Equity and sustainability over the next fifty years: An exercise in economic visioning
A simplistic aggregate model of global economic activity supports a 50-year visioning exercise with targets defined in terms of aggregate measures of global equity (convergence) and sustainability (contraction). Some ambitious combinations of these targets turn out to be infeasible even under the most favorable modeling assumptions. No contraction target (no reduction in fossil fuel consumption relative to the present) was possible, for example, if international capital transfers pushed per capita incomes in low-income countries above 33% of levels achieved in high-income countries. Lower prices for renewable alternatives to exhaustible resources generally made sustainability targets easier to achieve, but lower prices for renewable resources also made equity targets more difficult to achieve. Improved substitution between capital and labor made equity targets easier to achieve in relative terms, but improved substitution between capital and labor could make any given sustainability target more or less difficult to achieve. All the results suggest that it is possible to overstate the purported conflict between achieving sustainability and equity targets. The very transfers of international capital that would promote relative equity between high-income and low-income countries could also work to spread the incidence of achieving any sustainability target more evenly across their boundaries.