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Economic modeling and the ex-ante measurement of sustainability
TRIER-PISA SUMMER SCHOOL ON MEASUREMENT OF WELFARE AND SOCIAL PROGRESS
Fabio Eboli
FEEM, CMCC
PISA, 11th September 2013
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
OUTLINE
MOTIVATION AND PURPOSE
METHODOLOGY
CURRENT AND FUTURE SUSTAINABILITY (SCENARIOS ANALYSIS)
CONCLUSIONS
1
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
OUTLINE
MOTIVATION AND PURPOSE
METHODOLOGY
CURRENT AND FUTURE SUSTAINABILITY (SCENARIOS ANALYSIS)
CONCLUSIONS
2
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
SUSTAINABLE DEVELOPMENT IN SHORT
• Well known concept
Economic growth crucial but no good proxy for wellbeing
Economic growth may negatively affect other components of wellbeing (however, not only environment ….)
Inter‐generational Equity
• Stockholm 1972, Our Common Future 1987, Rio 1992 and 2012
qualitative debate (we are going in the wrong direction, we need to do something) => Paradigm shift
sustainable development => green growth, green economy (Inclusive Growth, GGKP – Green Growth Knowledge Platform, Europe 2020)
3
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
4
• Not only environmental concerns …. but everlasting trade‐offs between economic growth and environmental deterioration
Kenneth Boulding => The Economics of the ComingSpaceship Earth (1966)“I am tempted to call the open economy the "cowboy economy," the cowboy being symbolic of the illimitable plains and also associated with reckless, exploitative, romantic, and violent behavior, which is characteristic of open societies. The closed economy of the future might similarly be called the "spaceman economy", in which the earth has become a single spaceship, without unlimited reservoirs of anything, either for extraction or for pollution, and in which, therefore, man must find his place in a cyclical ecologicalsystem which is capable of continuous reproduction of material form eventhough it cannot escape having inputs of energy.”
ECONOMIC GROWTH vs ENVIRONMENT
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
5
=> long‐term sustainable trends?
• Many concerns: Coase (1960), Hardin (1968), Limits to Growth (1972), Wackernagel and Rees (1994, 1996)
MARKET FAILURES: EXTERNALITIES
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
6
• Environment and Natural Resources => Inputs/constraints for economic systems?
Upstream => Extraction of natural resources (extraction/harvestrate higher than growth/regeneration rate)
Downstream => Pollution of environment receptors (pollutionquality and quantity worse/higher than assimilative/carryingcapacity)
• An alternative Production Function
MARKET FAILURES: EXTERNALITIES
Q = f (L,K) Q = f (L,K,R,-E)
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
7
• 250 “RIO + 20” principle => We recognize that progress towards the achievement of the goals needs to be assessed and accompanied by targets and indicators, while taking into account different national circumstances, capacities and levels of development.
• RIO 2012 Issues Briefs n. 6 => Sustainable development indicators and composite indicators are considered to be a good vehicle in helping to measure sustainable development and progress achieved in it … They can help to share policy on the basis of information which is transparent and evidence‐based.
• Sustainable development indicators: A statistical measure that gives an indication on the sustainability of social, environmental and economic development.
• Composite indicators: the compilation of individual indicators into a single index, on the basis of an underlying model of the multi‐dimensional concept that is being measured.
RIO + 20 STATEMENTS
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
8
SUSTAINABLE DEVELOPMENT GOALS
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
9
• 2012 = RIO + 20 => 2 main objectives
integration of sustainable development at all levels of institutional governance
green economy (make more concrete the concept of sustainable development?)
RIO 2012
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
HOW TO MEASURE SUSTAINABILITY?
• From theory to practice
Policy‐makers ask for quantitative assessment (distance‐to‐target)
Immediate focus on collection of single indicators – dashboards mainly from institutional bodies:
UN CSD (Sustainable Development Goals)
OECD (Green Growth indicators)
EUROSTAT (Sustainable Development indicators)
ISTAT (Benessere Equo e Sostenibile)
• Main limitation: overall sustainability (at various level of governance) difficult to evaluate and compare
10
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
COMPOSITE INDEXES
• OECD Handbook on constructing composite indicators
• Sen‐Stiglitz‐Fitoussi Commission’s concerns:
heterogeneity among indicators
the arbitrary character of the procedures used to weight their various components
• Aggregate Indexes
Human Development Index (economic + social)
Ecological Footprint (economic pressure on environment)
Index of Sustainable Economic Welfare, Genuine Savings ‐ Adjusted Net Savings, Genuine Progress Indicator (adjusted GDP)
• Both indicators and composite indexes only look at historical and current trend
11
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
OUTLINE
MOTIVATION AND PURPOSE
METHODOLOGY
CURRENT AND FUTURE SUSTAINABILITY (SCENARIOS ANALYSIS)
CONCLUSIONS
12
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
FEEM SI: SCOPE, METHODOLOGY, RESULTS
• FEEM SI tries to fill this main gap => how sustainability may evolve in the future
under different assumptions on economic drivers
considering a set of sustainability policies
interdisciplinary approach (all dimensions considered at once)
• CGE + aggregation procedure
• Main results:
decoupling between World Domestic Product and World Sustainability in the reference scenario
policies addressing one specific field of sustainability may imply relevant trade‐offs among spheres
a comprehensive policy for sustainability may lead to a win‐win solution (increase in sustainability and no emerging trade‐offs)
13
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
FRAMEWORK
• New approach to consider:
All dimensions simultaneously involved
Common framework for comparison
Future projections and scenario analysis
• Quantitative assessment of sustainability at country/macroregion scale (worldwide coverage) over time
• New (and quite complex) methodology:
Indicators computation => macroeconomic model (recursive‐dynamic computable/applied general equilibrium model)
Aggregate Index => normalisation + aggregation
14
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
OVERALL STRUCTURE AND MAIN STEPS
15
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
INDICATORS’ SELECTION
16
Criteria for selection:
Recognized/used by sustainable developmentcommunity
Historical record available for all the world
Consistent with the macro‐economic model to compute them over time
Targets/benchmarks available for normalizationpurposes
INDICATOR SET ORGANIZATION TYPE
EU Sustainable Development Strategy (EU
SDS)
European Commission Theme‐based indicator set
UN Commission on Sustainable Development
(UN CDS)
United Nations
Three‐pillar indicator set (2001)
Theme‐based indicator set (2006)
World Development Indicators (WDI) World Bank
Theme‐based indicator set
EEA core set of indicators Eurostat, European
Environmental Agency
Environmental indicators
International Energy Outlook (IEO) International Energy
Agency
Environmental indicators
World Economic Outlook Databases (WEO) International Monetary
Fund
Economic Indicators
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
INDICATORS’ TREE
17
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
INDICATORS’ DESCRIPTION
18
SD Dimension INDICATOR LONG DESCRIPTION
Economic
R&D R&D expenditure / GDP (%)
Investment Net Investment / Capital Stock (%)
GDP p.c. GDP (PPP) / Population
Relative Trade Balance Trade Balance / Market Openness (exp + imp)
Public Debt Government Debt / GDP (%)
Environmental
GHG per capita Kyoto GHGs Emissions / Population
CO2 Intensity CO2 Emissions / Total Primary Energy Cons.
Energy Intensity Total Primary Energy Supply / GDP PPP
Renewables Renewable Cons. / Total Primary Energy Cons. (%)
Water Water Use / Total Available Water (%)
Plants Endangered Species / Total Species (%)
Animals Endangered Species / Total Species (%)
Social
Population Density Population / Country Inhabitable Surface
Education Education Exp. / GDP (%)
Health Health Exp. / GDP (%)
Food Relevance Food Cons. / Households’ Exp. (%)
Private Health Private Health Exp. / Total Health Exp. (%)
Energy Imported Energy Imported / Energy Cons. (%)
Energy Access Population with Access to Electricity / Total Population (%)
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
MODELLING FRAMEWORK
• ICES‐SI framework
Recursive‐Dynamic Computable General Equilibrium model (ICES)
GTAP 7 database
=> Both extended for FEEM SI purpose
19
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
MODELLING FRAMEWORK: DATABASE
• GTAP7 database (Narayanan and Walmsley, 2008)
Content: all economic (and energy) flows in Input‐Output (SAM) matrix format
Baseyear: 2004
Geographic coverage: world (113 countries/regions)
Sector coverage: the whole economic system(split in 57 sectors)
20
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
MODELLING FRAMEWORK: DB EXTENSIONS
• Split of several sectors
21
Original GTAP7 sector New involved sector
“Other Business Services” R&D
“Other Generative Services” Private Health/Public HealthEducation
“Electricity” Renewables
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
• Enriched with following data for 2004:
GDP (PPP)
Public Debt
CO2 and other GHGs
Water consumption and available water stock
Animals and Plants species
Inhabitable surface
Energy Access population
22
MODELLING FRAMEWORK: DB EXTENSIONS
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
MODELLING FRAMEWORK: CGE MODELS
23
• Main scope: assessing higher‐order (general) effects on the whole economic system assuming localized shocks within it
• First applications: International trade, taxation, agriculturalpolicy => recent development on environmental economics(mainly climate change and other transboundary issues)
• Main results: impacts on GDP, sectoral output and prices, international trade when considering market‐driven(autonomous) adaptation of economic agents (vs bottom‐up approaches) => scenario analysis
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
24
GTAP (Hertel, 1997)
GTAP-E (Burniaux and Troung, 2002)
ICES (Eboli et al., 2010)
ICES-SI (Carraro et al., 2011)
MODELLING FRAMEWORK: CGE MODELS
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
NORMALIZATION: RESCALING
• Indicators are normally expressed in different measure units => make them comparable and allow aggregation requires a normalization procedure (such that all of them will be defined in the [0,1] interval).
25
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
NORMALIZATION: BENCHMARKING
• Next steps is to define classes of sustainability
• Benchmarks are taken by literature or policy targets => find intermediate levels of sustainabilty is very hard for many indicators, even for experts
• We are planning to define only two levels for next issue: fully sustainability and fully unsustainability (sustainability threesholds), in between => linear behaviour => Less precise but less speculative!
26
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
AGGREGATION: PREFERENCES’ ELICITATION
27
Economic Social Environmental Weights
Worst Worst Worst 0
Best Worst Worst 20
Worst Best Worst 50
Worst Worst Best 30
Best Best Worst X ≥ 50
Best Worst Best X ≥ 30
Worst Best Best X ≥ 50
Best Best Best 100
Experts/stakeholders/decision makers?
Monotonici
ty
• The preference among sustainability indicators is obtained with an “ad hoc” questionnaire that elicits individual preferences on the specific performance of each sustainability indicator and their coalitions.
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
AGGREGATION: CONSENSUS AND CHOQUET
• A consensusmeasure among experts’ valuations is considered in order to derive a ‘representative’ weight assigned to each sustainability indicator (andness/orness). For this purpose, the metric distance measure is used to assign weights to the responses of each expert at each node in the decision tree.
• This method optimizes the trade off between simplicity and effectiveness in representing preferences by focusing specifically on the interrelations across indicators (non additive measure, since allows considering redundancy and synergy). Therefore, a suitable algorithm based on the Choquet integralaggregates all criteria into a single outcome, taking into account all the coalition weights.
28
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
AGGREGATION: SHAPLEY INDEX
29
Indicator’s contribution to overall index
Relative importance of each indicator at a given node
Indicator Contribution to
overall index
GDP per capita 0.1128
Population Density 0.0790
Education 0.0644
Health 0.0639
GHG per capita 0.0637
R&D 0.0635
Water 0.0635
Renewables 0.0618
CO2 Intensity 0.0616
Investment 0.0600
Energy Intensity 0.0564
Relative Trade Balance 0.0487
Food relevance 0.0416
National Debt 0.0410
Private Health 0.0362
Animals 0.0258
Plants 0.0253
Energy Imported 0.0154
Energy Access 0.0154
Node Criterion Shapley value
FEEMSIEconomic 0.326Social 0.316Environmental 0.358
EconomicGrowth drivers 0.379
GDP per capita 0.346
Exposure 0.275
SocialPopulation Density 0.250
Well Being 0.406
Vulnerability 0.344
EnvironmentAir pollution 0.350
Energy 0.330
Natural Endowment 0.320
Growth DriversR&D 0.514
Investment 0.486
ExposureRelative Trade Balance 0.543
National Debt 0.457
Well BeingEducation 0.502
Health 0.498
Vulnerability
Food relevance 0.383
Energy Security 0.283
Private Health 0.333
Energy SecurityEnergy Imported 0.500
Energy Access 0.500
Air pollutionGHG per capita 0.508
CO2 Intensity 0.492
EnergyEnergy Intensity 0.477
Renewables 0.523
Natural EndowmentBiodiversity 0.446
Water 0.554
BiodiversityAnimals 0.504
Plants 0.496
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
OUTLINE
MOTIVATION AND PURPOSE
METHODOLOGY
CURRENT AND FUTURE SUSTAINABILITY (SCENARIOS ANALYSIS)
CONCLUSIONS
30
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
APPLICATION: REGIONAL DETAIL
31
No. Country/Region
1 Australia2 NewZealand3 Japan4 Korea5 China6 India7 Indonesia8 SEastAsia9 RoAsia10 USA11 Canada12 Mexico13 Brazil14 RoLA15 Austria16 Benelux17 Denmark18 Finland19 France20 Germany
No. Country/Region
21 Greece22 Ireland23 Italy24 Poland25 Portugal26 Spain27 Sweden28 UK29 RoEU30 Switzerland31 Norway32 RoEurope33 Russia34 RoFSU35 Turkey36 MiddleEast37 NorthAfrica38 RoAfrica39 SouthAfrica40 RoWorld
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
APPLICATION: SECTOR DETAIL
32
No. Sector
1 Food 2 Forestry3 Fishing4 Coal5 Oil6 Gas7 Petroleum Products8 Other Electricity9 Renewables10 Nuclear11 Biofuels12 Energy Intensive Industries13 Other Industries14 Water15 Market Services16 Public Services17 R&D18 Education19 Private Health20 Public Health
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
WORLD SUSTAINABILITY RANKING IN 2011
33
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
FEEM SI vs … GDP!!!
34
GDP p.c.
Ranking Country
FEEM SI
Ranking GDP p.c.
Ranking Country
FEEM SI
Ranking
1 Norway 1 21 Portugal 17
2 USA 11 22 Poland 29
3 Switzerland 3 23 MiddleEast 28
4 Australia 12 24 RoEU 22
5 Austria 4 25 Russia 21
6 Ireland 9 26 Mexico 23
7 Denmark 6 27 RoEurope 15
8 Benelux 20 28 RoLA 18
9 Sweden 2 29 SouthAfrica 30
10 Canada 7 30 Brazil 13
11 Germany 16 31 Turkey 27
12 Finland 5 32 RoFSU 35
13 UK 14 33 RoWorld 33
14 Japan 26 34 SEastAsia 34
15 France 8 35 NorthAfrica 36
16 Spain 19 36 Indonesia 38
17 Italy 25 37 China 39
18 Korea 24 38 India 40
19 NewZealand 10 39 RoAsia 37
20 Greece 31 40 RoAfrica 32
Correlation coefficients between GDP p.c. & FEEM SI, economic, social and environmental pillars
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
WORLD SUSTAINABILITY MAPS IN 2011
35
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
CURRENT SUSTAINABILITY DRIVERS
36
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
SENSITIVITY/ROBUSTNESS
37
Distribution of FEEM SI value by country according to 500 artificial decision makers
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
THE BASELINE SCENARIO
38
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
39
Variable Reference source
PopulationUN World Population Prospect (2010 revision) –medium fertility variant
Fossil fuel prices Eurelectric (2010)
GDP
2005‐2009 = World Bank (WDI 2010)2010‐2020 = MMC_G10 scenario Med Pop ‐Medium Growth ‐ Fast Convergence (Conv) developed within the RoSE project + World Economic Outlook 2010 (IMF, 2010) for downscaling at country level
Energy intensity2005‐2009 = IEA (2010)2010‐2020 = endogenous
CO2 emissions2005‐2009 = IEA (2010)2010‐2020 = endogenous
Public debt IMF (2010)
Main variables and reference sources in the baseline scenario
THE BASELINE SCENARIO
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
GDP GROWTH 2005-2020
40
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
SUSTAINABILITY PICTURE: 2020 vs 2011
41
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
SUSTAINABILITY TRENDS: TOP TEN
42
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
SUSTAINABILITY TRENDS: BOTTOM TEN
43
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
SUSTAINABILITY TRENDS: AGGREGATES
44
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
COUNTERFACTUALS => POLICY SET
45
Overall Policy Design
Climate Policy (Cancún high pledges and coordinated action)
Increased water use efficiency in agriculture and industrial sectors in all countries
Subsidies on Education in LDC (MDG targets)
Subsidies on Public Health in LDC (MDG targets)
Subsidies on R&D in Advanced Economies and technological transfer in agriculture and industrial sectors in LDC
Climate Policy: Cancun Agreements - High‐pledges
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
POLICY EFFECTS: WORLD
46
-8
-6
-4
-2
0
2
4
6
8
%
SD POLICY vs. BASELINE
Economic Social Environmental FEEM SI GDP pc
-8
-6
-4
-2
0
2
4
6
8
%
SOCIAL POLICY vs. BASELINE
Economic Social Environmental FEEM SI GDP pc
-8
-6
-4
-2
0
2
4
6
8
%
ENV POLICY vs. BASELINE
Economic Social Environmental FEEM SI GDP pc
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
POLICY EFFECTS: REGIONAL AGGREGATES
47
-8
-6
-4
-2
0
2
4
6
8
10
SD Policy Social Policy Environmental Policy
% V
aria
tion
-15
-10
-5
0
5
10
15
20
25
SD Policy Social Policy Environmental Policy
% V
aria
tion
-15
-10
-5
0
5
10
15
20
25
SD Policy Social Policy Environmental Policy
% V
aria
tion
EU27
DC LDC
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
POLICY EFFECTS: REGIONAL AGGREGATES
48
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
FOCUS ON CLIMATE POLICY
49
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
OUTLINE
MOTIVATION AND PURPOSE
METHODOLOGY
CURRENT AND FUTURE SUSTAINABILITY (SCENARIOS ANALYSIS)
CONCLUSIONS
50
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
CONCLUSIONS• A nex composite index to assess future sustainability worldwide is proposed
• The approach allows considering higher order effects deriving from changes in economic system (also due to policies for sustainability)
• In the next decade, sustainability at world level is expected to decrease, mainly due to the social component deterioration (decoupling between GDP and sustainability)
• Ad hoc sectoral policies are expected to increase sustainability at world level (higher benefits than costs in terms of sustainability) => but trade‐offs among pillars and world GDP reduction
• An integrated policy for SD implies the best outcomes at world level in terms of both GDP and Sustainability (win‐win solution)
51
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
MAIN OUTCOMES
• Projects
Two‐years based updated releases of sustainability assessment (methodology improvement, new experts and stakeholders surveys, ….) => next: 12 November 2013
In‐Stream (INtegrating MainSTREAM Economic Indicators with Sustainable Development Objectives) project
• Scientific outcomes
1 website, 2 brochures, 2 methodological report, 4 working papers, 2 on line articles on RE3 journal, 2 submitted articles to scientific journals, 2 articles on “Equilibri”, 1 book chapter, 6 conferences, 2 summer school
52
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
NEXT STEPS
• Introduction of new indicators (corruption, ICT, wasteproduction, material intensity)
• Database updated to 2007
• Baseline extension to 2030
• New elicitation method (from nest to scenario evaluation)
(https://qtrial.qualtrics.com/SE/?SID=SV_3CwRDaHAnkJvG9D)
• Event of presentation: 12/11/2013
53
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
TEAM
54
Project CoordinatorCarlo Carraro
Team LeaderFabio Eboli
Research Team
Francesco Bosello
Lorenza Campagnolo
Luca Farnia
Silvio Giove
Ramiro Parrado
Roberta Pierfederici
Web Master
Paolo Gittoi
Irene Bellin
Graphic Project
Renato Dalla Venezia
Management
Monica Eberle
Communication
Jacopo Crimi
PRESENTATIONTITLE
Economic modeling and the ex-ante measurement of sustainability
Economic modeling and the ex-ante measurement of sustainability
Thank you for your attention!
www.feemsi.org