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A “Hong Kong” model of sustainable development
Lawrence Wai Chung Lai, Kwong Wing Chau, Daniel Chi Wing Ho and Frank T. Lorne
Department of Real Estate and Construction, University of Hong Kong, Hong Kong, People’s Republic of China
Purpose – The purpose of this paper is to discuss a Coasian interpretation of a model of sustainable development for Hong Kong that incorporates three segments, namely economy, society, and environment. Design/methodology/approach – The approach is analytical, using concepts of property rights informed by Coasian neo-institutional economics and Yu’s ideas on the Schumpeterian process in innovation. Findings – First, the sustainable development criteria must be non-dictatorial, decentralized, and compatible with market economics. The emphasis is contractarian rather than legislative or administrative. Second, the essence of segment cooperation is to create a win-win situation rather than an “integrated” rent seeking game, which will likely result in more values being created. Third, the requirement that it be progressive over time implies that programs and policies that are duplicative need to be avoided, and innovations are to be encouraged. Fourth, the requirement of satisfying only two aspects of the three segments of cooperation implies a less stringent standard of making stepwise improvements, and thus makes entrepreneurial efforts more likely. Last, the three segments of cooperation, if practiced simultaneously and improved over time, can achieve most, if not all, the principles in the Rio Declaration without aiming at a specific principle in the Declaration. Research limitations/implications – This paper should focus on a “win-win” rather than a mutually exploitative approach to public participation in sustainable development promotion. Practical implications – This paper should assist policymakers and politicians in understanding how sustainable development may be conceptually modelled. Originality/value – The paper is the first paper that defines for Hong Kong a model of sustainable development on the basis of Coasian economics, and contrasts it with other proposed models. Keywords Sustainable development, Hong kong Paper type Conceptual paper

A model of sustainable development 251
Received May 2005 Accepted December 2005

Introduction Inspired by the design of a logo adopted by the Council for Sustainable Development (CSD), the purpose of this paper is to articulate a trinitarian “Hong Kong” model of sustainable development that can satisfy certain objectives of sustainable development in the long run without infringing upon the political, economic, and social constraints of Hong Kong as a polity in China. Although the term “sustainable development,” as popularly understood, was first defined in the report Our Common Future (“Brundtland Report”) by the United Nations’ (UN) World Commission on Environment and Development (1987) (the Brundtland definition), the first authoritative official set of UN principles of sustainable development that represents the consensus reached by a large number of

Property Management Vol. 24 No. 3, 2006 pp. 251-271 q Emerald Group Publishing Limited 0263-7472 DOI 10.1108/02637470610660147

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nations originated from the Rio Declaration made during the UN Earth Summit of 1992 (The United Nations Department of Economic and Social Affairs (DESA), 1992). Since, then, many countries and local regions have adopted various versions of sustainable development that each believe can most accurately capture the spirit of the Rio Declaration, which was so sufficiently broad that indigenous efforts to define sustainable development were not only permitted, but encouraged:
States have, in accordance with the Charter of the United Nations and the principles of international law, the sovereign right to exploit their own resources pursuant to their own environmental and developmental policies, and the responsibility to ensure that activities within their jurisdiction or control do not cause damage to the environment of other States or of areas beyond the limits of national jurisdiction (Rio Principle 2).


For any burgeoning new concept that can claim any significance, the stepwise development of the concept is indicative of a serious endeavour behind it. If one looks into the origin of the term “sustainable development” and its Brundtland definition made in 1987, the Rio Declaration is merely a statement of intention. Both before and after the announcement of the Rio principles, there have been substantial academic work and concept elaboration across various disciplines centring on the theme embedded in sustainable development. An example of a frequently cited milestone is the work of Daly and Cobb (1989). As a matter of government administration, sustainable development in Hong Kong has an ancestry of a drive to environmental protection during the mid-1980s, in which the Environmental Protection Department (EPD) was born. This fast growing department (Lai and Fong, 2000, p. 28) was grouped with the Planning and Lands Departments into the Planning, Environment and Lands Branch, which in turn became the Planning, Environment and Lands Bureau after Hong Kong’s return to China in July 1997. However, since 2000, the EPD was taken out of this bureau to be grouped with food in 2000, and then with the Transport and Works Departments in 2002. The first major government study to foster sustainable development, “sustainable development for the 21st Century study” (SUSDEV 21), was commissioned in August 1997 and completed in August 2000. The study was managed not by the EPD, but by the Planning Department. Out of SUSDEV 21 came the creation that was directly placed under the Chief Executive – a Sustainable Development Unit (SDU) in April 2001 to oversee an advisory CSD, established in March 2003. This comprised appointed public and private members. We can say that sustainable development in Hong Kong did not formally begin until the commissioning of a study on the subject, SUSDEV 21, although there had been laws, consultancies, and reports dealing with environmental issues prior to that study (Mottershead, 2004b, pp. 90-5). However, the term could be detected in an internal government paper from as early as 1993. Then, few people appeared to know what sustainable development was or what it meant. This posed opportunities, as well as dangers, for an appropriate institutional structure to emerge. The danger is greater in the sense that many have stuck to their “deep green” interpretation of the Brundtland definition and refused to accept its manifestation in the Rio Declaration[1]. Others, such as Doyle (1998), condemned the Rio Declaration and the ensuing Agenda 21 outright as endorsement of a globalised capitalist market economy. What is the current position of the Hong Kong Government and the wider community? A Hong Kong Declaration was made on February 26, 2004 in the Asia and

and revision. leadership and local governance. but they serve as an expository vehicle for a mission statement. increasing mobility. attempts to make predictable outcomes have seldom been successful. The risks and uncertainties of a human system are so immensely complex. tourism and cultural heritage. having met at the Asia Leadership Forum on Sustainable Development for Cities. beliefs. . a filing cabinet for interpreting emerging experiences. and . economic growth and job creation. para. often as guidelines and platforms for discussion on policymaking. but models will provide decision makers a system of rationality to make sense of what’s happening. business. models in the social sciences could merely be succinct and consistent descriptions of some selected dimensions of a real world phenomenon. planning a better environment for urban housing and land use. architecture is an aesthetic summary of the scientific. decision makers are bombarded by streams of visual. the scientific community. meeting basic social services. that need not always be the case. . In the social sciences. Undoubtedly. Models in the social sciences serve a different function. an actual scale model is used to represent a physical building structure. as illustrated below. This model is a miniature of something conceived by the architect. a methodology for creating solutions for issues raised. and other sensory data that in themselves might not have any inherent meaning. A model of sustainable development 253 The Hong Kong Declaration specifies the following policy and action areas: . Yet. 2004. social. . These models may or may not be comprehensive. a means for planning. At best. auditory. Why a “Hong Kong” model? Physical scientists build models to shoot rockets to the moon.Pacific Leadership Forum (Leadership Forum) convened by China and the UN (Asia and Pacific Leadership Forum on Sustainable Development for Cities. community groups. However. and economic infrastructure of a physical structure that serves a function beyond marketing. Models can also be used as a platform for planners to build some consensus[2]. The leaders who participated in the Leadership Forum thereby announced to the world: We. . the Programme for the Further Implementation of Agenda 21 and the Johannesburg Plan of Implementation. In architecture. Most people think architects should be designing and building models of physical structures as blueprints for construction. and values. as experiments with centralized planning economies in the last century have so miserably demonstrated. the representatives of national and local governments. . targets and recommendations contained in Agenda 21. professional institutions. or a summary of issues for comparative studies of alternative systems of the world. and the United Nations and other international agencies. Everyday. discussion. the term model may mean different things to different disciplines. 1). reaffirm our commitment to the goals. Those in marketing think of architectural models as means to attract buyers.

3 254 The architect-planner partakes in the debate over social policies in relation to sustainable development through the idea of “green buildings. and as symbolic gestures of a mission statement worthy of pursuit. general and abstract. he held that environmental needs should support group culture. the zero interest rate condition can arguably exist only in the longest of long shots[4]. However. The intent of the model must be kept in mind when thinking about the results. and thus a scientific dimension of architectural planning is not only relevant to the civil engineering and mechanical aspects of buildings.” Lewis Mumford. in which a community needed to be planned around the possibility of radioactive leakage from a contemplated nuclear dump. A much older interest of architectural theorists on the human and cultural aspects of design that goes beyond the functional needs of end-users can be traced back to what Franklin (2001) refers to as “people-environment studies. . and that a house needs to be interpreted as part as a specific system of settings and ideas (Rapoport. the concept in Brundtland’s statement is largely inconsistent with the idea of a positive interest rate. and needs (Rapoport. Amos Rapoport. Developing this theme further. but arguably involves many aspects of the physical and natural sciences. 2001. An extreme example of that is the planning of an underground community close to Las Vegas. Not only is there a human. However. models can indeed be seen as the architecture of institutions. “more specific and concrete variables derived from dismantling ‘culture’” can relate to various aspects of housing (Rapoport.. cultural.” However. But the shift in ideas of a highly influential figure in this arena of inquiry. This has had a great impact on the state of architectural research (Kohler and Hassler. What will be a good starting point for thinking about a model of sustainable development for Hong Kong? It will be easy to use the Brundtland definition of sustainable development. this idea has become replaced by the much broader idea of sustainable development. While a discussion on the human characteristics of housing may be controversial.” which stress environmental friendly designs and a life cycle management of properly designed buildings in terms of more efficient energy use. is a case in point. If a model of sustainable development is to be designed or described. Ho et al. p. is even more instructive. and has hence been rejected by many economists. and the conservation of elements of heritage and cultural values. as suggestions for perception formulation. 1990). Even generously interpreted. However.PM 24. 1977). better noise abatement.. Rapoport (1969) originally held that socio-cultural factors shaped built forms. 145). Nevada. values. the idea that a building has a life cycle or state of health similar to a human being has gained consensus among researchers in regards to the “sick building syndrome”[3] (Chan et al. The development of communities necessarily encroaches upon the natural capital of the earth. because these concepts are too broad. rendering it more multi-disciplinary and open to the views of others in decision making. 1961). the approach in doing so will necessarily be interdisciplinary. But models are made for a variety of reasons. As tools for developing a constructive dialogue. 2002). physical science enters the planning process in many important ways. 2004). author of the City in History (Mumford. or health aspect to architectural planning. Rapoport recently argued that “it is impossible to relate ‘culture’ (or ‘society’) or housing (or any built environment). 1985. 2004. as argued by Kohler (1999).

the Hong Kong model of sustainable development can be addressed both descriptively and prescriptively. principles of the Rio Declaration. any attempt to impose additional criteria on an existing policy framework has the danger of over-regulating. What is the “Hong Kong” model? Intellectually speaking. Indeed. a model can serve many purposes. 1962)[5]. there are existing policies that are relevant for fostering certain aspects of sustainable development already in operation. social welfare. Domestically. The type of policy that falls under sustainable development may be that what is related to the environment. rather than merely adopting a new name for a set of old problems. rather than a bigger. many international conferences have been organized to allow countries to share their experiences with one another. economy. . the danger of over-regulation by policies inspired by sustainable development cannot be underestimated (Friedman. it will be difficult to think of policies that are not considered a part of sustainable development. it is not policies per se that contribute to the essence of sustainable development. Models can also serve an international discussion and marketing purpose. slice of the pie (Buchanan et al. labour. capturing some. would lead to rent dissipation that. Indeed. and as a blueprint for future policies. Over the years. Second. Two Systems” component of China.. Presumably. an invitation to new policies that. and real estate development. the specification of a model should serve the purpose of identifying areas that create values (rents) rather than destroy values (rents). as long as it does not encroach upon the jurisdiction of other sovereignties. the remarks of scholars working in the area are duly recognized: . if unconstrained. Each country usually has its own paradigm of promoting sustainable development. in essence. First of all. It can also serve as an overall constraint on new policies to be adopted or developed. as pointed out in the introduction. housing. A model will also be useful for that purpose. Hong Kong [is] still struggling to operationalize the concept of sustainable development – more than 20 years after the term was first coined – [and] is actually in A model of sustainable development 255 . if not all. This way of perceiving sustainable development has the danger of being too general. every country and region of the world in principle could be free to define what it considers to be policies of sustainable development. in the long run. Before an attempt to do so is made. . Yet. 1980)[6]. it can be used for purposes of planning. any prudent policy-maker would have taken external effects into consideration when policies were originally designed. as a platform of debate. The good side of this is that it leaves considerable flexibility in terms of how indigenous people can choose the lifestyle and system in which they want to live in the future. For a traditionally free market-based system such as Hong Kong’s. Rarely would any sector adopt a policy independent of consideration of other sectors. In summary. health.Short of the “first best” (a term used by the economist to refer to the ideal). may lead to a smaller. acting as a vehicle to communicate for system comparisons. and one that is constitutionally designed to operate as a “One Country. and as a proxy description of a system in comparison with other systems – an intellectual dimension on comparative studies. it is tempting to think of sustainable development as merely consisting of a set of policies dealing with various sectors of a system in some comprehensive manner. The risk is that this is. Generally speaking.

some might pity that it exists only in fairy tales. This. with their underlying assumption about human nature. In the introduction. 2004. Methodologically speaking. By examining such issues as its material resource consumption. . For Question (2). could still be maintained if sustainable development ethics and principles were adopted.PM 24.. The objectives in defining a workable concept of sustainable development in the form of a model are more modest. 2000. Hong Kong and South China would do well to adopt its principles to develop a new form of capitalism that takes nature into account. In a foreword of the collections of essays put together by Mottershead (2004a). (4) whether (2) and (3) conflict with each other. b. let us first review several positions proposed by some NGOs and various professional coalitions in the area. has less to do with any fundamental inability to comprehend the concept but rather more to do with a society that is unwilling to redefine itself in accordance with the basic tenets of sustainability. p. . and (5) whether a resulting self-definition of sustainable development is indeed sustainable.3 danger of locking itself into a dead end which others have already recognized and attempted to circumvent in a positive and pragmatic manner. Lai and Lorne. Sustainable development. as Mottershead pointed out. (3) whether there exists a top-down meaning of sustainable development that is somewhat meaningful. I contend. the definition serves in many cases only as a catalyst[7]. The Brundtland objective is difficult to achieve. 2003a. 14). sustainable development as an ethical principle is unlikely to be widely accepted. This should be the research agenda of a broader nature that this paper will not go into. . (2) whether there exists a bottom-up indigenous meaning of sustainable development that has the potential to win a general consensus. land formation .. Indeed. is only an ideal. Hong Kong would be an ideal candidate because it presents a good example of an urban system with an unsustainable metabolism. Ask any citizen randomly in any major city of the world about his/her views on sustainable development. We ask: (1) whether a self-definition is permitted under an international declaration of sustainable development. it is a challenge to see if neoclassical economic concepts. Indeed. 2004). however[8]. For the purpose of searching for a concept of sustainable development that will be more compatible with neoclassical economics. as an ethical principle that citizens of the world should collaboratively help formulate. some of our earlier research works have advocated a win-win collaboration ethics as a foundation for pursuing sustainable development objectives (Yu et al. we contend that unless sustainable development principles formulated are compatible with human nature in some fundamental ways. Christine Loh of Civic Exchange has long advocated a concept of Natural Capitalism[9]. 256 No doubt what Hills had pointed out is true. . but the phenomenon is arguably not unique to Hong Kong. and the reaction is unlikely to be consistent. (Hills. sensitivity towards the constraint of “One Country-Two Systems” pointed out in Section I was evident: Natural capitalism should appeal to Hong Kong as it offers increased profit and an environmental solution . we already provided an affirmative answer to Question (1) based on Rio Declaration 2. Chau et al.

a common law professor. . and research in Hong Kong on sustainable development[10]. 104) asserted.and building construction. The Private Sector Committee on the Environment (now the Business Environment Council [BEC]) was established in 1989 by several large businesses and financial institutions in Hong Kong. and taking a lead in community participation. with a footnote reference to the work of Hanna et al. It would be unfair to say from this short statement that Mottershead. It presented the following vision on its web site: . “the right to development” or the concept of a “more efficient and equitable world economy” envisaged by Chapter 2 of Agenda 21. . Mottershead was. (italics added. 2004a. For example. Mottershead (2004b) made a sweeping complaint that there had been an absence of international engagement. that such notions as property rights and property values “had long been discarded internationally in favour of a broader-based perspective” in the sense that these notions were cherished by the stakeholders who expressed their views in SUSDEV 21. . Exactly as described. . italics added). we can build a picture of the city’s ravenous appetite and then see how consumption can be reduced dramatically but efficiency increased (Mottershead. This was amply revealed in the collection of essays put together in Mottershead’s study. After all. as well as certification programs.htm). but have not been successful in achieving government support or endorsement of these strategies (Mottershead. noted the following NGO activities: Both Friends of the Earth (FoE) and the Conservancy Association (CA) have provided strategic papers and ideas on sustainable development (CA’s Local Agenda 21. partnerships. to the business community and the public on the concept of sustainable development. the BEC has been active in recent years in providing various educational. 258-9). a point to be taken up below. p. (1996). promoting environmental education. p. A model of sustainable development 257 But an adopted version of sustainable development cannot be found (www. The said issues-oriented approach can also be seen among NGOs of the region. pp. in fact. the Conservancy Association adopted a mission statement: .hk/aboutCA/mainE. She also faulted SUSDEV 21 for ignoring the Rio Declaration. . As for sustainable King’s (2004) article. rightly or wrongly. but wrongly considered such notions to be private property and property values. and energy usage. Mottershead (2004b. few local academics have ever fought for the protection of private property rights in Hong Kong. and FoE’s 1996 vision for incorporating Sd government strategy. advocating appropriate policies. xxi. correct to say that a broader-based perspective is required because there is a tendency among legal practitioners to promote environmental legislation as a means to allow judges to assign rights. The idea of Natural Capitalism has. These “hongs” wanted to show the public that they were willing to “clean up their act”. But in one of her three articles. waste generation. conservancy. . Mottershead. notably the Territorial Development Strategy). 2001) . integration. titled “Sustainable development and civil society” in Mottershead’s collection of essays. characterized the early approach used within academic circles in regard to sustainable development movement in Hong Kong: one that it is piecemeal and issues oriented. this position can hardly be compatible with Rio Principle 2. has a dismissive view of private property rights for Basic Law-governed Hong Kong. monitoring government action. which is now supposedly guaranteed under “constitutional capitalism” (Lai. 2002). strategic direction.

” Facing what is called an “administrative rationalism” of Hong Kong. . We agree with Hills as regards to the need to be pragmatic about any proposal in respect of sustainability. Hills argued that SUSDEV 21 and the CSD notion of a “balance” between economy. (3) ecological modernization says little about social justice and Third World” as Dryzek (1997) and Hajer (1995) mentioned. p.3 That Hong Kong’s businesses can become a model for sustainable development in Asia through the integration of environmental and social responsibility into existing business practices (emphasis added). this approach “may well mirror current thinking within the Hong Kong Environmental Protection Department” (Hills. established nine years after the BEC in 1998. One might wish to step back and ask: what is the ultimate objective of civil involvement? According to King (2004. p. 40) “as a weak form of sustainable development”[12]. Indeed. and environment should be replaced by the idea of “ecological modernisation” (EM) as a transition to sustainable development. . . http://hksdf. Indeed. pp. . (2) “there is money in it for business. 259): . was similarly formed to coordinate efforts. 2004. Likewise. the HKSDF has endorsed and adopted a localized version of the Goals of the US President’s Council on Sustainable Development (italics added. but has not provided a specific definition for sustainable development. but provide no specific definition of it[11].susdev. Hills suggested five reasons as to why EM is most suitable for Hong Kong: (1) it does not call into question the continued existence of the capitalist system. Hills believed that a pragmatic interim solution is required. Dryzek (1997). citing works of Hajer (1995). ” The sustainable development definition provided on the web site of the HKSDF stated the following: Goal 1. hence. Hong Kong Special Administrative Region. society. A fundamental part of sustainable development is aiming towards a single objective and active interaction between all stakeholders and parties concerned so that all needs are taken into account” (emphasis added). should move away from its long established laissez faire “development principles. www. neither the HKSAR (Sustainable Development Unit.g. to support and participate in consensus building . and “to foster. 15-21) proposed to view sustainable development as “an environmental Developing the theme mooted in Hills and Welford (2002). htm) nor many other regions of the world may wish to endorse a single objective of sustainable development to be their goal. It cannot be said that this methodology of approaching sustainable development is necessarily a good idea.Sustainable Development Generally To bring our mission to fruition in Hong Kong. Hills (2004. other NGOs (e. . 258 The Hong Kong Sustainable Development Forum (HKSDF).gov. 39).PM 24. Hong Kong. World Wildlife Fund Hong Kong (WWFHK) advocates conservation and a reversal of environment degradation. raise awareness. The Hong Kong Council of Social Services) basically support a vision for promoting sustainable development in Hong Kong.” Characterised by Hills (2004.htm#objectives).

Environment. But apparently. Davoudi. reflect a lack of direction! The logo might have had its origins in the SYSDEV 21 Final Report of 2000. at best. para. the manager must also note that cooperation is to be repeated in different forms and in different projects over time[14]. A model of sustainable development 259 EM has been referred to as “green capitalism” (Connelly and Smith.2)[13]. capture more of a sense of relationship rather than a sense of causality. 58) and criticised for supporting liberal market economies and existing government structures and failing to resolve the fundamental problem of a society driven by “wants” rather than “needs” (Mottershead 2004c. a manager of sustainable development must pay attention to how the three areas of cooperation can be pursued simultaneously. p. is “technical and procedural innovations. the theme it seeks could be most succinctly described by the logo representing it. there may be different interpretations for the logo of Sustainable Development of Hong Kong that the CSD may hesitate to make explicit. as its three key words constituted the “planner’s triangle” (Batty. an evasive political stand in this instance may generate false expectations in various . 2001. simultaneously achieving a vibrant economy. in fact. The means to attain win-win solutions. However. with arrows pointing in a direction that. p.” While a “Hong Kong” model of sustainable development probably cannot be conclusively described. 76): Ecological modernisation argues that economic growth is not the enemy of sustainable development. a transformation of the term “Environmental Modernisation” (eM). the aspiration to resolve the compatibility of EES in a region should be viewed as a continuous and trinitarian effort. 249). and (5) EM is not concerned solely with industrial production. 2001).e. in fact. the circular ring of EES with a directional arrow could be a three dimensional configuration with the arrow representing a progressive element of time. become the prevailing model for planning institutions in Europe (Batty. The logo is in the form of a circular ring consisting of three segments labelled Economy. Indeed. at worst. 5. nationally and internationally. 1999) and holds that a win-win approach is feasible (Davoudi and Layard. the idea for the logo originated from the planner. both for present and future generations. eM (or EM) has.(4) ecological modernization can provide a framework within which to develop partnerships between the public and private sectors (i. but with the environmental efficiency of the economy as a whole (the author claims that it is particularly suitable for problems related to Pearl River Delta’s integration). 2003. First. and. p.3. That is to say. there is a need to note that EM is. as adopted by the CSD. To put Hill’s ideas in context. 536). indeed economic growth is seen as necessary to achieve environmental improvements and sustainability. social progress and better environmental quality. and Society (EES). economic and environmental needs. through the efforts of the community and the Government (SYSDEV 21 Final Report. which was coined by Michael Jacob of the Fabian Society (Jacob. Broadly interpreted. 1999. p. with whoever or whichever country or region utilizing this model being required to do two things. according to Hajer (1996. Second. in which sustainable development in Hong Kong entailed the following definition: Sustainable development in Hong Kong balances social. 2003). through cooperative environmental governance). locally.

must be seen as a two dimensional representation of something taking place over three dimensions. The logo. and economy. (3) Model (c). is worse than (b) due to conflicts of objectives without any rule to resolve them. “participatory processes. Indeed. which can be compared to the Aristotelian cycle of “monarchy. and environmental considerations” (Mottershead 2004c. social. therefore. the idea of a participatory approach. democracy and tyranny” can only spiral down (rather than spiral up) in terms of the total level of satisfaction for all three components.PM 24. 8). 6). The declaration urged for the implementation of actions “in a spirit of partnership” through “a participatory approach” (para. as any thing. (2) that there is a one-way circular flow of causation from one to the next in either direction. with the arrow denoting a circular spiral of projects created over time. At least three interpretations could be seen as plausible interpretative variations of the logo: (1) that there should be a mechanistic balancing of the voices of the interest groups representing the environment. society. 20) may not always entail “a spirit of partnership.g. may lead to a rapid collapse in the environment (e.17) tends to produce an environment for arbitrary allocation of resources. but have to be done better each time[15]. say. 537). a divorce of endeavours. but in the limiting case. a fatalist trap of lock in a cyclical succession of different emphasis in terms of decisions made or outcome one at a time. However. as one possible way to particularise Mottershead’s idea of “interconnectedness” or “integration of economic. p. could arguably have economic consequences more favourable than those of these three interpretations: (1) Model (a). and hence. The most important issue is the lack of a clear model for organising various . Model (c) is equivalent to no models at all. 13). as described in this paper.17) and “community involvement” (para. where the environment itself becomes a battleground). The idea of partnership suggests the existence of win-win solutions. However. the idea of providing “favourable fiscal and financial incentives” (para. or entity. (2) Model (b). idea. would not only lead to a fall in overall efficiency and the ability to generate wealth. Although supportive of a developmental and human-centred approach and endorsing of the CSD idea of securing economic.” (para. In other words. sustainable development can be a journey. opportunities for rent-seeking activities or “obstacles and constraints to progress” (para. However. the Hong Kong Declaration has many ambiguities and potential conflicts that need to be resolved. social and environmental dimensions. The three elements of cooperation not only need to be practiced at the same time.3 260 directions that consume self-dissipating resources. egalitarian pluralism in decision making as regards resource allocation. our proposed interpretation.” The declaration also correctly pointed out that fighting corruption is a major link in governance (para. will be perceived as consistent with the model as long as it mentions the magic words implied by E þ E þ S. or (3) that the three components are going in different directions independently of any status quote starting point.

.goals and objectives that pertain to the environment. and perhaps more realistic. . Donald Tsang. Sustainable Development Council Chair and then-Chief Secretary of Administration of the HKSAR. . if practiced simultaneously and improved over time. and could . A model of sustainable development 261 There is no question that much work remains to be done on implementing sustainable development as a general culture that also addresses business and social interests. economic. Yet. economy. Hong Kong would like to claim that all three aspects of cooperation (i. As far as economic growth and job creation are concerned. if not all. In order for the concept to be useful and significant. to believe that certain aspects are being fulfilled better than others. and have made Hong Kong the best in the world in this sense. 2004). In the preface to a BEC publication titled Introducing the Hong Kong Business Guide to Sustainable Development. decentralized. and compatible with market economics. benefiting both present and future generations. and society. which will likely result in more values being created. wrote: Many entrepreneurs may feel uncertain about how to incorporate the important concept of sustainability into their business operations in order to benefit their stakeholders. environmental. Entrepreneurship has certainly been an emphasis evident in some of the literature attached to the concept of sustainable development in Hong Kong.15).e. . it will be more modest. There are reasons to believe this interpretation of the “Hong Kong” model of sustainable development can increase values (rents) rather than dissipate values (rents): . (Business Environmental Council. but there is no reference to the possibility of a spontaneous emergence of innovations. The sustainable development criteria are non-dictatorial. The essence of segment cooperation is to create a win-win situation rather than an “integrated” rent seeking game. The emphasis is contractarian rather than legislative or administrative. As pointed out in the previous section. their business partners and their employees. A model will help define the task. it may be important to emphasize a certain uniqueness and creativity of the system that is inherited from market economics. . the idea is “the adoption of advanced and appropriate technology” (para. and social) have been fulfilled equally well. and thus makes entrepreneurial efforts more likely. A statement of intent is just the beginning. can achieve most. the principles in the Rio Declaration without aiming at a specific principle in the Declaration. . The three segments of cooperation. Ideally. The requirement of satisfying only two aspects of the three segments of cooperation implies a less stringent standard of making stepwise improvements. sustainable development should not just be a set of old problems with new clothes. Such creativity is essential for tackling location-specific sustainable development problems. The requirement that it be progressive over time implies that programs and policies that are duplicative need to be avoided and innovations are to be encouraged. In order for the engine of sustainable development to get rolling. policies and programs coming out from sustainable development should increase total values in overlapping generations.

Entrepreneurial policies and programs may be viewed as arising from a private-public cooperation that can be considered an “add-on” rather than a “displacement” for either a private or public function. It is also consistent with the general constitutional principle of “One Country Two Systems. The Hong Kong Sustainable Development model. Thus. with governments serving nothing more than as information platforms.” If so.” under which Hong Kong is supposed to operate. Elements of uniqueness .PM 24. It can be done by involuntary nationalization. the Hong Kong model of sustainable development can be perceived as prescriptive rather than descriptive. To be sure. The “Hong Kong” model as a Coasian model of sustainable development The “Hong Kong” model of sustainable development is Coasian and may want to seek reference in terms of prior academic work done in this area. market means of cooperative features are expected to evolve more than the regulatory types as futures unfold. and to re-express the will to improve the structure to a higher level in the next round of the circular journey of sustainable development. as pointed out earlier. all countries and regions of the world are trying various ad hoc experiments to make them “better” places in which to live. However. and with a will to continuously develop in the form of a spiral circular journey as asserted. the Hong Kong model of sustainable development. To the extent that this direction of development is to be encouraged. coaching and education in order to put abstract wills into concrete programs. not shrink. It is on this basis that the size of the pie can be expected to grow. the model is so sufficiently general that even if all aspects are currently somewhat deficient. which include both policies and programs conducted at various regional levels. Thus. but act Locally. the segment of cooperation that is more prominent for a region will likely depend on the growth phase of the region. this process will not come about easier than shooting rockets to the moon. Any region of the world with a market-based system could embrace a similar basic principle. may also have the potential to be developed into an international model. such a model of development might achieve a more pragmatic result. There is a saying among practitioners in the area of sustainable development: “Think Globally. to some extent. the model can still be used to evaluate that deficiency. Indeed. can nevertheless be fitted into a general model. Experiments. or explicit law. They can also be furnished by voluntary contracting via a process of consultation and negotiation.3 262 hence be used as a showcase to the rest of the world. human ingenuities require stimulus and. With respect to the Pearl River Delta integration objective recognized among policymakers and academics alike. Yet. the model is consistent with various educational and certification programs that are already ongoing in the region. global experience can be localized. this type of private-public cooperation requires ingenuities originating from the citizens and firms interested in the building of their community. while other aspects can be improved.” This type of thinking is consistent with the spiral circular methodology where cumulative global experience can indeed be localized. there will be a difference in the means various countries use to enact this cooperation. broadly interpreted. explicit regulation. has adopted the position that government should act as “an enabler for the markets. Indeed. In practice. while developed for the primary purpose of serving local citizens. While there is currently no existing methodology to evaluate such a functional relationship.

it must be pointed out that there is always a stochastic element involved in any externality as an opportunity to be explored both technically and socially by engaging in Schumpeterian experiments (Yu et al. That.” We hold that we do not need to fit the current proposed model into a historical framework. It is tempting to fit our concept in such a historical framework as that of the “macro-history” of historian Huang (1990. Lai and Lorne. Moreover. Central to the above idea is the Coasian notion that any externality can be captured as a resource (Coase.. as it is for the structuring of a win-win contract (a set of reciprocal promises that are mutually beneficial) for the parties involved. 1993. b. 2006a. the Coasian framework of sustainable development focuses on seeking adding dimensions to a previously existing framework of interactions. Such experiments can only take place where the parties involved have an implicit awareness of cooperation and developing a “win-win” solution. 2005. .. Lai et al. and the present is the result of selfish and idealist behaviour.. Yu et al. and thus. Indeed. p. except that it would evolve stochastically as a positive spillover. p. Huang’s idea is that history is the product of past efforts. it can be shown by examples and case studies that the bargaining parameters envisioned in the Coasian framework of sustainable development are significantly different from that of the original Coasian framework of bargaining (Lai and Lorne. Yet. rather than the need to play a game of prisoner dilemma. A model of sustainable development 263 . 1995. Mathematically.. .and creativity are very much an important ingredient in any framework of sustainable development (Yu et al. Concepts of such development have been ongoing (Lai and Lorne. 2000) of various sorts. the very essence of sustainable development puts a very different meaning to the concept of time by going beyond the concept of mechanical time. Without these elements. with progress most efficiently driven by systems that are “mathematically manageable. 2003a. is the essence of a Schumpeterian experiment. b). 145). Lai and Yu. 265. 2004. A version of this concept is articulated as follows: . as private incentives in a market environment would have provided for such sustainable programs already. b. history may not repeat itself! Neoclassical economists may also question whether the concept itself is merely a semantic variation of the Coasian original proposition of bargaining. and we can anticipate criticism from various angles. The model is surprisingly simple. b. The existence of entitlement or rights to natural resources is as important a precondition for such an experimentation (Lai. 2006a. Negative externalities can be curtailed and even transformed into positive ones if the parties involved are willing to experiment in a transformation of regular practices and mindsets. 2006a. 2000). while the original Coasian framework of bargaining focuses on seeking the optimal equilibria of fixed dimensions. It proceeds rationally in a teleological manner upward and outward. We argue that mathematical modelling will not be possible. 2000). it can be questioned whether there is indeed a role for the government to act in this arena. b). at least not as a conscious choice. The role of the state is to establish and protect resource entitlements and facilitate voluntary negotiations among parties. 2003a. 1960). Mathematical theorists of all persuasions would scoff at the use of the term “model” in describing the concept. we repeat.

and there is perhaps no uniform answer for the general question of choosing between the redevelopment of neighbourhoods in the old urban core vs new development in the new territories. the redevelopment of old neighbourhoods that the HKSAR Government is currently contemplating. such an evaluation exercise has been conducted in a decentralized manner. but the department has also designed a win-win-win solution that benefits third parties (by reducing health risks). developed a masters degree course “sustainable development and property rights. Aside from the few examples that were described in previous studies. which include the Centre of Urban Planning and Environmental Management in the Faculty of Architecture. ongoing research in the Faculty of Architecture at the University of Hong Kong entailed a development of infrastructure more conducive to the operation of the market principle. in one form or another. we agree entirely with Mottershead that sustainable development may require going beyond the issue of property rights per se. . and neither the government nor property owners need to pay for the assessment directly. helped edit a special issue of the journal Aquaculture Economics and Management in 2002 (Hodgkiss and Lai. Therefore. Take. Member departments and centres. All. that we think may contribute to decisions being made on this question. for instance.3 264 The Coasian framework of sustainable development really requires lawmakers to go beyond a mindset of finding solutions to problems by increasing the quantity of rules. 2003) in collaboration with ecologists. not so much as a descriptive statement of what has happened. Admittedly. The application of the Hong Kong model We hold that there can be a large variation of situations in which a win-win model can be applied to Hong Kong’s situation. To be sure. Besides. with the Department of Real Estate and Construction of the Faculty of Architecture playing a pioneering role.PM 24. there have been works done in the Faculty of Architecture at HKU. which was prompted by a safety and health crisis in 2003 due to the outbreak of SARS. The BHHI classifies buildings into different grades (A. The case-by-case nature of this problem is easily recognizable. but that is not necessarily the right solution in any scenario. and U) based on an individual building’s level of achievement in safeguarding its health and environmental hygiene.” and established a building classification scheme (BHHI)[16]. as described by the model discussed in this paper. for example.000 per building) can be costly. B. and thus “assigning rights and liabilities” as such. A Centre of Excellence for Sustainable Development with seed money was established at the University of Hong Kong in the late 1990s. have been promoting sustainable development in the use of marine and land resources since the early 1990s. “sustainable cities” has become one of the multi-disciplinary strategic research themes prioritised by the university. Recently. but rather as a prescriptive statement or speculation on what could have happened among Hong Kong’s development episodes. The reliance on observable data ensures a high level of objectivity. The Department of Real Estate and Construction. the inspection of a building (estimated at HK$20. although sometimes it has involved the input of multiple professional bodies. Yet. It also made a contribution to the Encyclopaedia of Life Support Systems of UNESCO (2004). a legal framework that has tradable property rights could be an important option. and perhaps some works conducted by NGOs. have contributed to a win-win policy. C.

which. and also to reduce transaction costs in policy development and consultation in light of these constitutional constraints. it is a developing subject that will benefit from continued rethinking and innovations. but space does not permit a dedicated theoretical discussion here. In this way. the BEC attempted a Hong Kong Building Environmental Assessment Method (HK-BEAM) in 1997. See Mawhinney (2002) for some definitions of this “deep green tradition. For a Pearl River Delta integration initiative. b) for an economic characterisation of the idea of sustainable development.” The Schumpeterian dimension of the model puts emphasis on innovation and new ideas. b. 1995. A “Hong Kong” model of sustainable development can (and should) be articulated for the purpose of raising citizen awareness and an overall appreciation of the concept of sustainable development. We hold that neither position is tenable.For example. but an invitation to debate. any subject has to be one who has some property rights or entitlements. with the market code of “win-win” as the guiding principle. 2003) for a complete opposition approach. would certainly raise the standards of intellectual discourse on (and hence means to) sustainable development. As both land leases and capitalism are protected by the Basic Law. if well substantiated with good arguments and data. and thus could become a party to contract or negotiation. sustainable development can be incorporated into a Coasian economic “model” informed by Schumpeterian reasoning. “out of the box. b. what we propose is more about governance and institutional structure that would be conducive to sustainable development. See Yu et al. 1997a. which denies that sustainable development is meaningless. By defining the model in terms of institutional structure rather than the end result. What is more. as well as other tertiary institutions. Rather. rather than on confrontational politics. In this way. and interests as well as changing parameters. 1998a. to resolve conflicts. the proposed model should help resolve some present conflicts. 2005) in which private development rights are allocated by sale. Notes 1. as well as cater to future innovations. (2000) and Lai and Lorne (2003a. 2004.” in the proposed model. This model can deal with both the need for conservation and economic and social development. b. The model proposed by the authors is not so much a description of or prescription for what sustainable development would or should look like. also attempted a similar assessment of evaluating local public goods that may handle environmental and architectural enhancements in various ways. This is an attempted approach to a highly contested subject. about which there are so many different viewpoints and conflicting values. Suffice it to say.” See Beckerman (1992. 2002. as to be demonstrated in this paper. in a way. While the authors have not assigned a “subject” to the verb “win. the model itself is “sustainable” even in the midst of conflicting viewpoints. c. Conclusion Land use planning in Hong Kong under constitutional capitalism is a matter of “planning by contract” predicated on a leasehold land system (Lai 1996. it is believed that the model so articulated has a better chance of gaining consensus for across-the-border decision-making processes. This is not a claim to truth. 2006a. the model may hopefully improve the quality of the current debate on sustainable development and help suggest a solution that is. HKU. A model of sustainable development 265 . any model of sustainable development for Hong Kong has to embrace these features. values.

2003: the remark by the committee was made under “Item 1 – Opening Remarks by the Chairman. “The BCR (Bruntland) definition of sustainable development has. been the catalyst for somewhere between 200 and 500 other definitions around the world” (Mottershead. 2001) or the publications of her peers. Loh. 4. brackets added). The term may also be traced to a book by Hawkins et al. is also a member of the Council of Sustainable Development of the HK Government. 8. the wording in the Digest of Meeting on April 1.3 266 2. Christine Fang. According to a version prescribed by Ms. which include discussions within academic circles. etc. and is not usually accustomed to such an abstract conceptual characterization of the problem. depending on the literature reviewed. This definition was heavily criticized by Mottershead (2004b. and (3) reversing the destruction of the Earth with programmes for restoration and investing in the Earth’s natural capital. 5. whereby waste is reduced or eliminated at the production stage. p. 3. on some hotly debated specific policy issue. manifestations of this nature of the problem can be abundantly found. Sensitivities on this inherited constraint of the system can be found in various governmental. Those who studied and understood Irving Fisher’s Theory of Interest (Fisher. The later endeavours. (2) shifting the structure of the economy from focusing on the processing of materials and the manufacture of things to the creation of services. Note. Canada. NGOs. Hong Kong traditionally operates pragmatically. 2000) accepts the substitutability of resources. For definition. Chief Executive of the HKCSS. See Lai and Yeung (2004) and the related papers and positions articulated regarding the issue of preserving Victoria Harbour. however. sustainable development charretes are run by architectural guru Patrick Condon. In Vancouver. 9. and that the research objective stated here should be laughed at. casual conversations with citizens on the subject. Mottershead was apparently ignorant of the existence of doctoral theses on sustainability written on Hong Kong by Hong Kong students (Shulman and Shulman.. who argued that Hong Kong should have adopted a definition achieved by the Brundtland Report. 7. 12. 1930) will reject the concept of sustainable development in the Brundtland sense altogether. 1991. 11. To some environmental activists who believe that the world is a zero-sum game.PM 24. 1990. Rees. until a model has been built to show compatibility with the force of gravity. we only have to pose to them a simple architectural question: is it possible for a building to be constructed from the top floor? The question would have been equally laughed at as being anti-gravitational – that is. members agreed to adopt initially the definition in the report of . 6. 13. thereby discouraging the production of waste where no one is responsible for it. She spoke at the Seminar in 2001 on “The Role of NGOs: Releasing Goodwill and Building Partnership for Action” – a position that is consistent with the model described in this paper. “Natural Capitalism” consists of the following three principles: (1) eliminating the concept of waste by re-designing the economy. However. Hirshleifer (1970) reviewed various schools of thought on interest rates and described the zero interest rate condition as a special case that occurs in the longest of long shots. 103). as well as non-governmental. will be further elaborated on in the next section. 1989. 10. 1999). 2004a. discussions of the problems. (1999). see Environmental Protection Agency (1991). Pearce and Barbier. “weak sustainability” (Pearce et al. for example. However.” in which the wording of the paragraph was: “Having considered the need for a ‘tailor-made’ definition of ‘sustainable development’ for Hong Kong. As opposed to “strong sustainability” (Daly. The city of Vancouver and the greater region of Vancouver retained such architectural consultants as the Sheltair Group to perform similar tasks.

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Further reading Ackoff.T. Hong Kong. T. W.L. House Form and Culture. Journal of the Operational Research Society. Hong Kong University Press.PM 24. Home Environments. Oxford University Press. (1979). pp. Y. Shaw. E. Pearce. W. A. (Ed. pp. and Barbier. Rapoport. Mumford.L. Sustainable Development in Hong Kong. Rees. Vol. 89-138. L.W. D.E. pp..). A. Chapter 4.). “The future of operation research is past”. and Lai. pp. (Ed. Hong Kong University Press. “Property right approach to sustainable development”. Human Aspects of Urban Form: Towards a Man-Environment Approach to Urban Form and Design. The United Nations Department of Economic and Social Affairs (DESA) (1992). “EOLSS online: welfare economics and sustainable development”. “Achieving sustainability: reform or transformation?”. (1990).T. 20 No. 17 No. Oxford. 2. (Eds).E. www. Rapoport. A. T. (2004b). Our Common Future. Mottershead. 93-104. Hong Kong. . L. Blackwell Science. (1989). culture and housing”. F. Rapoport. London. New York. I. M. R. “Sustainable development in Hong Kong: a road yet to be travelled?”. Rapoport. in Satterthwaite. Eolss Publishers. (1961). “Systems of activities and systems of settings”. S. World Commission on Environment and Development (1987). Vol. Hong Kong. D. in Altman. in Mottershead. Vol. 291-309. Pergamon Press. T. Environmental Economics and Policy Studies. Shulman. (Ed. A. (1969). pp. 18-23. Hong Kong University Press. Sustainable Cities.).C. “Thinking about home environments: a conceptual framework”. The Ecologist. Vol. Oxford. Rees. A. Sustainable Development in Hong Kong. London. 4. Housing. Rapoport. (Ed. Cambridge. (1977). 30 No. its Transformation and its Prospects. 3. (1999). 145-65. Theory and Society. Mottershead. pp. “Theory. Yu. and Shulman.htm UNESCO (2004). (2001).un. 255-86. (2004a).eolss. NJ. (Eds). Oxford. (2002). in Kent.). 3 No. (1990). E. 9-20. “Sustainable development in Hong Kong: a road yet to be travelled?”. Prentice-Hall. Mottershead. Oxford. pp. Hong Kong University Press. 22-52. The City History: Its Origins. Report of the United Nations Conference on Environment and Development. (2004c). Fu. London. Markandya. Hong Kong. Doctoral Dissertations on Hong Kong 1900-1997: An Annotated Bibliography. Developed under the Auspices of the UNESCO. June 3-14. (2001). pp. Cambridge University Press. Domestic Architecture and the Use of Space. 2. T. I. Englewood Cliffs. Blueprint for a Sustainable Economy. D. Encyclopedia of Life Support Systems (EOLSS). Sustainable Development: Understanding the Green Debates. Sustainable Development in Hong Kong. W. NY. (1985). London. T. pp. conf151/aconf15126-1annex1. Pearce. and Barbier. MA.3 270 Mawhinney. 529-54. Conclusion. in Mottershead.. (2000). “Rio declaration on environment and development”. A. T. Secker & Warburg. available at: www. Earthscan. Blueprint for a Green Economy: Report for the Department of the Environment. D. in Ng. Earthscan. Earthscan. Plenum. and Willis.J.C. and Werner. (2000).. “The ecology of sustainable development”.

C. (Eds) (2001). K. (Ed. Layard. T. “International sustainable governance”. Sustainable Development in Hong Kong. S. pp.. Lam. 175-98. A model of sustainable development 271 To purchase reprints of this article please e-mail: reprints@emeraldinsight. London. . NY.Barron. Spon Press.. Lorne. Lai.). T. “Economics of gei wai shrimp culture in Hong Kong: from commercial aquaculture to bird production”. (2004). Chapter 4.T. Hong Kong. B.. L. Corresponding author Lawrence Wai Chung Lai can be contacted at: wclai@hku. T. in Mottershead. (2004).emeraldinsight. Architecture as a Home for Man: Essays for Architectural Record/Lewis Mumford.W. Planning for a Sustainable Future. S. and Batty.K. J. Sustainable Development in Hong Kong. paper presented at World Aquaculture Society Conference. (2004). pp. (1975).com Or visit our web site for further details: www. Mottershead.). Hong Kong. and Wong. Hong Kong University Press. Davern. Hong Kong University Press.H. A. (Ed. Davoudi. “An economics perspective on sustainability”. F.M.K. in Mottershead. New York. Architectural Record Book.

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