Economic Growth, Environmental Scarcity, and Conflict

Economic Growth, Environmental Scarcity, and Conºict • Rafael Reuveny

RafaelEconomic Reuveny Growth, Environmental Scarcity, and Conºict

Introduction The global population is expected to reach nine billion by 2050, intensifying pressures on renewable and nonrenewable natural resources and degrading the environment. I use the term “environmental scarcity” to denote these developments. Environmental scarcity is currently more prevalent in less developed countries (LDCs) than in developed countries (DCs). Many authors argue that environmental scarcity increasingly promotes armed conºicts in LDCs. Such conºicts are referred to here as “environmental conºicts.”1 The environmental scarcity literature has focused on the environmental causes of conºict, but has devoted relatively little attention to the issue of conºict prevention.2 This issue is central to my paper. My premise is that environmental scarcity promotes armed conºict in LDCs. However, this premise is controversial. Reviewing the controversy, I ªrst demonstrate that many scholars and policy-makers support my premise. The following section shows that the effects of armed conºicts on LDCs are devastat- ing. Many scholars and policy-makers also believe that economic growth is the ultimate solution to environmental scarcity and conºict. It is argued that as LDCs’ income per capita rises to the level of that of DCs, their environmental scarcity and poverty will decline, preventing conºict and building peace. My goal is to evaluate the implications of this view for environmental conºict. The environment-conºict nexus is complex. To gain clarity, I develop a stylized mathematical model describing a society that exhibits conºict over resources. I use the model as a lens through which to observe empirical data and as a tool to evaluate scenarios heuristically. The picture conveyed by the data indicates an increasing tendency toward global income inequality, environmental scarcity, and environmental conºict in LDCs. The remainder of this paper illustrates that the economic growth solution to environmental conºict prevention will probably fail because the biosphere

1. Citations for views stated in the introduction are provided later. 2. Diehl 1998.

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would not be able to support a DC-level standard of living for all nations, at least not at the current state of technology. The growth approach is likely to bring the system ever closer to its ecological limits. The resulting intensiªcation of pressures on the ecosystem is likely to induce more, not less, environmental conºict. As long as the system’s limits are not reached, economic growth is via- ble. However, without technological “magic,” as the system gets ever closer to the limits, it may collapse. Whether such magic is feasible currently is not known. This paper is not against economic growth in LDCs. The morality of growth in LDCs is undisputed. Growth in LDCs also is important based on prac- tical grounds. Historically, highly skewed national distributions of income have been politically unstable.3 Should the DC-LDC income gap continue to widen, global political instability could rise. Thus, we are facing a dilemma. Growth in LDCs is important, but may not be ecologically sustainable at the global level. Nevertheless, I believe that economic growth in LDCs is feasible, provided that it is compensated by economic contraction in DCs.4 This approach obviously faces considerable obstacles and will probably be rejected by DCs. It might be initiated eventually in response to some global ecological-social-political crisis.

Environmental Scarcity and Conºict The World Commission on Environment and Development (WCED) observes that “nations have often fought to assert or resist control over war materials, energy supplies, land, river basins, sea passages and other key environmental resources.”5 This argument can be traced back to Malthus6 who expected that population growth eventually would lead to resource depletion, economic decline and conºict over resources. Wright7 and his contemporaries also studied the role of resources in conºict. However, during the Cold War these issues were not at the forefront of research. In the 1990s, a growing number of scholars returned to the Malthusian story. By now, this literature has grown so much that it is not possible to fully review it within a few pages. I will focus on representative studies. Environmental scarcity can cause conºict through interrelated social, economic, and political channels.8 A decline in the quality or quantity of natural resources may lead to economic decline. Another channel involves contests over scarce resources, particularly when they do not have readily available substitutes. Environmental scarcity may erode the people’s support of institutions,

3. For example, skewed income distributions have promoted the French and the Russian Revolu- tions (Kennedy 1993) as well as social strife in many LDCs (Nafziger 1997). 4. Economic contraction involves reducing real output per capita. 5. World Commission on Environment and Development 1987, 290. 6. Malthus 1798. 7. Wright 1965. 8. This discussion is based on Myers 1993; Homer-Dixon 1999; Lietzmann and Vest 1999; Baechler 1999; Gleditsch 1998 and 2001; and Maxwell and Reuveny 2000.

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leading to internal turmoil, which can, in turn, weaken the economy and promote more conºict. As environmental scarcity rises, groups may be dislocated or migrate. Immigrants and nationals may clash over diverse issues, including the resources of the land. Finally, we can place the above channels within a setup that is already politically unstable, where environmental scarcity exacer- bates tensions. The Malthusian paradigm is controversial. Scholars have criticized Mal- thus for ignoring the role of markets, trade, institutions and human ingenuity in alleviating environmental constraints. For example, as resources are depleted, their prices rise, inducing a move to substitutes. Scarcity also could lead to cooperation (e.g., curbing usage of scarce resources, halting environmental degradation).9 Simon10 argues that population is the ultimate resource, not the root of the problem. A large population implies more human ingenuity and economic growth, alleviating resource scarcity.11 Others suggest that the scope of environmental problems is greatly exaggerated.12 Finally, it is argued that environmental scarcity is not relevant to conºict and is not crucial to US national security.13 Diehl14 notes that much of the controversy is political in nature. Be that as it may, the literature provides a strong impression that environmental scarcities cause conºict in LDCs.15 This is also the view of many policy-makers.16 This is not to say that environmental scarcity is the only cause of conºict in LDCs or is present in all conºicts. It also is possible that some conºicts in LDCs are associated with resource abundance.17 However, environmental scarcity is visible in many LDCs, and it may well increase in the future for two reasons. First, LDC populations are expected to grow signiªcantly in the coming decades, increasing pressure on the environment.18 Second, LDCs are likely to suffer more from

9. See, for example, North 1995; Moore 1995; Simon 1996; Deudney 1999; and Conca 2001. 10. Simon 1989 and 1996. 11. Similarly, Boserup 1981 emphasizes the beneªts of population density in industrialization and innovation. But Dasgupta 1995 argues that the ideas of Simon and Boserup are not applicable to LDCs. 12. Bailey 1993, and Adler 1998 argue that global warming is not a threat. Simon and Wildavsky 1995 and Beckerman 1995 argue that the loss of biodiversity is not a problem, and Simon 1996 argues that resources are not scarce. Lomborg 2001 makes similar arguments. 13. Levy 1995. 14. Diehl 1998. 15. Gleditsch 1998; Payne 1998; and Midlarsky 1998. 16. For example, the US Department of Defense has a Deputy Undersecretary for Environmental Security. NATO’s Science Committee (Gleditsch 1998), NATO’s Committee on the Challenges of Modern Society (Lietzmann and Vest 1999), former US Vice President Gore (Gore 1992), and Germany’s Environment Minister (Trittin 2000) argue that environmental scarcity causes conºict in LDCs. US Senator Nunn seeks to put the environment on the US security agenda (Butts 1999). The administrator of the US Agency for International Development says that in the 1990s environmental scarcity has become the largest threat to US security (Sherbinin 1995). The Chairman of the Global Environment Facility says the world faces the prospect of wars over scarce resources (Payne 1998). 17. Collier 2000 argues that resource abundance can lead to conºict in LDCs by ªnancing the war effort, but Collier and Hoefºer 1998 ªnd that resource plenty reduces the likelihood of conºict. 18. Bongaarts and Bulatao 2000.

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climate change than DCs since they are less able to adapt to it, and the damage could be substantial.19 Thus, environmental conºict could become even more acute in the future.20

The Effects of Armed Conºict on LDCs The literature on environmental conºict typically does not study the effect of conºict.21 This reverse causality is important to my paper. There is a relatively small body of literature (focused on the US, the UK and a few other DCs) that studies the effects of wars. Studies argue that war kills people, destroys property, reduces investments, promotes inºation, and raises state expenditures, reducing growth.22 Wars can reduce the level of democracy since they tend to centralize political power.23 When wars are not popular, the state can become oppressive.24 Another argument is that states facing threats maintain larger armies, reducing funds for democratic consolidation.25 Wars can also intensify cleavages26 and trigger revolts.27 On the positive side, war can stimulate growth by mobilizing the economy,28 disrupting rent seeking,29 and motivating the losers to develop an edge over the winners.30 It also is argued that wars can promote social and political reforms,31 reduce income inequality,32 and expand welfare services.33 Some authors argue that the conºict-prone European political environment provided incentives to states to excel economically, facilitating the rise of the West.34 Since 1945, most of the wars have been fought in LDCs.35 Wall and Win- ter, Mathur, and Derez36 reason that the potentially positive social effects of war on the UK and the US are not relevant for LDCs. First, the UK and the US suffered less in wars. The effects of wars on countries that suffered more (e.g., the former USSR) were not as positive. Second, the European wars have been in-

19. Intergovernmental Panel on Climate Change 2001. 20. For a similar view, see Gore 1992; Lodgaard 1992; Kennedy 1993; Lonergan 1997; Litvin 1998; and Klare 2001. 21. Gleditsch 1998 and 2001. 22. Kuznets 1971; and Mott 1997. 23. de Tocqueville 1835. 24. Laswell 1977; and Midlarsky 1995. 25. Layne 1994. 26. Midlarsky 1995. 27. Bueno de Mesquita and Lalman 1992. 28. Thompson 1993. 29. Olson 1982. 30. Kugler and Arbetman 1989. 31. Kasza 1996. 32. Stohl 1976. 33. Winter 1986. 34. Parente and Prescott 2000. 35. Singer and Clemens 2000. During the 1990s, for example, there were 39 wars in LDCs, in which more than four million people died, and 35 million became refugees (World Bank News Re- lease, 2000/419/S). 36. Wall and Winter 1988; Mathur 2001; and Derez 2000.

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terstate wars, whereas many of the wars in LDCs are intrastate wars. While interstate wars can unite people, intrastate wars are disintegrative. Finally, the US and the UK had strong traditions of pluralistic politics, allowing the underprivi- leged to translate their claims to actions. LDCs typically do not have such traditions. In fact, the effects of wars on LDCs are quite adverse. The World Develop- ment Report (WDR), Collier, and Mathur37 conclude that wars in LDCs devastate the economy, raise poverty, diminish welfare expenditures, destroy infra- structures, raise the death rate, disrupt institutions, cause capital ºight, and inºict social wounds. Dasgupta, Derez, Lietzmann and Vest, Singer and Keating, and Mathur38 observe that wars in LDCs also create refugees, promote social dis- integration, disrupt family life, and precipitate political repression. Wars devastate the environment.39 Dasgupta40 observes that wars in LDCs erode social norms of protecting the commons from overexploitation and promote resource appropriation by the warring parties. In addition to outright combat, preparation for war (e.g., weapon testing, training) can be quite de- structive.41 At the same time, wars can also reduce environmental degradation by suppressing ordinary economic activity. For example, industrial emissions may decline due to plant destruction.42 However, as noted by McNeill,43 these effects are temporary. Overall, it is well established that war destroys the environment.44 This havoc can trap countries in a vicious cycle of poverty, environmental degradation and violence.45

A Stylized Model The previous sections illustrate that the interactions among the environment, society, and war are complex. We could gain clarity by modeling these interactions mathematically. While such a model will be complex, it can assist in con- ceptualizing assumptions and competing effects. Gleditsch’s46 recommendation, to model environmental conºict along the lines employed in macroeconomics, provides a useful starting point. However, the scope of macroeconomic models is typically narrow, ignoring forces that are not studied. The narrow

37. World Bank 2001b; Collier 2000; and Mathur 2001. 38. Dasgupta 1995; Derez 2000; Lietzmann and Vest 1999; Singer and Keating 1999; and Mathur 2001. 39. Westing 1990; Thompson 1995; Lietzmann and Vest 1999; Mathur 2001; McNeill 2001; and Gleditsch 2001. For example, wars have destroyed forests, including the British conºict in Ma- laya, World War II, and the Vietnam War (Thompson 1995; and McNeill 2001). On the environmental havoc inºicted by the 1991 Gulf War, see Rokke 1991. 40. Dasgupta 1995. 41. Singer and Keating 1999; and McNeill 2001. 42. Turner et al. 1990. 43. McNeill 2001. 44. Gleditsch 1998. 45. Dasgupta 1995; and Gleditsch 2001. 46. Gleditsch 1998.

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scope simpliªes the mathematics but may omit important parts of the big picture. I believe that this statement applies to the neoclassical macroeconomic framework used in the study of economic growth in macroeconomics. The model presented here has a neoclassical structure, but it is consider- ably larger in scope, in that it includes also the environment and environmental conºict. The equations integrate insights from the bodies of literature on economic growth and technological progress, sustainable development, the quality of life, and environmental conºict.47 I focus on an economy that exhibits environmental conºict.48 As in Polachek, Bueno de Mesquita and Lalman, and Hirshleifer,49 I assume that actors consider conºict to be one of several activities utilized in order to achieve their objective. The level of conºict is modeled as a continuum of intensities. Like all models, this one is a simpliªcation of reality. For example, environmental conºict is more prevalent in LDCs than in DCs, but the model does not capture this difference. That said, my goal is not necessarily to capture every detail of reality, but rather to provide a stylized, yet systematic, picture of important processes. The model includes three types of variables. Stock variables indi- cate levels in existence at some point in time. Flow variables are measured per period of time. Choice variables are chosen by actors in order to meet their objective. Table 1 deªnes the symbols used.50 I assume that the economy includes similar actors, as it would in the neoclassical economic growth framework. The implications of this assumption are problematic and will be discussed later. Each actor is both a consumer and a producer. Production generates output, pollution and waste. Actors choose how much output to consume or to use to replenish stocks. Technology and human capital advance over time, augmenting production, resources, institutions and environmental quality. As the preceding section indicates, conºict adversely af- fects the environment, the economy and society. I assume that actors are rational and act to maximize their utility (U). In the neoclassical framework, U rises with consumption and does not depend on any other variable.51 But utility also may depend on other variables.52 In Equa- tion (1), U rises with all its arguments. Consumption ºow per capita (c) is an aggregate of goods and services. Human capital stock per capita (h) includes knowledge and experience. The stock of environment quality per capita (e) in-

47. Contemporary macroeconomic texts typically ignore the environment or discuss it in passing. As far as I can see, conºict is not discussed (for example, Dornbusch, et al. 1998; Jones 1998; Aghion and Hewitt 1998; and Romer 2001). On sustainable development, see Rao 2000. On the quality of life, see Diener and Suh 2000. 48. The causes of wars are numerous. For a recent review of the literature, see Van Evera 1999. 49. Polachek 1992; Bueno de Mesquita and Lalman 1992; and Hirshleifer 1995. 50. The notations are as follows: yϭf(x) means y depends on x, in time t; dz/dt (derivative) denotes the change of z over time. Lower-case symbols denote per-capita values and upper-case symbols denote societal aggregates. The model adds environmental conºict to, and modiªes, the one in Krutilla and Reuveny 2000. 51. Aghion and Hewitt 1998. 52. World Bank 1992; and Diener and Suh 2000.

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Table 1 The Model’s Variables

Stock Variables Flow Variables Actors’ Choice Variables

Symbol Deªnition Symbol Deªnition Symbol Deªnition

H, h Human capital U Utility LW Effort allocated to labor

E, e Environmental Q, q Output (or income) LH Effort allocated to quality W Waste and pollution accumulation of human capital S, s Institutions V,v Environmental R, r Natural conºict LC Effort allocated to conºict resources D Discovery of natural K Physical capital resources C,c Consumption T Technology CR Natural resources and innovation extraction P Population IK Investment in physical capital

IT Investment in technology

IP Investment in population planning

IH Investment in human capital

IR Investment in maintain- ing resources

ID Investment in discovering resources

Ic Investment in conºict Note: Upper case letters denote societal aggregates, and lower case letters denote per capita values.

cludes features such as clean air and water. The stock of institutions per capita (s) is an aggregate of features such as property rights, rule of law, and democracy. The stock of resources per capita (r) is an aggregate of renewable and nonrenewable resources. The actors in the model consider conºict to be a rational activity. I model this notion by assuming that conºict adds to utility, where v is the level of conºict per capita. (1) Uϭ f (c, h, e, s, r, v) Actors allocate their total effort (L) over acquiring human capital (LH), work (LW), and engaging in conºict (LC). The production ºow of

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output (Q) rises with LW, resource extraction (CR), the stocks of physical capital (K), technology (T), human capital (H), institutions (S) and the ºow of waste and pollution (W), and falls with the level of conºict (V).53 ϭ (2) Q f (LW, K, T, H, CR, S, W, V) Output can be consumed or invested. IH is investment in human capital, IK in physical capital, IR in improving resources, IP in population planning, IT in technology, IC in conºict activity, and ID is investment in discovery of resources. The stock of physical capital (K) rises with investment in physical capital (IK) and falls with conºict (V). ϭ (3) dK/dt f (IK, V) The technology stock (T) rises with investments in technology (IT) and the stocks of human capital (H), institutions (S), and technology itself (T). T also falls with conºict (V).54 ϭ (4) dT/dt f (IT, H, T, S, V) Population declines with conºict (V) and rises with the stocks of environmental quality (E) and population itself (P). The effect of income per capita (q) on population is assumed to follow the theory of demographic transition.55 Up to some q, the population growth rate rises with q. Above that level, it declines with q. The effect of investments in population planning (IP) on population could be negative (e.g., promoting contraception) or positive (e.g., promoting large families). ϭ (5) dP/dt f (V, E, P, q, IP) The stock of human capital rises with investment in human capital (IH), the stocks of human capital (H) and institutions (S), and the effort to acquire human capital (LH), and falls with conºict (V) (e.g., educational infrastructure is destroyed). ϭ (6) dH/dt f (IH, H, S, LH, V) The stock of institutions (S) rises with the stock of S itself, human capital (H) and technology (T), and falls with conºict (V). Environmental scarcity (a fall in R and E and a rise in P) also disrupts the creation of institutions.56 (7) dS/dt ϭ f (S, H, T, V, E, P, R) The stock of natural resources (R) rises with its intrinsic growth rate (η) (for renewable resources) and resource discoveries (D), and falls with η resource extraction (CR). falls with conºict (V) and rises with investments to maintain renewable resources (IR), the stock of technology (T) (e.g., Green Revolution) and environmental quality (E). η also may de-

53. Q rises with W since reducing W requires diverting inputs from production to pollution abate- ment. Income equals the value of Q. 54. Barbier 1999; Homer-Dixon 1999; and Lietzmann and Vest 1999. 55. Nafziger 1997. 56. Barbier 1999; and Lietzmann and Vest 1999.

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pend on R. Resource discovery (D) rises with investments in discovery (ID) and T.57 ϭ η ϩ − (8) dR/dt (V, R, IR, T, E) D (ID, T) CR The stock of environmental quality (E) rises with its intrinsic growth rate (µ) (e.g., pollution absorption capacity) and falls with waste and pollution (W). µ falls with conºict (V), rises with E, and may rise or fall with technology (T) (e.g., clean versus dirty energy). The level of waste and pollution (W) rises with consumption (C) and production (Q) and falls with the stock of institutions (S) (e.g., monitoring pollution). (9) dE/dt ϭ µ (E, T, V) − W (Q, C, S) Conºict rises with the effort actors allocate to it (LC) and with investments in conºict activity (IC). Reºecting my premise that environmental scarcity promotes conºict, conºict also rises with population (P), and falls when the stocks of environmental quality (E) and natural resources (R) rise. Conºict also falls when the stock of institutions (S) rises (for example, the rule of law can promote order, and democracy may resolve social tensions). Finally, conºict depends on income per capita (q). One of my goals is to evaluate the nature of this relationship. ϭ (10) V f (LC, P, E, S, R, q) The choice variables in the model are the effort allocations to work (LW), conºict (LC) and acquiring human capital (LH), consumption (c), resource extraction (CR), and the investments (IK,IH,IT,IR,IC,IN,ID). As in the neoclassical growth framework, actors maximize the sum of their utilities over time, where future utilities are discounted and ρ is the discount rate.

Stated∞ formally, actors solve a dynamic optimization problem: ⋅ −ρt (11) Max∫ ft (,,,,,,) c h e s r v e dt t=1 Subject to: Equations 2-10 as constraints, = ϩ ϩ L LW LH LC, ϩ ϩ⌱ ϩ ϩ⌱ ϩ ϩ ϩ Q = C IK ⌻ IP ⌯ IR IC ID

by choosing LW, LH, LC, CR, IK, IT, IP, IH, IC, IR, ID. Expression (11) deªnes a complex dynamic system. Some readers may argue that further research could reduce this complexity. I believe that this is not likely to be the case. As noted by Lietzmann and Vest, and Schwartz et al.,58 the problem of environmental conºict is inherently complex, multi-causal, dynamic, and has many feedback loops. My model’s complexity reºects broadly

57. Some resources exhibit logistic growth: η rises with R up to some R, and then falls as R approaches its carrying capacity. For nonrenewable resources, η ϭ 0. Also, D has obvious limits. 58. Lietzmann and Vest 1999; and Schwartz et al. 2001.

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what we know about the relevant processes in economics, ecology and the literature on environmental conºict. To my knowledge, Equations (1)–(11) consti- tute the ªrst attempt in the literature on environmental conºict to capture formally the essence of this complexity. We could now proceed in one of three directions. First, one could attempt to solve the dynamic optimization in (11). Given the model’s size, this is intrac- table. One could introduce simplifying assumptions into the model, but this amounts to throwing the baby out with the bath-water. Second, one could cali- brate the model and conduct numerical simulations, but many calibrations could be chosen. The number of permutations is large and the trajectories ob- tained could change across permutations, because the system is highly nonlinear. In any case, this very large effort is deferred for future research. Third, one could inspect empirical data, using the model as a heuristic lens that deªnes which variables to observe and how to understand their dynamics. The data will not be used to test the model as in statistical analysis, but rather they are used to learn more about the net effects in the model. This approach is taken next.

Empirical Observations This section describes broadly the trajectories taken by the model’s variables in the post-1950 era, focusing on output (Q), consumption (C), technology (T), institutions (S), human capital (H), population (P), natural resources (R), environmental quality (E), waste and pollution (W), and environmental conºict (V).59 The average real gross domestic product (GDP) per capita (q) of Western Europe, the US, Canada, Australia and New Zealand grew from $7424 in 1950 to $25,302 in 1999 (expressed in 1998 dollars). The ªgures for Africa in 1950 and 1999 were $975 and $1610, for Asia (including Japan), $880 and $4496, and for Latin America, $3055 and $6512, respectively.60 In the late 1990s, 35% of the world’s population lived in low-income nations ($350 GDP per capita), 49% in middle-income nations ($1890 GDP per capita), and 16% lived in high-income nations ($25,890 GDP per capita).61 In 1997, the 20% of the population living in the richest nations had 74 times the income of the 20% living in the poorest, whereas, in 1960, the richest had only 30 times the income of the poorest. Today, DCs spend 86% of world expenditures on total consumption (C). They consume 58% of the world’s energy, 65% of its electricity, 46% of its meat, and 84% of its paper, and use 87% of its cars and 74% of its telephones. In each of these areas, the share of the poorest ªfth of the world’s population is smaller

59. The economic and environmental data presented here and in the discussion later in the paper extend my work in Reuveny 2001, introducing environmental conºict and the model into the analysis. 60. Brown et al. 2000, 71; and Worldwatch Database Disk 2000. 61. World Bank 1999, 14.

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than 10%. Since the 1970s, globalization has been proceeding at a fast but un- equal speed. The richest ªfth enjoys 82% of the expanding trade and 68% of foreign direct investments. The poorest ªfth accounts for around 1% in both categories. In 1998, about 840 million people were malnourished, and 1.3 billion lived on incomes of less than $1 per day.62 The stocks of technology (T) and knowledge (H) have grown. As detailed later, there have also been forces slowing down progress (the effect of which has been more pronounced in LDCs). Social and political institutions (S) changed as well. There has been a movement toward liberalized markets. Multilateral agreements over such issues as trade, intellectual property rights, and global warming have been negotiated, but the latter agreement has not been implemented. There also has been a widespread adoption of democracy as the pre- ferred regime.63 Global population (P) has more than doubled since 1950, reaching 6 billion in late 1999. The population growth rate was higher in LDCs than in DCs. In 1999, 30% of the addition to global population occurred on the Indian sub- continent, 25% in Africa, and most of the rest was in China and other LDCs. While the growth rate of the global population declined from 2.3% in 1963 to 1.3% in 1999, world population increased by 77 million people in 1999. Yearly additions to the global population are expected to remain high for at least 20 years, declining to 30 million by 2050.64 The 20% of the global population in DCs account for 50% of the rise in resource (R) use since 1950. Since 1950, energy consumption has been growing at a rate of 2 to 4% per year. In 1996, energy use per capita in high-income countries was 5259 kilograms of oil equivalent, in middle-income countries, 1305 kilograms, and in low-income countries, 461 kilograms. There were larger gaps between speciªc rich and poor nations: for example, US energy consumption per capita in 1996 was 43 times that of Yemen. In the late 1990s, more than 80% of the world’s energy came from fossil fuels.65 Grains provide more than 50% of the protein in the human diet.66 World grain production grew from 631 million tons in 1950 to 1879 million tons in 1997, and then fell to 1855 in 1999. Per capita grain production peaked at 342 kilograms in 1984, falling to 309 in 1999. Per capita grain inventories peaked in 1987 at 104 days’ use, falling to 62 days’ use in 1999.67 Fish is the main source of animal protein for over 15% of the global population.68 Per capita ªsh harvests

62. UNDP 1999, 28, 31, 36; and 1998, 50. The per capita terms reveal skewer patterns. See UNDP 1998, Cover; Litvin 1998; and World Resources Institute 1999, 154. 63. World Bank 1997, 1999; and UNDP 1998, 1999. 64. Brown et al. 2000, 98. An event that could increase population is China’s probable abandon- ment of the one child per family policy (Levy 2000). 65. UNDP 1998, 4; World Bank 1999, 144–147; Brown et al. 2000, 53. 66. Dyson 1996. 67. Brown et al. 2000, 34, 156; Brown, Renner, and Halweil 1999, 38. 68. Grainger 2000.

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peaked in 1988 at 17.4 kilograms and declined to 15 kilograms in 1998. Today, 60% of the world’s oceanic ªsheries are ªshed at capacity.69 Today, a third of the world’s original forests have disappeared, and the re- maining forests have lost some of their ecological integrity. Between 1960 and 1990, 20% of the world’s forests were cleared. In 1997–1998, coverage was 60% of 1970 levels, and 39% of world forests were under threat of clearing.70 Fresh water scarcity also has intensiªed. From 1900 to 2000, water extraction increased tenfold. Water availability today is 60% of the 1970 level. In the late 1990s, 5% of the world’s population was subject to water stress (with less than 1700 cubic meters per capita per year), and 3% to water scarcity (with less than 1000 cubic meters). 1.3 billion people in LDCs did not have access to clean water. Many of the world’s groundwater aquifers, storing 97% of the unfrozen fresh water, were extracted faster than their rate of replenishment. Today, many countries including India, China, and the US are running large water deªcits.71 It is estimated that by 2050, available fresh water per capita will be one-fourth of what it was in 1950.72 A threshold of .07 hectares of grain area per capita (a proxy for crop land) is typically used to deªne land scarcity, below which countries become grain im- porters. Per capita global grain area is now approaching this threshold, falling from 0.23 hectares in 1950 to 0.11 hectares in 1999. By 2020, it is estimated that 70% of Asia’s population will depend on imports for at least 20% of their grain.73 In other studies, cropland is scarce when more than 70% of the arable land is cultivated. In Asia, 82% of the arable land is cultivated. In Latin America and Africa, 70% of the arable land is cultivated. In other areas (e.g., the Sahel, Southeast Africa, Central America, Andean Highlands), the ratios are higher. By 2050, it is estimated that at least 2 billion people will face land scarcity and extensive land degradation.74 Global environmental quality (E) has been declining since 1950. There have been diminished biodiversity, ozone depletion, and a rise in pollution, waste, and weather disasters.75 Global average temperatures rose from 13.84°C in 1950, to 14.58°C in 1998. Weather disaster damages expressed in real terms

69. Brown et al. 2000, 40, 156. Fish harvest projections for 2010 are 107–144 million tons. The higher number implies the same consumption per capita as in 1998. The lower number implies consumption lower by a third (relative to 1998). See Food and Agriculture Organization (FAO) 1997, 2000. 70. World Resources Institute 1999, 186–187; UNDP 1998, 74–75; UNDP 1999, 43. 71. UNDP 1998, 4; UNDP 1999, 28, 43; World Bank 1999, 118–119; and Brown et al. 2000, 123– 125. 72. Gardner-Outlaw and Engelman 1997; and Brown et al. 1999. World Bank 1999, 118–119, predicts that 42% of the global population will exhibit water stress in 2050 and 17% will exhibit water scarcity. See also World Resources Institute 1999, 189. 73. Brown et al. 2000, 44–45. Pakistan, Nigeria and Ethiopia are expected to lose 55–63% of their crop lands by 2050, arriving at a third of what they had in 1950 (Brown et al. 1999, 62–65.) 74. World Resources Institute 1997, 238; Homer-Dixon 1999, 63. For a forecast for 2050, see UNDP 1998, 80. 75. World Resources Institute 1999; World Disaster Report 1999; and Intergovernmental Panel on Climate Change 2001.

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rose from $2.8 billion in 1980 to $67.1 billion in 1999—a trend that is expected to continue.76 The 20% of the world’s population in DCs have generated more than 53% of the world’s carbon dioxide emissions since 1950. An individ- ual in a DC now generates more pollution and waste (W) than 30 to 50 individuals in LDCs.77 These data suggest growing environmental scarcity in the post-1950 era. Several studies show that the scarcity has promoted environmental conºicts in LDCs.78 For example, land scarcity caused population migration from El Salva- dor to Honduras. The resulting competition over land between immigrants and nationals led to a war in 1969.79 Social strife in the Philippines80 and Haiti81 is linked to deforestation and land degradation. Subsistence crisis led to the Sendero Luminoso rebellion in Peru82 and fomented civil wars in Africa.83 Environmental scarcity has, at times, exacerbated ethnic conºict. Exam- ples include conºicts in South Africa,84 Borneo, New Guinea,85 Rwanda,86 Mex- ico,87 Bangladesh,88 and Nigeria.89 Since the mid-1980s, there also have been many poor squatters on ranches in Brazil.90 Declining ªsh stocks have caused strife between otherwise peaceful nations (for example, Canada and Spain, and Malaysia and Thailand).91 In the late 1990s, there was a considerable rise in illegal ªshing and sea piracy directed at ªshing boats, both taking place mostly in poor regions. In 2000, there were over 460 pirate attacks worldwide, 56% more than in 1999.92 Conºict over water also is frequently observed.93 Examples include the 1989 Mauritania- Senegal conºict, the ongoing Arab-Israeli conºict, the mid-1980s South Africa- Lesotho conºict, and the ongoing Syrian-Turkish conºict. In the 1990s, water shortages in China’s Ningxia province led to farmers’ raids on neighboring

76. Brown et al. 2000, 77. Kunkel et al. 1999 attribute the rise in damages to greater coastal line ex- posure. Bruce et al. 1999 attribute it to global warming. Intergovernmental Panel on Climate Change 2001 predicts a rise in climate change-driven weather disasters in the future, as well as other adverse impacts of climate change. 77. Per capita emissions in the US are 7 times the per capita emissions in China, and 31 times the emissions in Pakistan. See UNDP 1998, 4; and Engelman 1998. 78. The discussion is not meant to be exhaustive. For more examples, see Baechler 1998; and Myers 1993. 79. Durham 1979. 80. Hawes 1990. 81. Homer-Dixon 1999. 82. McClintock 1984. 83. Holst 1989. 84. Percival and Homer-Dixon 2001. 85. Hirshleifer 1995. 86. Renner 1996; Baechler 1998, 1999; Lietzmann and Vest 1999; and Brown et al. 1999. 87. Homer-Dixon 1999; and Brown et al. 1999. 88. Swain 1996. 89. The Economist 2001b. 90. For example, see The Economist 1996. 91. Litvin 1998. 92. United Nations Secretary General 1998; Spiess 1998; Fitzpatrick and Newton 1998; and The Economist 2001a. 93. Renner 1996; Baechler 1999; and Lonergan 2001.

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herders.94 Some observers argue that future wars will be fought increasingly over water.95 Turning to statistical studies, Choucri and North, and Tir and Diehl96 ªnd that population growth promotes interstate conºict. Hauge and Ellingsen97 ªnd that environmental scarcity in LDCs promote civil wars.98 Finally, since 1950, environmental conºicts also have occurred among DCs, but with lower intensity. Examples include the English-Icelandic Cod War, and the recent US- Canada ªshing conºicts. However, DCs have fought over resources in the past. Choucri and North99 argue that resource scarcity was one of the causes of World War I, and Westing100 lists 12 wars (some involving DCs) fought between 1914 and 1982 over resources.101

Economic Growth: The Conventional Wisdom We have seen that growth in global output (Q) and consumption (C) is associated with a highly skewed global distribution of income, growing population (P), declining environmental quality (E), depletion of resources (R), and environmental conºicts (V) in LDCs. These developments have not weakened the conventional belief in the desirability of economic growth. Attaining economic growth is the hallmark of macroeconomics and the “Washington Consensus” and is deemed important for both economic development and sustainable development.102 For example, the WCED report emphasizes that sustainable development “recognizes that the problems of poverty and underdevelopment cannot be solved unless we have new era of [economic] growth [in LDCs],”103 and the 1992 Earth Summit Declaration (signed by 178 countries) says: “States should cooperate to promote...[an] international economic system that would lead to economic growth and sustainable development in all countries.”104 The theoretical foundation of these statements is grounded in the neoclassical framework. Neoclassical economists argue that environmental scarcity is resolved by four forces. The ªrst force is demographic transition. For low per capita income

194. Pomfret 1998. 195. Serageldin 1995; Lonergan 1997; and Litvin 1998. 196. Choucri and North 1975; and Tir and Diehl 2001. 197. Hauge and Ellingsen 2001. 198. According to Huth 1996 and others, territory is the most prevalent issue in conºict, which agrees with the notion that land pressures cause conºict. 199. Choucri and North 1975. 100. Westing 1986. 101. The 1991 Gulf War also involved DCs. This war is said to have been about oil. 102. See Nafziger 1997; UNDP 1999; Rao 2000; Romer 2001; and World Bank 2001. The Washing- ton Consensus deªnes policies that guide major DCs, the World Bank, and the International Monetary Fund (Nafziger 1997). Economic growth is a rise in real income (or output) per capita. Economic development is an improvement in the standard of living. Sustainable development is one that meets current needs without compromising the ability of future genera- tions to meet their needs (World Commission on Environment and Development 1987). 103. World Commission on Environment and Development 1987, 40. 104. Earth Summit Declaration 1992, Section B.

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(q), nations’ birth and death rates are high, and population (P) is stable. As q rises, P rises. Above some q, fertility falls and P stabilizes.105 Two other forces postulate that when q is low, economic growth reduces E and raises energy intensity.106 Above some q, E rises with q and energy intensity falls with q.107 Fourth, human ingenuity and markets alleviate environmental pressures. As Julian Simon puts it, “technology exists now to produce in virtually inexhaust- ible quantities just about all the products made by nature ...toanever-growing population for the next 7 billion years.”108 Similarly, Dornbusch et al.109 write that concerns about resource constraints are more appropriate for “a course in astrophysics, or perhaps theology, than for a course in economics . . . [since] technical progress permits us to produce more using fewer resources.” As resources become scarce, their prices rise, inducing a shift to substitutes.110 The belief that economic growth prevents conºict also is widely held. Economists Rostow and Kuznets111 argue that the gains from growth (that can be lost in war) provide incentives to settle disputes peacefully. Economic growth also may “forestall what might otherwise prove to be unbearable social tension.”11 2 Simon11 3 argues that economic growth makes conºict over natural resources obsolete. Dasgupta11 4 observes that LDCs depend on the environment for their livelihoods. Facing environmental degradation, more hands are needed to generate output and more children are produced, intensifying the degradation and leading to conºict over resources. Breaking the vicious cycle requires increases in income per capita. Observing that environmental scarcity promotes conºict in LDCs, historian Kennedy argues that alleviating the con- ºict requires economic growth because a “decent standard of living provides foundation for much else that groups and individuals deem important.”11 5 Ac- cording to political scientist Singer,11 6 poverty promotes wars in LDCs, and economic development will reduce the likelihood of conºict.11 7 In the literature on environmental conºict, Gleditsch11 8 summarizes that economic growth restrains environmental conºict because richer people stand to lose more from war, rich nations trade more and trade promotes peace, and environmental scarcity declines with economic development. The importance of economic growth in environmental conºict prevention also is noted by Mid- larsky, Renner and Deudney, and is implied by Homer-Dixon, and Barbier.11 9

105. Nafziger 1997. 106. Energy intensity is the amount of energy (R) required to produce a unit of output (Q). 107. Hanley et al. 1997. 108. See Bartlett 1996, 342. 109. Dornbusch et al. 1998, 74–75. 110. See also Moore 1995; North 1995; Simon 1996; and Romer 2001. 111. Rostow 1971; and Kuznets 1971. 112. Nafziger 1997, 9. For a similar view, see Collier 2001. 113. Simon 1989. 114. Dasgupta 1995. 115. Kennedy 1993, 346. 116. Singer 2001. 117. Henderson and Singer 2000. 118. Gleditsch 2001. 119. Midlarsky 1998; Renner 1999; Deudney 1999; Homer-Dixon 1999; and Barbier 1999.

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Among policy makers, the Earth Summit Declaration (1992) says that peace and economic development must go together, and a World Bank research team emphasizes the importance of economic growth in preventing conºicts and sustaining peace.120 The position of the US Department of Defense is that “poverty is the chief cause of political instability,”121 and this also is the position of NATO’s Committee on the Challenges of Modern Society in its report on environmental conºict.122 Finally, former US Vice President Gore123 believes that economic growth is crucial in preventing conºict over natural resources.

Back-of-the-Envelope Calculations and Technological Progress Let us assume that economic growth is the ultimate answer to the current environmental conºict observed in LDCs. If so, can the standard of living in LDCs grow to the level of DCs, and can both levels continue to grow forever? One way to evaluate these issues is to ªrst review a set of back-of-the-envelope calculations performed for the current state of technology, and then consider the possible effects of technological progress. Pimentel et al.124 show that to consume at the level of the US, six billion people would require 7.8 billion hectares of forest, and nine billion people would require 11.7 billion hectares. Wackernagel and Rees125 show that to adopt the US diet, six billion people would require 6–12 billion hectares of land, depending on the particular scenario, and nine billion would require 9–18 billion hectares. These requirements cannot be met, as the total forest area of Earth is 3.5 billion hectares and arable land area is 8.8 billion. Further developing these ideas, Wackernagel et al.126 show that in 1997, the world’s footprint was 2.8 hectares per capita, while the world’s available bio-capacity was 2.1 hectares per capita.127 These numbers imply unsustainable global depletion of natural stocks. The US footprint in 1997 was 10.3 hectares per capita, which is larger than the world’s bio-capacity per capita.128 Thus, it is impossible for all nations to attain the US standard of living. Pimentel and Pimentel129 estimate that by 2050, 0.7–0.8 billion hectares will be available for food production, and Wackernagel et al.130 estimate that the world’s bio-capacity will decline to 1.2

120. World Bank 2001a and 2000; and World Bank 2001b, 33, 37–38, 170. 121. Butts 1999, 115. 122. Lietzmann and Vest 1999. 123. Gore 1992. 124. Pimentel et al. 1994. 125. Wackernagel and Rees 1995. 126. Wackernagel et al. 1999. 127. Ecological footprint indicates the land and water area per capita required to sustain actual production, waste and pollution. Bio-capacity indicates the land and water area per capita available for this purpose. 128. The US footprint per capita is larger than the US bio-capacity per capita. This also is the case for many other countries. 129. Pimentel and Pimentel 1997. 130. Wackernagel et al. 1999.

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hectares per capita. Thus, attaining the current US standard of living for the whole world is expected to become even more impossible. Cohen131 reviews the assumptions and computations of a considerable number of studies that estimate the number of people the Earth can support given the current state of technology. We can summarize this large body of work by noting that estimates cluster between 4 and 16 billion, depending on the assumed standard of living that people are expected to maintain over time. Studies assuming the current US standard of living typically conclude that the Earth could support 2 to 5 billion people.132 Neoclassical economic growth models assume that natural resources can be substituted in production by other materials, and innovation constantly generates new materials.133 Applying the current rate of mineral consumption of DCs to all nations, several scholars estimate that around half of their known reserves would be exhausted by 2050.134 While new reserves of resources might be discovered, these estimates illustrate the extent of substitution and innovation required to alleviate the impending resource shortages. In 1999, fossil fuels provided 87% of the world’s energy.135 Assuming that in 2050 there are 9 billion people and economic growth has continued at current rates, world energy consumption, currently 10 trillion watts, would double. From where will this energy come? As discussed in Trainer, Hughes, Palfreman, and Hoffert,136 there is no magic solution. Oil stocks are expected to decline. Coal is a possibility, but its use will accelerate climate change. The feasibility of nuclear fusion is debatable. Generating hydrogen for a hydrogen global economy is problematic. Wind and sun energy sources are intermittent. Relying on biomass for the world’s energy would, at current consumption rates, require us to use all the land currently used in human agriculture. Finally, nuclear energy is a possibility. However, at current rates the known amounts of Uranium-235 could sustain the world as the only source only about 10 years.137 The discussion so far illustrates the problems in sustaining perpetual economic growth with the current technology. Can perpetual growth be sustained with technological progress? In neoclassical growth models, the economy can continuously grow if there is beneªcial technological progress. The model presented here does not overrule this possibility. In principle, with technological progress (T) and increased knowledge (H) it is possible to increase output per

131. Cohen 1995. 132. Uvin 1996 arrives at a similar conclusion. The US standard of living is deªned loosely as a composite per capita of measures such as real GDP, resource usage, highways, and longevity. 133. For example, see Simon 1996; Aghion and Hewitt 1998; and Romer 2001. 134. Gordon and Skinner 1987; and Trainer 1998. 135. Nova 2000. 136. Trainer 1998; Hughes 1999; Palfreman 2000; and Hoffert 2000. 137. The current technology for generating hydrogen out of water requires platinum catalysts. It turns out that there is not enough platinum on Earth to support a hydrogen global economy, at the current energy consumption rate. As for nuclear energy, converting the more abundant Uranium-238 into a usable form would take 20 years and produce weapons-grade plutonium as a byproduct (Hoffert 2000). See also Imboden and Jaeger 1999.

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capita (q) while alleviating environmental scarcity. By extension, this would prevent environmental conºict (V). The crucial questions are whether T and H could grow forever, and if so, what their impact would be. Many studies argue or imply that technological progress is beneªcial.138 This optimism is embedded in the neoclassical tradition. Early models assumed the existence of a beneªcial exponential technological progress, and recent studies have modeled the generation of progress. Both approaches conclude that perpetual growth is possible.139 Neoclassical models assume that human capital generates progress, and depleted resources are replaced by other materials, labor, and capital. Progress makes labor ever more productive and production cleaner and less resource-intensive. There also is an assumption that markets work smoothly. Thus, the neoclassical conclusion that perpetual growth is feasible is simply generated by the model’s assumptions. In other words, this conclusion does not necessarily represent some structural truth about how the world really works. In fact, while the neoclassical optimism seems to agree with the historical experience of DCs, it generally does not agree with the data on LDCs. Brieºy, various forces in LDCs impede the supply of progress (T) and human capital (H). Among them, environmental scarcity and environmental conºicts can be acute enough to disrupt the institutions (S) necessary for human capital accumulation (H), generation of progress (T), and application of current technology. Scarcity and conºicts also can stimulate rent seeking, reducing the funds available for innovation and building institutions.140 That said, environmental scarcity also could stimulate technological progress, as necessity is the mother of invention.141 However, this argument assumes that actors know the costs and beneªts. When property rights are not well developed, as is true in many LDCs, or when innovations exhibit public-good charac- teristics, actors become unsure of costs and beneªts. Solving such problems requires institutional changes, which are typically slow. Innovation to alleviate environmental scarcity exhibits these problems and is, in fact, slow. The solutions to complicated problems also require substantial income (Q) and human capital (H), neither of which are abundant in LDCs. Environmental scarcity also may require diverting investments to pressing needs, impeding the accumulation of physical and human capital (K, H) and technology (T).142 The effect of technology is yet another relevant issue. Technology may have non-beneªcial impacts. For example, current energy technology generates greenhouse gases, causing climate change.143 If climate change will eventually result in damages, the overall beneªt of current energy technology may be smaller than the overall cost.

138. See Bailey 1993; Moore 1995; North 1995; Simon 1996; and Ausubel et al. 1996. 139. See, for example, Jones 1998; Aghion and Hewitt 1998; and Romer 2001. 140. Feeny 1988; Dasgupta 1995; Barbier 1999; Lietzmann and Vest 1999; and Homer-Dixon 1999. 141. Boserup 1981; and Simon 1996. 142. Homer Dixon 1999; UNDP 1992; and World Bank 1997 and 2001b. 143. Intergovernmental Panel on Climate Change 2001.

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Finally, can human ingenuity and technological progress face bounds? In the neoclassical model (and in the model presented here) human ingenuity and progress are assumed to have no bounds. However, in reality there could be cog- nitive limits to understanding the nonlinear dynamic interactions of ecological, social, political and economic feedbacks. The stochastic nature of these forces, which typically is ignored in models, further complicates the analysis.144 Tech- nologies also can exhibit limits.145 For example, Kaufman146 shows that energy intensity has declined since the mid-1970s in DCs, but this process exhibits di- minishing returns. This should not surprise us, as the laws of thermodynamics predict a maximum—hence, ªnite—efªciency for energy machines.147 After early successes, agricultural yields fell in many Green Revolution regions, and the response of many crops to fertilizers is lessening.148 Agricultural output growth requires irrigation, which exhibits shortage.149 The prospects of biotech- nology also may be limited.150 These examples do not mean that technological progress and human ingenuity must stop in the future. However, they imply a need for caution when it comes to policy-making.

Policy Implications This paper has demonstrated the prevalence of the view that economic growth prevents conºict. However, it has also provided reasons to suspect that economic growth is the panacea for environmental conºict, as the ecosystem may not be able to sustain perpetual economic growth. It follows that economic growth could in fact promote more, not less, environmental scarcity and, by extension, more environmental conºict. Accepting for the moment the argument that human ingenuity can sustain perpetual economic growth and alleviate environmental scarcity at the same time, this process surely is not instantaneous. The delay could spell acute political problems. For example, one could envision interstate conºicts over dwin- dling fresh water supplies or conºicts over oil while alternatives are not up to speed. If global warming causes sea levels to rise, LDCs are expected to experience higher damages than DCs.151 Major LDCs such as China might then blame the consumption culture of DCs such as the US for causing these damages, and demand compensation. The road to political instability may not be a long one.152

144. Traub and Wozniakowski 1994. 145. Hughes 1999. 146. Kaufman 1992. 147. Fossil fuel and biomass energy machines are approaching this maximum. The efªciency of sun and wind energy machines is lower (Nova 2000). 148. Pingali et al. 1997; and Brown et al. 2000. 149. Food and Agriculture Organization 1996; and Postel 1998. 150. Hilman 1995. 151. Intergovernmental Panel on Climate Change 2001. 152. Conºicts of interest do not have to lead to violence, and local conºicts may not become global. Historically, many conºicts became violent, and local conºicts spread to other countries.

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Wealth and income differences between LDCs and DCs are not well reºected in growth models that employ a neoclassical framework, including mine, as their simpliªed version of reality assumes that all actors have the same income and wealth. However, we know that the global distribution of income is highly skewed. DCs could presumably ignore this point. This would be ethically problematic in that it ignores the fact that the current plight of LDCs is partly due to the past actions of DCs. Ignoring the plight of LDCs also is politically dangerous. Historically, highly skewed distributions of income have led to armed conºicts. In light of the proliferation of weapons of mass destruction in LDCs and the rise in terrorism directed at rich countries, ignoring the plight of LDCs amounts to a game of Russian roulette. Thus, it is important that LDCs attain the standard of living in DCs. Unfortunately, the previous section illustrates that this also is problematic. We face a dilemma. Economic growth could promote peace and development, but with the current technology the biosphere cannot sustain a rich nation’s standard of living for all nations. Whether technology could solve the dilemma is unclear. My approach to solving this dilemma is based on two principles. First, economic expansion in LDCs must be offset by contraction in DCs. Second, economic contraction in DCs must be made contingent upon population stabilization in LDCs at current levels. As a result, per capita income in LDCs will rise, and in DCs it will decline. The combination of economic contraction in DCs and expansion and population stabilization in LDCs will reduce the expected increase in damage to the ecosystem due to economic growth in LDCs.153 There are several problems with the implementation of my approach. First, it could not be implemented overnight. Since socio-economic-ecological processes are slow, the beneªts from this approach may not be apparent for some time. There also could be problems of international collective action and free riding. These difªcult issues require separate analyses. That said, economic contraction in DCs could be achieved, for example, by increasing taxes. The ex- tra revenues could be transferred from DCs to LDCs in various forms, including technology and physical capital. To accelerate the process, DCs could forgive all outstanding LDC debts to DCs.154 DCs probably will not agree to curb their pursuit of wealth, let alone transfer considerable wealth to LDCs, any time soon. Societies will continue to muddle around for some time and the pressures on the biosphere will continue

153. It is possible to argue that democracy can prevent environmental conºict. While this issue is best left to a separate analysis, democracy may not be the panacea. Historically, democracies rarely fought each other, but, they have not been less conºict-prone than autocracies. Democracies (the US and Russia) are said to deploy nuclear warheads aimed at each other. Democracy also is negatively associated with environmental preservation (Midlarsky 1998). Democracies have disputes over climate change, which can be characterized as a Malthusian conºict over the atmosphere. It is not clear that democracy can be stable in a Malthusian world. In fact, democracies in LDCs are not as stable as in DCs. 154. DCs also could eliminate the subsidies they pay to their farmers, moving the money to LDCs. Additionally, the food overproduction in some DCs could be sold to LDCs at reduced prices.

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to rise, inducing more conºicts. The proposed approach might be initiated eventually in response to some massive ecological-social-political crisis.155 How- ever, such a crisis also might cause extensive damages. If this turns out to be the case, whether or not the damages could be alleviated would depend on the nature of the crisis and the extent of the damages up to that point. Negative outcomes do not have to happen. Human ingenuity might yet save the day. Then again, it might not. For now, it seems that the best reason we have to reject the Malthusian paradigm is that in the past human ingenuity has found solutions to many, but not all, problems. There is a need for caution. Many analysts assume that progress is exponential. Extrapolating progress expo- nentially from earlier trends implies that vehicles would have attained the speed of light by 1982, or that humans would have achieved immortality by 2000.156 These predictions have proven inaccurate. The processes and outcomes discussed here involve a good deal of uncertainty. Facing this uncertainty, one could take a “wait and see” position. One also could choose to act sooner. Since the ecosystem provides non-substitutable services to society (e.g., atmospheric integrity, biodiversity, photosynthesis, hos- pitable climate system), I believe that it is important to minimize the risks associated with the effects of economic activity on the ecosystem, and reject the “wait and see” position. In the end, whether the rich nations accept my approach has to do with one’s attitude toward risk. My own stance is reºected in my considerations when I purchase insurance. We know that people typically purchase insurance when the expected cost (deªned as probability multiplied by cost) is high, not when the probability of the damage per se is high. While I cannot suggest pre- cise numbers, I believe that if we continue with business as usual, the expected cost of a global ecological-social-political crisis would most likely rise quickly, which supports the adoption of my approach sooner, rather than later in response to the crisis. As the saying goes, it is better to be safe than sorry.

References Adler, Jonathan H. 1998. Hot Air. National Review 50: 36–41. Aghion, Paul, and Paul Hewitt. 1998. Endogenous Growth Theory. Cambridge, MA: The MIT Press. Ausubel, Jesse H., et al. 1996. The Liberation of the Environment. Daedalus 125: 80–98. Ayres, Robert U. 1969. Technological Forecasting and Long-Range Planning. New York: McGraw-Hill. Baechler, Gunther. 1998. Why Environmental Transformation Causes Violence: A Synthesis. Environmental Change and Security Project, Report 4. ______. 1999. Violence through Environmental Discrimination. Dordrecht, The Neth- erlands: Kluwer.

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