals are sent, market economies fail to achieve efficiency. Another aspect that is also captured by both welfare economics and the term Green Economy is economic inequality, that is the uneven distribution of income and wealth. Natural resource economics is another school of thought that has helped to frame or develop the Green Economy concept. This school of economics deals basically with the supply, demand, and distribution of renewable and depletable resources. A key objective for natural resource economics is to find ways to manage resource efficiently and sustainably so that they are available to future generations. In principle, a Green Economy should guarantee the capacity of natural capital that provides resources and environmental services in the long run. The physical accounting of environmental resources is the key element in natural resource economics. Which is also emphasized by the term Green Economy. Another concept milestone in relation to the term Green Economy can be found in the early foundations of environmental economics. When the 'environmental revolution' took place in the mid-late 1960s, economists claimed that the economics profession was ready and waiting. At that times environmental problems had been illustrated in books like 'Silent Spring', which documented the negative effects of the environment resulting from the indiscriminate use of agrochemicals. For the environmental economist, pollution is understood as a negative externality. Take air pollution for example. If an economic activity is reducing air quality, the health or welfare of a third party might suffer as a consequence. An environmental economist attribute this to the absence of prices for environmental assets like clean air, biodiversity, and clean water. Environmental economists were aware that any form of economic activity could cause not only benefits, but also costs. Early work on economic answers to environmental problems, supported the use of the term Green Economics for analyzing environmental problems and the management of natural resources from an economic point of view. Relying on the idea of sustainable development and also on the theory, the methods and the policy options provided by the environmental and natural resource economics, Pearce, Markandya and Barbier framed the term Green Economy in the late 1990s around technology innovation, resource efficiency, natural capital, ecological risk and human development. This work was summarized in their book titled 'Blueprint for a Green Economy'. This work stressed different aspects of a Green Economy, including environmental protection, economic management of environmental concerns, economic evaluation of environmental change, and also the role of prices for environmental protection. A new edition of the book was released in 2013. There the term Green Economy is anchored to three key areas. Accounting for the environment; valuing the environment; and policies for environmental protection. Energy economics, particularly the area that focuses on renewable energy and energy efficiency, can also be said to be contributing to or shaping the term Green Economy. This is because most policies encouraging a Green Economy have heavily targeted the clean energy sector. So investment in low-carbon technologies and climate mitigation strategies have been quickly portrayed as key components for the transition into a Green Economy. And sometimes similar concepts like the Low-Carbon Economy and the Clean Energy Economy are also used to refer to a Green Economy. Under energy economics, we can argue that a Green Economy focuses on how the economic system can pursue growth by bringing together economic, environmental, social, and technological aspects through the expansion of clean energy production, distribution, and consumption. Lately there has been growing attention to the term Green Energy Economy. Finally, ecological economics, where priority is given to sustainability and the economy as a sub-system of the ecosystem also influenced the term Green Economy. For instance, aspects of ecological scarcity and social equity included in the Green Economy term have also been put forward by ecological economics. There is a growing body of evidence that shows the rapid loss of ecosystem services and this situation has encouraged investment in and conservation of natural capital, which is also a critical aspect for the modern interpretation of the term Green Economy. Building upon other schools of economics ecological economies have also advocated for the economic value of ecosystem services and resources. Seminal work done by Herman Daly has also stressed the idea of an 'steady-state economy' in which the use of materials and energy, so-called 'throughput', in the economy is minimized. So as you can see the Green Economy is a very rich and intriguing concept that has evolved over time. The term covers linkages and analysis between resource efficiency, job creation, pollution prevention, clean energy technologies, poverty alleviation, greenhouse gas emissions, and natural capital, among several other issues. But if we want to transition towards a Green Economy, policies need to be substantially more ambitious and integrated to deliver meaningful transformation. [MUSIC]
