Professional Documents
Culture Documents
INTRODUCTION
OVERVIEW OF SUSTAINABLE DEVELOPMENT
Considering the dimension of the crisis, which started in 2007, this was not very
surprising. The crisis didn't look like another business cycle setback, a temporary
overheating or a sectorial bubble such as the previous ‘dot-coms crash’ of 2000.
SUSTAINABLE
INTRODUCTION
SYMPTOMS WERE NUMEROUS
Apart from collapsing financial markets there were rising unemployment, deeper
inequalities, a shrinking middle class, extreme indebtedness, and inability of governments
to force through reforms
The second part focuses on analysis of areas, which are crucial for reforms and the
emergence of a new, less risky and more responsible art of capitalism
SUSTAINABLE
STABILITY
from
SUSTAINABILI
TY
STABILITY
STABILITY
French Economist Jean Charles Leonard de Sismondi in 1819 and also the
works of Joseph Schumpeter analysis of its overall pattern: “It says that
THE CHALLENGE
The idea of an anti-cyclical policy sounds very modern, but is in fact very
old. Tomas Sedlacek, the Czech author of an influential book on the history
of economics, reminds us in this context of the bible parable about
pharaoh's bad dream.
STABILITY
STABILITY
WHAT IS SUSTAINABILITY?
CHALLENGES IN SUSTAINABILITY
CHALLENGES IN SUSTAINABILITY
This is why the branch devoted more attention to the problem of what
In 1968 Garret Hardin wrote his famous work ‘Tragedy of the commons’, in
“Black Swan”
o Expression introduced by Nassim Nocolas Taleb
o an unexpected event with dramatic consequences
Convergence
o coming together of distinct and separate factors or phenomenon such as
technologies
Pluralism of Development
Models
How Convergence Failed
Expansion of the globalization process + economic reforms in the USA, UK and Latin
America + collapse of communism combined with shock therapies of state led
economies = ‘end of history” atmosphere
Solution : economic policies on liberal agenda
Example: Economic Index of Freedom by The Heritage Foundation which can be
measured through its:
Pluralism of Development
Models
How Convergence Failed
DRAWBACKS
1. Increased exposition of the world economic systems on crisis and
contagion effects
• IMF & World Bank were conditioning their aid measure even deeper
deregulation of crisis-ridden economies
2. Efficiency
a. Short-termism
b. High volatility
c. Inability to deal with externalities
d. Social inequalities
Pluralism of Development
Models
How Convergence Failed
DRAWBACKS
Social Justice
o a market economy endangers its political sustainability by making
alternatives more attractive
Pluralism of Development
Models
How Convergence Failed
Capitalism
o An economic system in which capital goods are owned by private
individuals or businesses
Pluralism of Development
Models
Varieties of Capitalism
Basic assumptions
• Firms as the most important actors for welfare creation of national economies
How?
• Need access to resources, to mention the most fundamental ones (capital, labor
and skills)
THEORETICAL METHODS
1. Liberal Market Economy
(USA, Canada, UK, Austria and other English speaking countries)
• dynamic access to resources
• labor market is shaped by dynamic relations
• individuals and potential workers invest their knowledge and then sell it to
firms
Pluralism of Development
Models
Varieties of Capitalism
THEORETICAL METHODS
2. Coordinated Market Economy
• transactions are more stable
• long term oriented
• capital is provided by banks
• labor market is characterized by long term contracts and low differences in wage
levels
• they do not compete with low costs, but rather high quality
• Germany, Japan, Scandinavian economies, Netherlands, Austria, Switzerland
Pluralism of Development
Models
Varieties of Capitalism
ARGUMENTS
LMes and CMEs are in the world like pedal in bicycles
At t h e b e g i n n i n g o f t h e i n n o v a t i o n c y c l e . .
LME’s drive the global system and CMEs lag behind LME’s offer higher salaries calm
wave of innovation CMEs make their own job by integrating the latest technologies
LMEs shift resources to new experiments and prepare a new wave of innovations
Pluralism of Development
Models
Varieties of Capitalism
ARGUMENTS
A dinner prepared at home by family members and friends is worse for the economy
than a dinner ordered in a restaurant. If there is no transaction, there is simply no
growth measured.
Approaches to Growth
-The more products we are able to deliver, the better for everybody
-Cost of current growth considered as GDP rising can be rolled over to less visible long
term
Approaches to Growth
More Growth
More Growth
There is much more acceptance for regulation and the government intervening,
but the logic of growth remains the same:
the more goods, the better
Approaches to Growth
Amended Growth
Amended Growth
Progress Index
Approaches to Growth
End of Growth
Secondly,
we are moving towards a new economic model.
Thirdly,
the pluralism of institutional arrangements which can create unique competitive
profiles of national economies and a more stable global system
Lastly,
a corrected goal and measure of development