Towards an Environment Research Agenda: A Third Selection of Papers

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Towards an Environment Research Agenda A Third Selection of Papers

Edited by

Adrian Winnett

Towards an Environment Research Agenda

Related titles Towards a Collaborative Environment Research Agenda (edited by Alyson Warhurst) Towards an Environment Research Agenda: A Second Selection of Papers (edited by Adrian Winnett and Alyson Warhurst)

Towards an Environment Research Agenda A Third Selection of Papers Edited by

Adrian Winnett International Centre for the Environment University of Bath

Selection, editorial matter and Introduction © Adrian Winnett 2004 Individual chapters © the contributors 2004 All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. No paragraph of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London W1T 4LP. Any person who does any unauthorized act in relation to this publication may be liable to criminal prosecution and civil claims for damages. The authors have asserted their rights to be identified as the authors of this work in accordance with the Copyright, Designs and Patents Act 1988. First published 2004 by PALGRAVE MACMILLAN Houndmills, Basingstoke, Hampshire RG21 6XS and 175 Fifth Avenue, New York, N.Y. 10010 Companies and representatives throughout the world PALGRAVE MACMILLAN is the global academic imprint of the Palgrave Macmillan division of St. Martin’s Press, LLC and of Palgrave Macmillan Ltd. Macmillan® is a registered trademark in the United States, United Kingdom and other countries. Palgrave is a registered trademark in the European Union and other countries. ISBN 0–333–67481–2 This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources. A catalogue record for this book is available from the British Library. Library of Congress Cataloging-in-Publication Data Towards an environment research agenda : a third selection of papers / edited by Adrian Winnett. p. cm. Includes bibliographical references and index. ISBN 0–333–67481–2 1. Environmental management—Research. 2. Environmental management—Economic aspects. I. Winnett, Adrian. GE300.T69 2004 363.7—dc22 10 13

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Printed and bound in Great Britain by Antony Rowe Ltd, Chippenham and Eastbourne

Contents Acknowledgement

vii

Notes on the Contributors

viii

Introduction

xiv

Part I 1

Understanding the Environment

Some Interdisciplinary Perspectives on Environmental Appraisal and Valuation Geoffrey P. Hammond and Adrian B. Winnett

2

Talking Environmental Imperatives to Death Alfred Moore

3

Environmental Preferences and Piaget’s Theory of Knowledge: Searching for Necessity in Environmental Preference in Northern Thailand Kevin Marsh

Part II 4

5

6

7

34

51

Valuing the Environment

An Ecological and Economic Approach to Valuing River Quality Claire Johnstone Willingness to Pay for Reduction in Risk of Mortality due to Air Pollution in Brazil: Preliminary Results Ramon Arigoni Ortiz

Part III

3

87

102

Policy and Politics

Trade and Environment: Linkages in Multilateral Environmental Agreements Tim Taylor, Alistair Hunt and Anil Markandya

123

Red–Green and Beyond: The German Green Party after the 2002 Elections Ingolfur Blühdorn

149

v

vi Contents

Part IV

Technology, Engineering and the Environment

8 Engineering Sustainability: Thermodynamics, Energy Systems and the Environment Geoffrey P. Hammond 9 Life-Cycle Design for Engineered Timber Products Martin P. Ansell, Richard J. Murphy and Bill Hillier

Part V

175 211

Managing the Environment

10 A Car in Three Days! Environmental Impacts of the Automotive Supply Chain Joe Miemczyk

235

11 Paradox in Marketing: An Inquiry into Sustainability, Ethics and Marketing Carole Bond and Chris Seeley

256

Part VI

Afterword

12 Local Agenda 21 into Local Action 21 Stephen Bendle

285

Index

297

Acknowledgement The editor is very grateful to the ICE administrator, Carolina Salter, for organizing the seminar series and editing the papers with unfailing efficiency and enthusiasm. A DRIAN W INNETT

vii

Notes on the Contributors Martin P. Ansell is a Senior Lecturer in the Faculty of Engineering and Design at the University of Bath. He lectures on the structure-related mechanical properties of materials and the environmental consequences of extracting, using and designing with materials. Professional qualifications include Fellow of the Institute of Materials, Minerals and Mining and Fellow of the Institute of Wood Science. Dr Ansell is a Past President of the Institute of Wood Science (1994–6) and has sat on EPSRC, DETR and Foresight committees. He is the author or a co-author of over 140 research publications. His research is concerned with sustainable materials including natural fibre composites and timber science and engineering. In the 1980s and 1990s his research group made a major contribution to the understanding of the fatigue properties of wood and wood laminates for wind turbine blades and a series of grants was funded by the DTI and the EU. In recent years his group has developed an understanding of connection and reinforcement systems for timber, using bonded-in reinforced composite or steel dowels and plates, for structures such as bridges and buildings, which experience static and fatigue loads. Work on natural fibre composites, including those with natural resin matrices, has been in progress for over 20 years. Dr Ansell is the UK manager of a British Council Higher Education Link with Malaysia on kenaf fibers and he has other research links with Japan, China, Mexico and Tanzania. Stephen Bendle has been Director of Envolve since autumn 1998. Envolve was set up in 1994 and has been successful in working in partnerships to deliver a wide range of innovative practical sustainability projects. Previously Stephen Bendle worked for five years as an independent consultant, focusing on housing, community and environmental issues and from 1980 to 1993 was Managing Director of the Horizon Housing Group (at that time South London Family Housing). With a colleague in Birmingham, he set up People for Action, a national network of housing associations committed to a wider agenda of community development. Ingolfur Blühdorn is Senior Lecturer in European Politics at the University of Bath, Department of European Studies. He has published widely in the field of social theory, eco-political thought and the German Green Party. viii

Notes on the Contributors ix

Carole Bond is a highly experienced sustainable development practitioner with many years of business experience spanning heavy manufacturing, the media, precision engineering and environmental consultancy. For the past decade or so she has specialised in environment, sustainable development and corporate social responsibility issues, working directly with a range of organizations and also through the creation of cross-sectoral partnerships, and initiatives. She launched her company, Carbon Data, in 1993 and her clients include businesses from both the corporate and small to medium-sized enterprise sectors, UK Business Links, waste disposal authorities, professional institutions and universities, and government departments including the DTI and DEFRA and NGOs. Carole is an associate of the New Academy of Business and is a facilitator for The Natural Step UK. She holds a BSc in environmental science from the University of Bradford and an MSc in responsibility and business practice from the University of Bath for her work on language and gender in sustainability. She is also a member of the Institute of Marketing and a Chartered Marketer. She is a founding member of a number of sustainability fora, a director of two regional environmental charities in the south–west and chair of the Bath-based sustainability charity, Envolve.

Geoffrey P. Hammond is Professor of Mechanical Engineering and Director of the International Centre of the Environment (ICE) at the University of Bath. He is a mechanical engineer with a multidisciplinary background, including environmental engineering and management. His research and teaching interests include ‘energy systems and environmental sustainability’, and ‘thermodynamics, fluid flow and heat transfer’. ICE functions as a network within the university and with other centres of excellence in the UK and worldwide. It strives to promote interdisciplinary leadership in environmental research and education across the institution. Outside the university, Professor Hammond is a Patron and was a Founder Trustee (1995–1998) of the Bath Environment Centre Limited (renamed ‘Envolve: partnerships for sustainability’). In September 1998 he became a member of the Environment Agency’s North Wessex Area Environment Group (Deputy Chairman, October 2000), which advises the agency on the range of its regulatory activities. In recent years, he has undertaken international consultancy assignments for government ministries and industrial R and D organizations in Sri Lanka and Taiwan on sustainable energy technologies and energy efficiency in the transport sector respectively.

x Notes on the Contributors

Bill Hillier is an environmental scientist in the Department of Biology and Centre for Environmental Technology at Imperial College London. He gained his BSc in Applied Biology as a mature student at Imperial College in 1992. He has worked on LCA methodologies for applications to preservative-treated wood and other timber products, including wood composites and coating systems. He has participated in EC R&D projects Life Sys Wood, Natural Resins as Wood Preservatives and PRESCO (Practical Recommendations for Sustainable Construction). He has presented papers at international conferences on LCA of forest products, been an invited participant at USEPA workshops on streamlining LCAs and was the UK delegate and leader of the COST Action E9 LCA for Forestry and Forest Products, Working Group 4 on LCA Methodology issues. Alistair Hunt is a Research Officer in the Department of Economics and International Development at the University of Bath. His main researches are in applied environmental economics, including measurement of environmental externalities, the possible adjustment of national accounting welfare measures to incorporate such costs and the effective design of environmental policies. He has worked on the economic basis of climate change policy, including impacts and adaptation assessment, and air and water pollution. Claire Johnstone has recently completed a PhD at the University of Bath in environmental economics. In the last year, she has worked as a consultant in Environmental Protection Economics at DEFRA and for two years prior to that as a business advisor at the Bath-based environmental charity ‘envolve’. Most recently she has worked as a Research Officer at the University of Bath on the NESIS project. Her research interests include the meeting points between environmental valuation, psychology and philosophy. Anil Markandya is Professor of Quantitative Economics at the University of Bath and Lead Economist at the World Bank. He has written widely on issues in environmental economics and is an expert in issues relating to environmental valuation, sustainable development and environmental policy issues. He was a coordinating lead author of the IPCC’s Climate Change 2001: Mitigation report and has recently published Climate Change and Sustainable Development (with K. Halsnaes, Earthscan), which examines the sustainability implications of climate change policy.

Notes on the Contributors xi

Kevin Marsh completed a BA in Economics at Cambridge University, an MA in South–East Asian Studies at SOAS, University of London, and a PhD in Economics at the University of Bath. His research interests include the monetary valuation of natural resources, the forest conservation techniques of the indigenous populations of South–East Asia, and Thai forest policy. He is currently working as a research officer at the Social Disadvantage Research Centre, University of Oxford, where his research is concerned with the impact of British government policy on measures of worklessness and low income. Joe Miemczyk was originally trained as an Environmental Scientist at the University of Wolverhampton. He then travelled to Poland to work as a researcher and environmental educator in a National Park beside the Lithuanian border. Two years later he returned to the UK to complete an MSc in Environmental Assessment and Management at Oxford Brookes University. He moved to the automotive supply industry working as a Business Systems Engineer for Unipart, where he developed and coordinated management systems to ISO 14001, the standard on environmental management systems. During his time at Unipart he also worked closely with management in developing systems to coordinate policy deployment activity. He is now a researcher at the University of Bath, School of Management. Since 1999 he has participated in the 3DayCar Programme, looking at the environmental implications of advanced manufacturing strategies in the automotive sector. Alfred Moore studied physics and philosophy at King’s College London and the University of Göttingen. He then completed an MA in contemporary European politics at the University of Bath, where he has since been working towards his doctorate on ‘Democracy and Risk: The Changing Relations of Science, Politics and the People’ and featuring a case-study of the recent UK controversy over the MMR vaccine, combining his interests in science and social and political thought. Richard J. Murphy is a Senior Lecturer in the Department of Biological Sciences at Imperial College London, an internationally recognized academic research and teaching institution. His research is concerned with the utilization of wood and other plant fibre materials, with special emphasis on their ultrastructure, biodegradation/biodeterioration and environmental properties. The environmental impact assessment work on plant-based and competitive materials has been in progress since 1991, commencing with a specialization in preservative-treated wood using

xii Notes on the Contributors

LCA methods. Studies have included hemp-based composites, agricultural by-products, wood-based composites, tropical timbers and bamboos. He also has research interests in the growth and sustainable management of bamboos and in the utilization of other (agricultural) plant fibres and residues. He has worked in the UK, New Zealand and The Netherlands and has active research collaborations with partners in the EU, USA, Malaysia, Colombia, Indonesia, the Philippines and Costa Rica. He has been President of the Institute of Wood Science (IWSc) and is a member of the International Research Group on Wood Preservation, BSI committee ES/5 on Life-Cycle Assessment (LCA) and COST Action E31 Management of Recovered Wood. He was also Vice-Chairman of the COST action E9 on Life-Cycle Assessment of Forests and Forest Products. Ramon Arigoni Ortiz holds an MSc in Economics and is currently working on his PhD thesis in the University of Bath, which focuses on health risk valuation in Brazil. He has been working for IPEA, the major Brazilian research institute on applied economics, on a range of environmental issues including environmental valuation, forestry, oil pollution and the health costs of air pollution. Recently, he has been involved in projects regarding the Clean Development Mechanism, air quality strategies, and costs of accidents in the fuel chain. He has also worked as a consultant for UNDP and UNESCO in Brazil. Ramon also holds qualifications in international commerce and computer science, has a strong mathematical background and worked in industry before becoming an economist. Chris Seeley is a Visiting Teaching Fellow at the Centre for Action Research in Professional Practice (CARPP) at the University of Bath. She has extensive experience working with business service and economic development organizations and has worked in the micro and small enterprise development sector since 1992 in the UK, US, Africa and Asia. Her clients include the International Labour organization, the National Center for Manufacturing Sciences (US), Business Links (UK), The Natural Step (UK), Schumacher College (UK) and GTZ (Germany). She has also co-founded a new technology-based business working in restoration for the water industry. She has a first degree in design, an MA in marketing and she completed an MSc in responsibility and business practice in 2001 and is now working on her PhD part time on the CARPP programme. She is also a member of the Institute of Marketing and a Chartered Marketer.

Notes on the Contributors xiii

Tim Taylor is a Research Officer in the Department of Economics and International Development at the University of Bath. He has broad research interests in environmental economics, including climate change policy, air quality, water pollution and sustainable development. He has contributed to several books and reports on applied environmental economics and is a co-author of the Dictionary of Environmental Economics (Earthscan). Adrian B. Winnett is Deputy Director of the International Centre for the Environment. He is an economist with particular interests in natural resources and economic growth. He holds degrees from the London School of Economics and the University of East Anglia. Major projects on which he has recently been involved include the management of fisheries in South and South–East Asia, ethical investment in the UK, and waste management in Slovakia. He is currently undertaking a major research project for the European Commission on indicators for the new information economy.

Introduction Adrian Winnett

This is a third selection of papers from the seminar series organized by the University of Bath’s International Centre for the Environment (ICE). ICE is an interdisciplinary forum for environmental research and education, bringing together academics from across Bath University, and with strong links to public, private and voluntary organizations at the local, regional, national and European levels. The papers in the present volume reflect the continuing diversity of interests and approaches within ICE. The intention of ICE is to encourage communication and understanding across this diversity, and the seminars from which these papers are drawn are testimony to the effectiveness of this in practice. As with earlier selections of papers, some of those here are by authors previously represented. However, new authors are also present. In particular, several papers are from seminars presented by advanced research students, and reflect the vitality of a new generation of researchers. The papers in Part I demonstrate a strong commitment to interdisciplinarity as a means of rethinking some basic environmental concepts. The paper by Hammond, an engineer, and Winnett, an economist, builds on a debate on basic environmental concepts which they have had on several occasions, and which reached its current form in an ICE seminar; no doubt it will continue. (The authors currently share the ICE directorate.) Moore considers the relationship of democracy to ecology, drawing both on the political philosophy of value pluralism and on sociological models of risk, to reach unusual and provocative conclusions. Equally innovative is Marsh’s treatment, drawing on Piaget’s work, of the nature–culture dichotomy and its relationship to the understanding of environmental preferences. This raises quite fundamental questions about environmental preferences, which have implications for the sorts of valuation procedures often used. Part II turns to sophisticated attempts to develop such valuations in practice. Johnstone combines ecological and economic data, in novel ways, to derive estimates for the value of river quality in the UK. Ortiz addresses a particularly complex problem of pressing importance, xiv

Introduction xv

namely the valuation of the benefits of reducing mortality through reducing air pollution in developing economies. Turning to the policy arena, in Part III, Taylor, Markandya and Hunt consider the impacts on global trade that arise from the growing number and sophistication of international environmental agreements, focusing especially on the role of stakeholders in determining the success or failure of such agreements. Blühdorn considers recent Green Party experience in Germany, which is fraught with implications for our understanding of the nature and role of a specifically green politics. Engineers have developed distinctive approaches to environmental evaluation and design. In Part IV, Hammond critically assesses methods of energy and exergy analysis in order to evaluate thermodynamic concepts when these are used as measures of the sustainability of energy systems and components. Ansell, Murphy and Hillier show how life-cycle assessment can be used in novel ways to evaluate and improve the design of, in their example, engineered timber products (itself an unusual and important application). Environmental concerns have become central to many areas of management. In Part V, Miemczyk considers the important environmental aspects of supply-chain management, in the context of major developments in the automotive industry. Bond and Seeley argue that marketing may be forced to reinvent itself in order to successfully link business into an environment that increasingly emphasizes sustainability and ethical practice. The volume concludes with Bendle’s wide-ranging think-piece on progress in moving the aspirations of Rio forward into local action. Stephen Bendle is director of ‘envolve,’ formerly the Bath Environment Centre, which is one of the most active and innovative centres of this kind in the UK and with which ICE is pleased to have a productive relationship. So this is a good example of ‘town–gown’ cooperation evolving into practice.

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Part I Understanding the Environment


1 Some Interdisciplinary Perspectives on Environmental Appraisal and Valuation Geoffrey P. Hammond and Adrian B. Winnett

Summary Techniques of environmental appraisal and valuation play an important role in the context of sustainability assessment. They are at the heart of methods for quantifying economic and social costs and benefits, as well as the direct ecological impacts that are an inevitable side-effect of material ‘progress’. Concepts such as the physical life-cycle of products and processes, and the need for clearly defined system boundaries, are key elements in environmental problem-solving. However some economists would claim that, as a ‘normative’ discipline, their methods can be extended to incorporate all of society’s environmental concerns. In contrast, engineers and environmental professionals have at times argued that economic techniques (such as cost–benefit analysis) may well obscure the impacts of different courses of action, and that decision-makers consequently become less well informed rather than the reverse. Aggregate decision criteria, for example, often conceal the weighing of various impacts. In contrast, the sort of ‘prescriptive’ tools for analysis that emanate from the engineering and physical sciences can provide alternative insights that complement those that spring from economics. These include thermodynamic (first and second law) analysis and environmental life-cycle assessment. A range of interrelated environmental project appraisal techniques is therefore examined in order to determine their relative merits. Practical examples are taken from the UK energy sector and from fluid power systems employing conventional mineral oil and biodegradable rapeseed oil. It is suggested that many of the environmental appraisal methods can play an important 3

4 Some Interdisciplinary Perspectives

evaluative role as part of an interdisciplinary tool kit within a general systems framework. Nevertheless, caution needs to be used when adopting economic and engineering analysis techniques so as to ensure that they are fit for their sustainability purpose.

Introduction Background In the aftermath of the Rio Earth Summit in 1992 there has been a heightened awareness of environmental issues worldwide, and in particular of the need to achieve sustainable development. The notion of sustainability was given further prominence in the context of the 2002 World Summit on Sustainable Development (the Rio + 10 review conference) held in Johannesburg. These concerns have filtered down to the design domain as it has become recognized that devising products and processes with a low environmental impact over their whole life-cycle is preferable to cleaning up during and after operation. The need to appraise the environmental consequences of a modern economy is necessarily at the heart of attempts to attain a sustainable world. These are encapsulated in methods for quantifying economic and social costs and benefits, as well as the direct ecological impacts that are an inevitable side-effect of material ‘progress’ (Hammond, 2000a). It is therefore unsurprising that methods of appraisal have proliferated over the last few decades. These seek to determine the magnitude of emissions and their impact on the biosphere in both physical and monetary terms. But they apply to different geographic (local, regional or global) scales and elements of the biosphere, such as land, sea and atmosphere. Techniques of environmental appraisal and valuation play an important role in the context of sustainability assessment. Some economists would claim that, as a ‘normative’ discipline, their methods can be extended to incorporate all of society’s environmental concerns. In contrast, engineers and environmental professionals have at times argued (for example, Hammond, 2000a; Hammond and Stapleton, 2001) that economic techniques, such as cost–benefit analysis, may well obscure the impacts of different courses of action. Decision-makers consequently become less well informed rather than the reverse. This is because aggregate decision criteria, for example, often conceal the weighing of various impacts. In contrast, the sort of ‘prescriptive’ tools for analysis that emanate from the engineering and physical sciences can provide alternative insights that complement those that spring from economics.

Geoffrey P. Hammond and Adrian B. Winnett 5

The issues considered In the present paper a range of interrelated environmental appraisal techniques are examined in order to determine their relative merits for sustainability assessment purposes. These include thermodynamic (firstand second-law) analysis and environmental life-cycle assessment, as well as various valuation methods that are presently employed in cost– benefit analysis. The focus is on environmental valuation methods and parameters that can be applied to project or plant appraisal. Practical examples are taken from the UK energy system and from fluid power systems employing conventional mineral oil and biodegradable rapeseed oil. It is suggested that several of the alternative evaluation techniques could play an important role as part of an interdisciplinary appraisal toolkit within a general systems framework. Nevertheless, caution needs to be used when adopting economic and engineering analysis techniques so as to ensure that they ‘are fit for their sustainability purpose’.

Sustainability as a modern paradigm Over a period of some fifteen to twenty years, the international community has been grappling with the task of defining the concept of ‘sustainable development’. It came to prominence as a result of the so-called Brundtland Report, published in 1987 under the title ‘Our Common Future’ and the outcome of four years of study and debate by the World Commission on Environment and Development (WCED, 1987) led by the former prime minister of Norway, Gro Harlem Brundtland. This commission argued that the time had come to couple economy and ecology, so that the wider community would take responsibility for both the causes and the consequences of environmental damage. It consequently viewed sustainable development as balancing economic and social development with environmental protection. This new paradigm was given an even higher profile in the context of the 2002 Johannesburg World Summit on Sustainable Development, which adopted the strapline ‘People, Planet, Prosperity’, essentially what Parkin (2000) and others call the ‘triple bottom line’. The WCED regard the concept as involving a strong element of intergenerational ethics. It defined sustainable development as a meeting ‘the needs of the present without compromising the ability of future generations to meet their own needs’. This was popularized by John Gummer, former UK secretary of state for the environment (1993–7), who encapsulated the idea in the popular phrase ‘don’t cheat on your children’ (Parkin, 2000).


Both Sara Parkin (2000) and Jonathan Porritt (2000) have stressed that sustainable development is only a process or journey towards a destination, which is ‘sustainability’. The end-game cannot easily be defined from a scientific perspective, although Porritt argues that the attainment of sustainability can be measured against a set of four ‘system conditions’. He draws these from ‘The Natural Step’ (TNS), an initiative by the Swedish cancer specialist Karl-Henrick Robèrt. They put severe constraints on economic development, and may therefore be viewed as being utopian (Hammond, 2001). One of the system conditions, for example, suggests that finite materials (including fossil fuels) should not be extracted at a faster rate than they can be redeposited in the earth’s crust. This contrasts with the present rapid rate of fossil fuel exhausion on the global scale: 20–40 years for oil, 40–70 years for natural gas, and 80–240 years for coal (Hammond, 2000b). TNS certainly implies that the ultimate goal of sustainability is rather a long way off when compared with the present conditions on the planet. Parkin (2000) suggests 2050–2100 or beyond.

From neoclassical to environmental economics The limits to microeconomic analysis In the neoclassical study of economics, the system studied is built up from the actions of individual economic agents such as firms and households. This is a system that may well be suboptimal, in some sense, in natural resource and environmental terms (Chapman, 1976). The transactions between these agents and the rest of the world are economically described in terms of the quantities and prices of the commodities exchanged. Prices in this economic model are supposed to reflect the ‘value’ that society places on an economic good. Thus, economics is claimed to be a ‘normative’ discipline: it suggests the optimal course of action to be taken in the allocation of resources. For the price of commodities to give information that will lead to an efficient use of resources, it is necessary to assume that the prices are determined in complete and perfectly competitive markets which equilibrate supplies and demands. Thus neoclassical economics is, first, personcentred – it is solely the values attributed by economic agents that count – and, second, it uses a particular form of aggregation to describe the outcomes of those actions – the competitive prices at which exchange takes place. Since those prices properly reflect the individual valuations which people have and since those valuations are all that


counts, powerful normative conclusions follow. It is important to keep a firm grasp on this point, which is both the strength and the weakness of neoclassical economics. Many critics misunderstand it and look for weaknesses that are not there to be found, rather than those which really matter. Obviously there may be imperfections in the structure of the market; for example, ‘externalities’ (such as pollution or waste disposal costs), for which no market exists, might be present. There are also likely to be uncertainties about the future, restricted information about technological possibilities and time-lags, all of which might cause prices to deviate from those which would lead to optimal investment decisions (Chapman, 1976; Hammond, 2000a).

Environmental economics Over the past twenty years or so, environmental economics has moved from being a fringe activity to become one of the most fertile fields of economic research. It is now a major, even dominating, influence within significant areas of policy debate, including global issues such as climate change and biodiversity loss. Mainstream environmental economics is influenced primarily by the neoclassical paradigm in the ways in which it formulates and analyses the two key issues of concern: the valuation of environmental assets and the design of policy instruments to manage those assets. In some respects environmental economics represents an extreme application of the neoclassical paradigm, with its belief in the possibility of extending individual valuations to all sorts of non-marketed ‘commodities’. Here environmental problems are essentially defined as flowing from ‘market failures’, and incentive-based policy instruments are advocated to correct such failures with efficacy. In the neoclassical view, environmental problems are just one species of externality and are to be costed at the price which an efficient market would impute to them: they would not exist if markets were complete and in equilibrium. This seems to fail, in the eyes of many environmentalist critics, in some sense, to grasp the real existence of environmental problems independent of their specification in an economic model. They argue that it might be a reason for adopting one of the alternative accounts of what may be called environmentally embedded sustainability in order to clearly define the nature of such problems. In many, perhaps most, of the cases which are of interest to environmental economists, there are no observable or even imputable prices of any sort to use in such valuations. The various methods that have been proposed for valuing external costs and benefits are all open to criticism


(see, for example, Jorgensen, 2003; Maddison, 1999; Stirling, 1997, 1998). Choice of different valuation methods can lead to a wide variation in the supposed costs and benefits. This valuation process is uncertain and potentially controversial, often relying on the determination of shadow prices. In the extreme, the results are in methods for valuing human life and well-being that are quite at odds with that perceived by the individual or by society as a whole (Burrows et al., 1998). Similar difficulties arise in valuing other elements of the biosphere. One procedure widely adopted is to invoke the so-called ‘contingent valuation method’ (see, for example, Jorgensen, 2003), eliciting prices by questioning people about their ‘willingness to pay’ (WTP) for environmental benefits or accept losses. However, the answers given in contingent valuation surveys could represent an attempt by respondents to formulate a response based on prices that people know in their everyday economic lives (Winnett, 2003a) rather than a properly formulated response based on the nature of environmental assets. Partly owing to its faith in the neoclassical paradigm and partly because of the necessary interface between environmental economics and the natural sciences, mainstream environmental economics has not been without its critics. Some of this criticism is simply misplaced (for example, that it cannot account properly for the life-cycle of products), and is easily rebutted by any well-trained neoclassical economist. But some is fundamental. This is especially true of those critics who challenge the foundations of neoclassical approaches to the environment. The same goes for those proposals for alternative accounts of sustainability based on physical or natural processes intrinsic to the biosphere, such as energy usage (Georgescu-Roegen, 1971) or biological resilience (Common and Perrings, 1992). Some of these accounts aspire to create an entirely new form of economics based, for example, on a redefinition of the concept of scarcity or value.

Cost–benefit analysis as a tool for environmental valuation The idea that prices reflect economic value, in a very broad sense, has been extended to the broader sphere of public-sector economics. This has led to the development of the techniques of cost–benefit analysis (Dorfman and Dorfman, 1993) for the assessment of public works projects. It now provides an important input into the evaluation of many projects that have significant impacts on the environment. These techniques play a major role in assessing new projects, for example, in the transport sector (Maddison et al., 1996), including road schemes and airport runways. In such cases it is necessary to internalize some of the


costs and benefits that might otherwise be viewed as being external to the market. This valuation process is uncertain and potentially controversial, often relying on the determination of shadow prices. It is indisputable that many environmental problems, however defined, involve extended time horizons and great uncertainty. In mainstream environmental economics, time is routinely dealt with by discounting. The costs and benefits in monetary terms are progressively discounted for future years in order to allow for the ‘time value of money’. This is a source of much criticism from environmentalists, for familiar practical and ethical reasons (see, for example, Broome, 1992). Ultimately, the application of cost–benefit analysis (CBA) results in the determination of a single decision criterion – typically the net present value (NPV) over the project life, the corresponding discounted cost–benefit ratio, or some related parameter. In dealing with risk, standard environmental economics generally assumes a world of calculable probabilities. Thus, a probability distribution for the decision criterion, such as the discounted cost–benefit ratio, is obtained if uncertainty is explicitly taken into account. There is no reason to think that the discount rate at which firms and consumers actually discount the future represents that rate at which society as a whole should discount it. Society as a whole may put a higher value on future resources than individuals and firms do. The latter will tend to consume natural resources faster than is warranted by society as a whole. Indeed, it may be argued that, in the case of a depleting natural resource (such as fossil fuels or uranium), perhaps a zero or even negative discount rate is appropriate (Munby, 1976). However, these have not, in practice, been used. It is certainly clear that discounted CBA techniques do not adequately reflect the resource depletion problem, at least as long as resource prices reflect mainly short-term trends. Nonetheless, the evaluation of social and environmental costs is obviously useful in identifying where the market has failed to internalize them. This provides governments with an indication of those areas in which action needs to be taken by way of the introduction of economic instruments (such as ‘green’ taxes and emissions permits) that can offset market deficiencies. Some of the more ardent advocates of CBA techniques for evaluating new projects with significant environmental impacts imply that they can be used as the sole method of assessment. There are a number of reasons for discouraging such an approach. First, the various methods for valuing external costs and benefits are all open to criticism (Maddison, 1999; Stirling, 1997, 1998). The


second, and arguably more important, reason for discouraging the sole use of CBA techniques is that they obscure rather than highlight the range of impacts that may emanate from a given project. Decision-makers are presented with a single decision criterion (such as the discounted cost–benefit ratio), which actually hides many disparate environmental impacts. It is vitally important that the implications of these impacts are faced, particularly by politicians, rather than obscured by the methodology (see, for example, Hammond, 2000a; Stirling, 1997, 1998).

Sustainability and economic thought The concept of ‘sustainability’ is regarded by many economists as a highly debatable notion. Its status within neoclassical environmental economics is not entirely clear: it is essentially a side-condition, rather than intrinsic to the logic of the model. At all events, the core of the concept is that some measure of welfare is bounded from below over time. This is often expressed in terms of maintaining an appropriate aggregate capital stock. Welfare is ultimately dependent on the return to stock. The capital stock is very broadly defined, to include natural resource and environmental assets, alongside physical, human, and even social capital. It should be noted that this framework is very widely used, even by those who are dismissive of neoclassical environmental economics. Indeed, one of the common (but mistaken) criticisms of environmental economics is that it does not use a comprehensive enough definition of capital. This needs to be distinguished from the argument that the market-based values utilized in aggregation are inappropriate. Many of the mainstream accounts of sustainability-as-maintainingaggregate-capital strengthen the criterion by requiring some individual components of the aggregate to be maintained as well. This is on the grounds that the weaker criterion overestimates the possibilities of substitution within the economy, though others are more sanguine. But introducing it as an assumption does raise questions about the coherence of the neoclassical model of sustainability, which do not seem to be very clearly appreciated. A little reflection will show that it implies that prices are not the efficient aggregators fundamental to the neoclassical paradigm (Winnett, 2003b). Economists are fond of arguing that prices are uniquely efficient descriptors and aggregators. If they are not, what are the alternatives? Is it possible to identify variables which provide, in some sense, environment-centred rather than person-centred descriptors and aggregators?


Thermodynamic perspectives and methods of analysis Energy in quantitative and qualitative terms In order to determine the primary energy inputs needed to produce a given amount of product or service, it is necessary to trace the flow of energy through the relevant industrial system. This idea is based on the first law of thermodynamics, that is the principle of the conservation of energy, or the notion of an energy balance applied to the system (Hammond, 2000a). It leads to the technique of first-law or ‘energy’ analysis, sometimes termed ‘fossil fuel accounting’, which was developed in the 1970s in the aftermath of the oil crisis (see, for example, Chapman, 1976; Roberts, 1978; Slesser, 1978). Analysis is performed over the entire life-cycle of the product or activity, ‘from cradle to grave’. Unlike economic analysis, it is ‘prescriptive’ and not ‘normative’; that is it will indicate the energy consequences of actions rather than suggest optimal courses for action. Energy analysis has been widely used by academics and UK government departments, including the Energy Technology Support Unit at Harwell. However, it needs to be employed with some care as neither the whole-life nor the ‘gross’ energy requirement (GER) may necessarily be the most appropriate criterion for assessing energy-related projects. It takes no account of the energy source in a thermodynamic sense. Electricity, for example, may be regarded as an energy carrier having a high quality, or exergy, because it can undertake work. In contrast, low-temperature hot water, although also an energy source, can be used only for heating purposes. Here the term ‘exergy’ signifies the maximum useful work obtainable from an energy system at a given state in a specified environment. This distinction between energy and exergy is very important when considering a switch, for example, from traditional internal-combustion engines to electric or hybrid vehicles. Thus, Hammond (2000a) has argued that it is important to employ exergy analysis based on the second law of thermodynamics (see, for example, Kotas, 1985; Szargut et al., 1988) alongside a traditional first-law energy analysis in order to illuminate these issues.

Energy analysis The system boundary in energy analysis should strictly encompass the energy resource in the ground (for example oil in the well or coal at the mine), although this is often taken as the national boundary in practice. Thus, the sum of all the outputs from this system multiplied by their individual energy requirements must therefore be equal to the sum of inputs multiplied by their individual requirement. The process


consequently implies the identification of feedback loops, such as the indirect, or ‘embodied’, energy requirements for materials and capital inputs. Different ‘levels of repression’ may be employed, depending on the extent to which feedback loops are accounted for or the degree of accuracy wanted (Slesser, 1978). The procedure leads to an estimate of the GER, sometimes loosely termed the primary energy ‘cost’. It can be used to determine the least energy-intensive industrial process from among a number of alternative options. The techniques of first-law analysis have been widely used since the first oil crisis of the early 1970s. There are several different methods of energy analysis, the principal ones being statistical analysis, input–output table analysis and process analysis (Chapman, 1976; Roberts, 1978; Slesser, 1978). The first method is limited by available statistical data for the whole economy or a particular industry, as well as the level of its disaggregation. Statistical analysis often provides a reasonable estimate of the primary energy cost of products classified by industry. However, it cannot account for indirect energy requirements or distinguish between the different outputs from the same industry (Roberts, 1978). The technique of input–output table analysis, originally developed by economists, can also be utilized to determine indirect energy inputs and thereby to provide a much better estimate of the GER. This approach is limited only by the level of disaggregation that is available in national input–output tables. Process energy analysis is the most detailed of the methods, and is usually applied to a particular process or industry. It requires process flow charting using conventions originally adopted by the International Federation of Institutes of Advanced Studies in 1974–5 (Chapman, 1976; Roberts, 1978; and Slesser, 1978). The application domains of these various methods overlap.

Exergy analysis First-law energy analysis as described above enables energy or heat losses to be estimated but gives no information about the optimal conversion of energy. In contrast, the second law of thermodynamics shows that not all the energy input into a system can be converted into useful work. It therefore provides the basis for the definition of parameters that facilitate the assessment of the maximum amount of work achievable in a given system with different energy sources (Hammond and Stapleton, 2001). Exergy is the energy available for conversion from a donating source with reference to a specified datum, usually the ambient environmental conditions (typically 1 bar and 5–25 °C). In a sense it


represents the thermodynamic ‘quality’ of an energy carrier, and that of the waste heat or energy lost in the reject stream. The delivered exergy of an energy resource represents its capacity to cause change. This quantity, or its close relatives, have been given a variety of names in the literature, including availability, available energy, available work and essergy (Hammond and Stapleton, 2001). Exergy was coined by Rant (1956) and has been widely adopted over the last couple of decades. Second-law or exergy analysis is the only way of determining where the thermodynamic quality of an energy vector is lost in processes or in society. It provides a basis for defining an exergy efficiency and can identify the ‘improvement potential’ within a given system. The use of the exergy method of analysis has grown rapidly since the mid-1970s, particularly for optimizing individual energy conversion systems and process plant. Van Gool (1997) cited the example of a gas boiler plant for space heating, which is normally regarded as having quite a high energy efficiency but is found to have a very low secondlaw or exergy efficiency. More recently it has been applied to examine the overall performance of national energy systems. Van Gool (1997) illustrated the technique by reference to a hypothetical country, that he amusingly called ‘Otherlands’, while others (see Hammond and Stapleton, 2001) applied it to the USA, Sweden, Japan, Canada, Turkey and the United Kingdom. Notwithstanding these developments, exergy analysis has not been formally codified in quite the way that its firstlaw counterpart was in 1974–5.

Environmental life-cycle assessment Gestation It is now widely recognized that in order to evaluate the environmental consequences of a product or activity the impact resulting from each stage of its life-cycle must be considered. This has led to the development of a range of analytical techniques that now come under the umbrella of lifecycle assessment (LCA). Along with other environmental management tools, LCA is becoming more widely adopted in the context of international environmental regulations, for example those associated with eco-labelling. For a full LCA, the energy and materials used, and pollutants or wastes released into the environment as a consequence of a product or activity, are quantified over the whole life-cycle, ‘from cradle-to-grave’ (Graedel and Allenby, 1995). LCA underpins the process of environmentally sensitive design, or ‘eco-design’, that has very largely focused to date on products.


The methodology of LCA follows closely that developed for energy analysis (Hammond, 2000a), but evaluates the environmental burdens associated with a product or process over its whole life-cycle. This requires the determination of a balance or budget for raw materials (outputs) emanating from the system. Energy is treated concurrently, thereby obviating the need for a separate energy analysis. LCA is a product or system-based form of environmental auditing which is often geographically diverse; that is, the material inputs to a product may be drawn from any continent. Until recently there has been a lack of consensus on the best approach to LCA and consequently practitioners have to some extent developed their own methodology. This has allowed a great deal of subjectivity to be developed in some studies. Only relatively recently has the methodology of LCA been codified under the auspices of the Society of Environmental Toxicology and Chemistry (SETAC) at a series of workshops in the early 1990s (Graedel and Allenby, 1995). In the USA it is sometimes referred to as ‘resource and environmental profile analysis’, or REPA (Canter, 1996). SETAC (1991 and subsequent publications) has largely defined the standard framework and this forms the basis of the ISO 14040 series.

Methodology The aim of the LCA is to identify opportunities for environmental improvement by detecting the areas with the most significant impacts. This improvement potential can then be examined as part of the design process. SETAC (1991) has established a framework for LCA comprising four main stages. These are illustrated schematically in Figure 1.1, where it is shown to follow a logical sequence of goal definition and scoping, inventory analysis, impact assessment and recommendations for improvement. There are many technical issues that need to be addressed during the conduct of life-cycle assessment (and about which Ayres, 1995 and Lee et al., 1995 have been particularly critical). These include the definition of system boundaries, the quality of data available and the way the results are normalized (Hammond, 2000a). The goal definition process is very important as part of the planning stage for an LCA study. Gathering data for the inventory can be a time-consuming task, as many companies either see such data as confidential or simply do not have the sort of detailed records needed for a credible whole-life study. The impact assessment is still undergoing refinement; the concepts employed in the SETAC methodology have been largely incorporated


Goal definition Used to define the system boundaries, purpose and functional unit of a study.

Inventory Data gathered and stored in a spreadsheet format.

Impact assessment The impact is assessed through three sub divisions. Classification Aggregates data into separate areas, e.g. resource depletion, ozone gases and greenhouse gases.

Valuation Assigns relative values or weights to impacts in order to facilitate comparisons – is subjective.

Characterisation Quantifies the relative contributions each make to environmental problems, e.g. global warming potential.

Improvement assessment Incorporates the results into applications for product design, eco-labelling, policy formation etc. Figure 1.1 Schematic representation of the SETAC life-cycle assessment methodology. Source: Burrows et al. (1998).

in the ISO 14040 standards. Three elements of the impact assessment stage are indicated in Figure 1.1. Life-cycle assessment is still very much in the development phase, in both Europe and North America. The process of tracing the life-cycle


environmental impact of a product or activity is complicated. It is greatly assisted by the use of spreadsheet programs, and several specialpurpose software packages have become commercially available. Rice et al. (1997) recently undertook a review of the twelve main packages available in Europe. These were assessed in terms of a range of criteria, including the volume and quantity of data, evaluation methods for impact assessment, burdens allocation, software engineering practices and cost. On the basis of this comparison, Rice et al. concluded that only four of these packages were serious ‘players’ as environmental management tools. McManus et al. (1999a, 2003) used an updated version of one of the four recommended tools, namely SimaPro 4.0. It is a commercial package developed from that originally reported by Heijings et al. (1992) (see also Guinee et al., 1993a,b for related product– oriented LCA work at CML, Leiden University, the Netherlands), then known as version SimaPro 1.0. This choice had no particular significance, as any of the four packages recommended by Rice et al. would have been suitable. In terms of the LCA stages illustrated in Figure 1.1, the software has been used mainly as part of the inventory stage, although supplemented by specific data on the materials content and embodied energy related to the particular applications considered here.

Critics and critisms Thermodynamic approaches and limits First- and second-law thermodynamic analysis tools have recently been employed by Hammond (1998) and Hammond and Stapleton (2001) respectively to examine the performance of the UK energy sector. This was achieved by disaggregating the economy on a broad sectoral or ‘macroscale’ basis. The particular characteristics of each sector were then utilized in order to estimate sector-weighted or ‘lumped’ parameters, such as averaged energy and exergy efficiencies. These indicators were employed to determine the exergetic ‘improvement potential’ in the main sectors. Hammond and Stapleton (2001) found that, for the United Kingdom in the late 1990s, final demand in the domestic and transport sectors, together with electricity generation, accounted for nearly 80 per cent of second-law improvement potential. Figure 1.2 brings together their results for all the sectors evaluated here, and it suggests a rank order for action. In order to achieve efficiency gains, it will be necessary to focus attention principally on making better use of space heating systems, improving the operating efficiency of ‘power’


Peta joules, PJ = 1015J 1600

Electricity generation

1400 1200 Domestic sector

1000 800

Transport sector

Industrial sector

600 400

Service sector

200 0 1965

UK sectoral improvement potential 1970

1975

1980

1985

1990

1995

2000

2005

Year Figure 1.2

Exergetic improvement potential of the UK energy system

Source: Hammond and Stapleton (2001).

plant and reducing thermodynamic losses in transportation systems that are presently dependent on IC engines. The background studies on energy efficiency and energy productivity prepared for the 2002 UK Energy Review (Eyre, 2002; PIU, 2002) suggest that the thermodynamic findings of Hammond and Stapleton (2001) represent the maximum theoretical improvement, or energy-saving, potential. However, Jaffe and Stavins (1994) rightly draw a distinction between such an optimum and what can be feasibly achieved in practice. This is illustrated schematically in Figure 1.3, which depicts the economic and technical barriers (as well as the thermodynamic limits) that must be faced in securing energy efficiency savings in practice (see also Lozano and Valero, 1993). Roughly this implies that, although the thermodynamic (or exergetic) improvement potential is around 80 per cent in line with the findings of Hammond and Stapleton (2001), only about 50 per cent of energy currently used could be saved by technical means, and when economic barriers are taken into account this reduces to perhaps some 30 per cent. Notwithstanding this, the PIU team still argued that the current level of energy services could be secured using just 20 per cent of the energy used at present; something that suggests very great scope for innovation in energy efficiency over the longer term.

18 Some Interdisciplinary Perspectives % 100 Economic potential

80 60 40

Technical potential Thermodynamic potential

Existing energy use

20 0 Energy-saving potential Figure 1.3

The energy efficiency gap between theory and practice

Source: Adapted from Jaffe and Stavins (1994); Eyre (2002).

Hammond (2000a) recently advocated the use of exergy analysis as one tool among several quantitative approaches that should be employed to study energy systems. Others include traditional first-law energy analysis, environmental life-cycle assessment and cost–benefit analysis (CBA). All have their own particular advantages and disadvantages (outlined by Hammond, 2000a). However, there is a tendency for some thermodynamicists to elevate second-law analysis to a pivotal position. Gaggioli (1980), for example, viewed exergy as representing thermodynamic ‘value’ and regarded the second-law efficiency as the true efficiency. This is in effect to postulate an ‘exergy theory of value’, analogous to the ‘monetary theory of value’ in economics (Hammond, 2000a). This is not warranted and should be discouraged.

Physically speaking: life-cycle emissions and wastes Environmental life-cycle assessment (LCA) has recently been employed to compare the ecological impact of alternative fluid power systems using either mineral oils or rapeseed oils (see Burrows et al., 1998; McManus et al., 1999a,b; McManus, 2001). One application they examined was the adoption of such oils for the hydraulic systems used in forestry machinery (such as logging harvesters and forwarders). This is clearly a very sensitive application from an ecological perspective. A full account of this case-study has been reported by Burrows et al. (1998) and, more recently, by McManus et al. (1999a,b, 2003). The production and use of


mineral and rapeseed oil was obviously examined in some detail. However, the disposal process for both oils is currently the same, and so will have no differential impact for the purposes of the LCA study. Data availability and ‘quality’ was a significant problem in this case, although every effort has been made to obtain realistic inputs. Consequently the degree of uncertainty is still quite high. The results will be refined over time as more and better data is obtained. A detailed ‘sensitivity analysis’ was carried out by McManus (2001) in order to determine areas of high sensitivity (see also the comments below). The LCA results presented in Figure 1.4 show that overall the rapeseed oil has a greater impact on the environment than does the mineral oil. These results are updated from those originally reported by Burrows et al. (1998) and take account of better data on the processing of rapeseed oil. The impact of the rapeseed is greater than that of the mineral oil in all categories examined, other than energy use and winter smog. However, if other issues had been examined, such as vehicle fuel use, then the overall results may look rather different; the magnitude of the variation would be scaled down. Rapeseed fluids do not have the same properties as mineral fluids, and therefore their thermal performance

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Figure 1.4 Normalized comparison of a fluid power system using mineral and rapeseed oils (over a fifteen-year life-cycle) Source: McManus et al. (1999a).


within a fluid power system is relatively poor. At present, with current specifications for hydraulic oil systems, this means that fluids based on rapeseed have to be replaced more frequently than those based on mineral fluids. This will obviously exacerbate the adverse impacts resulting from the production process. LCA results of this sort enable improvement strategies to be developed for any of the life-cycle stages. Those that exhibit large environmental impacts can be further analysed to see if there are any other ways to improve the product or system. Examination of fertilizer production or the rapeseed crushing stage, for example, may indicate whether there are ways to easily improve these processes. However, as the growth of rapeseed is a natural process, it will be very difficult to improve that element of rapeseed production. Once the stages with the larger impacts have been analysed then it is important to look at the stages which, examined together, could have a significant effect on the overall performance (McManus et al., 1999a; McManus, 2001). The way in which LCA can identify such contributions and stages is invaluable, and helps to make it a comprehensive environmental management tool. The results of any LCA study may prove to be very uncertain or sensitive to small changes in input data. It is therefore desirable to undertake a sensitivity analysis in order to reduce the uncertainty in the outputs (see, for example, McManus et al., 1999a; McManus, 2001). This involves employing a systematic procedure to evaluate the effect of changes in key variables. If a small change in some item of input data gives rise to a large change in the resulting life-cycle impact of the product or system being studied, then the LCA is very sensitive to errors or uncertainties in the estimates for that variable. LCA is a very useful approach and set of techniques, but it has many limitations at its present state of development (McManus et al., 1999a, Molloy, 2003). The methods employed allow only for the examination of global and regional impacts, and not local impacts. This can obviously bias results. The LCA study of forestry machinery by Burrows et al. (1998) and McManus et al. (1999a,b, 2003) accounted only for global and regional impacts. Local ecological damage caused by oil spills on the forest floor could not be incorporated into the methodology. However, as long as there are complementary studies carried out which do take into consideration local impacts, then LCA can still be used to good effect. One of the major limitations to LCA is time and data. To undertake a full LCA study requires a vast amount of data, much of which is not within the public domain. Companies are often unwilling to


part with the sort of sensitive data required for a full study (McManus et al., 1999a). The use of more generalized public domain data or estimates obviously decreases the accuracy of the study. Credible databases are becoming available with the rise in popularity of LCA, and these can be purchased either as a commercial database or as part of a software package. There has been a call by the Society for Promotion of LifeCycle Development (SPOLD) for all LCA databases to be in the same format, thereby making data transfer easier. This is taking place to some extent, but the use of LCA is still too limited to enable a practitioner to find all the information needed from a public database. Consequently a lot of time is still invested in gathering input data (McManus et al., 1999a). The initial stages of LCA, those related to scoping and inventory analysis, can be regarded as well defined and understood. However, the later stages, including the processes of normalization and valuation, are subjective, and many different methods are in current use. This leads to inevitable problems when the results of impact assessments are interpreted. Nevertheless, the use of LCA is still one of the more scientific environmental management tools. Clearly much more research is needed to refine LCA methods and to make them more robust (McManus et al., 1999a). It is critically important that LCA studies are peer-reviewed. This is normally undertaken as part of the refereeing process when the results of studies are submitted for publication in the scientific and technical media. Unfortunately, many industrial studies are not subject to a similar level of rigorous evaluation. There is consequently a need for Government departments and agencies with an interest in the application of LCA techniques over a range of products and systems to establish a ‘college of peers’ for this purpose (McManus et al., 1999a). This could have a very real and near-term effect on improving the reliability of LCA studies. Commercial LCA software or databases are becoming more readily available. They offer facilities that reduce the barriers for the entry of non-specialists. Access to public domain databases will also reduce the time required to perform an individual study, although it will remain significant in the near term. However, it will still not be a simple task to perform a full LCA, and the expertise and time needed to undertake a rigorous, whole-life environmental impact assessment must be recognized. There has been much discussion in the industrially focused literature about the need to devise short-cut or simplified methods of LCA. Given that full LCA studies are still rather in their infancy, and have a number of limitations, McManus et al. (1999a) have argued that these


developments should be discouraged. They are likely to produce misleading results and, as a consequence, damage the credibility of carefully prepared assessments.

Monetary valuation of environmental burdens A range of techniques for the monetary valuation of environmental externalities have been developed over the last few decades (see, for example, Jorgensen (2003), Maddison (1999), Pearce (1999) and Stirling (1997, 1998)). These might be viewed as indicating the rude health of cost–benefit analysis, but it also suggests potential weaknesses. A number of studies have recently been undertaken that demonstrate the wide variety of results that can be obtained via CBA depending on the details of the methods employed. Two examples will be used here to illustrate the problems: the externalities associated with electricity generation from different fossil fuel resources (Maddison, 1999), and the environmental costs of bio-oils (Wightman et al., 1999). Arguably one of the most extensive CBA studies to be undertaken in recent years has been the European Union’s ExternE project aimed at assessing the full cost of electricity generation and other energy options (European Commission DG XII 1995). This multinational, collaborative project was instigated with the aim of developing a framework that would enable the calculation of the marginal external costs and benefit for different power plant technologies at specific sites. It started as a joint venture between the Commission and the US Department of Energy. In this Phase 1 the conceptual approach and methodology was jointly devised for application to several illustrative fuel cycles. The EU then took forward the project into two further phases, first applying the methodology to a wide range of power generation and energy conservation options and then using the accounting framework to support EU-level policy development and decision-making. The ExternE project claimed to be a major advance in terms of generating a transparent basis on which various technologies, plant locations and resulting impacts could be compared and contrasted (European Commission DG XII 1995). It set out to trace impact pathways for pollutants (or other environmental burdens) from the plant location to the receptor site where the final impact would be felt. This necessitated the quantification of plant emissions, the modelling of their dispersion and finally the determination of a number of dose–response functions at the receptor site. These ‘whole-life’ or ‘full-fuel-cycle’ impacts were then employed as the inputs from which the monetary valuation of environmental damage was assessed. Here attempts were made to


quantify people’s WTP for environmental improvement over and above the anticipated damage. The three alternative means for determining the so-called ‘value of a statistical life’ (VOSL) in the ExternE study were labour market analyses, contingent valuation studies (of the sort discussed by Jorgensen, 2003) and market-based analyses. Various assumptions made while quantifying environmental damage in monetary terms have been the subject of controversy among economists. Part of the ExternE methodology, for example, involved the estimation of acute mortality resulting from environmental effects of electricity generation. Maddison (1999) has argued that these were exaggerated by a factor of three. In addition, almost all of the deaths were presumed to occur in the over-65 age range, which should be valued differently from the deaths of younger people. Accidents at work were included as external costs, whereas Maddison (1999) has noted that these would already have been internalized via market mechanisms. The ExternE estimates, therefore, ‘double accounts’ for their contribution. Finally, the climate change impacts were greatly over-estimated owing to the adoption of a zero discount rate: future events were valued as if they occurred today. Unfortunately, the climate change costs turned out to be quite a large fraction of the total economic damage in the case of electricity generation from fossil fuel resources (Maddison, 1999). Maddison (1999) set out to revise the ExternE estimates for the external costs of electricity generation from fossil fuels to take account of the deficiencies he identified. For this purpose he used lower estimates of the health risks from PM10s and a lower estimate for the VOSL corresponding to deaths attributable to air pollution, while occupational accidents and health risks were excluded and a 3 per cent discount rate applied to future climate change impacts. The revised estimates are presented in Table 1.1. Maddison’s changes (1999), which he acknowledges are likely to be subject to further revision, have the effect of reducing the external costs by between two-thirds and four-fifths. Stirling (1998) produced, from a perspective grounded in risk analysis, a critical review of what he termed the ‘first-generation’ studies aimed at the monetary valuation of environmental impacts associated with electricity generation, including the ExternE project. He found that a wide range of external costs had been calculated from fourteen separate studies of different power plant types. They suggest cost variations from one to as much as five orders of magnitude in each case. This puts Maddison’s downward but modest (less than one order of magnitude) revision of the ExternE estimates into context. Stirling (1997, 1998) noted that the impetus for environmental cost–benefit analyses of this

24 Some Interdisciplinary Perspectives Table 1.1 Revised ExternE external cost estimates for electricity generated via the main fossil fuel cycles (million ECU/kWh) Occupational health and accidents

Frankhauser climate change impacts

Other external costs

Total

3.8 1.2

1.0 0.0

10.0 1.5

0.1 0.1

14.9 2.8

Coal (L) ExternE Revised

12.5 4.6

2.3 0.0

10.0 1.5

0.2 0.2

25.0 6.3

Lignite ExternE Revised

9.7 3.4

0.1 0.0

12.0 1.8

0.2 0.2

22.0 5.4

Oil (GT) ExternE Revised

11.4 4.0

0.5 0.0

8.0 1.2

0.4 0.4

20.3 5.6

Oil (CC) ExternE Revised

10.4 3.8

0.3 0.0

6.0 0.9

0.4 0.4

17.1 5.1

Gas ExternE Revised

0.5 0.2

0.1 0.0

4.0 0.6

0.1 0.1

4.7 0.9

Fuel cycle

Coal (WB) ExternE Revised

Public health effects of air pollution

WB, West Burton coal plant; L, Lauffen coal plant; CC, combined cycle; GT, gas turbine. Source: Maddison (1999).

sort stemmed from the recognition that neoclassical economic studies had failed to deal with environmental and other externalities adequately. However, he argued that attempts to rectify these deficiencies were misplaced, because they try to balance factors that involve political value judgements and not just technical factors. In his view such ‘technocratic’ approaches would lead to a situation whereby decision-making is delegated to a narrow community of specialists (‘experts’) based on methods that are inherently inaccurate or imprecise. In parallel with the environmental life-cycle assessment studies of bio-oils for mobile fluid power systems by Burrows et al. (1998) and McManus et al. (1999a, 2003) at the University of Bath, and described above, a separate interdisciplinary team from the Scottish Agricultural College in Aberdeen and the University of Reading undertook a comparative assessment of mineral and rapeseed (Wightman et al., 1999).


They combined cradle-to-grave LCA with CBA to yield both environmental impacts and estimates of their associated costs. Differences between the life-cycle inventories for rapeseed oil determined by Wightman et al. (1999) and that obtained by McManus et al. (1999a, 2003) were found to be due to the recognition by the latter that the performance of bio-oils is inferior to that of conventional mineral oils. Bio-oils degrade much more rapidly at the typical operating temperatures experienced in fluid power systems. Rapeseed oil consequently needs to be replaced between 1.5 and 3 times as frequently as its mineral oil counterpart, leading to significantly increased life-cycle emissions (see Figure 1.4). Wightman et al. employed CBA to provide monetary valuations of the impacts quantified via LCA. Total impacts for rapeseed oil were presented for a winter oilseed rape scenario (RO), while the marginal impacts were obtained by subtracting impacts associated with either winter wheat (WW) or set-aside (S/A). Monetary valuation of the environmental impacts were estimated by using four different valuation systems: the Tellus Institute method, the Swedish environmental priority strategies (EPS) enviro-accounting method, the multiple-pathway method (MPM) and a variant on the ExternE system (designated CAS after the Centre for Agricultural Strategy at Reading). Details of these valuation schemes (see Wightman et al., 1999) are not as important for the present purposes as the results obtained. These are summarized in Table 1.2, where it can be seen that the rapeseed oil hydraulic fluid had generally lower environmental costs than those of mineral oil. This is an artefact of the assumption about the characteristics of rapeseed oil, and would be reversed if the more realistic replacement schedule of McManus et al. (1999a, 2003) had been adopted. A crushing scenario using 70 per cent of oilseed rape, and therefore 30 per cent meal, replacing Table 1.2 Estimated environmental costs (£ sterling per Functional Unit) of hydraulic fluids Valuation system

Scenario 100% RO Mineral 70% RO 100% RO–WW 100% RO–S/A

Tellus EPS MPM CAS

77.62 10.91 163.02 91.76

134.80 170.38 157.26 81.51

£ per FU = pound sterling per functional unit Source: Wightman et al. (1999).

58.68 6.87 127.43 66.09

18.14 −44.15 19.76 11.49

75.45 8.90 160.15 89.11


winter wheat (that is, 70 per cent RO–WW) was regarded by Wightman et al. as the most appropriate. The wide variation in environmental costs illustrated by the estimates in Table 1.2 demonstrates again the frailty of the present generation of monetary valuation methods. The costs vary with functional unit (FU; defined as the volume of hydraulic fluid used in 10000 hours of operation of a mobile hydraulic excavator) from between about +£9 and +£160 for the 100 per cent RO–S/A crushing scenario in the worst case. A more realiztic crushing scenario (70 per cent RO) yielded costs between +£7 and +£127 per FU. These represent variations of over an order of magnitude, in line with the revisions to the original ExternE results for electricity generation by Maddison (1999) discussed above, rather than those of Stirling (1998) that indicate several orders of magnitude variations. Nevertheless, it still suggests that CBA has some way to develop before it can be viewed as a reliable assessment tool for decision-makers. Economists would seriously dispute some of the preceding arguments. In particular, they would argue that they, in effect, routinely use LCA as an input into their economic assessments – there is no inconsistency or even differentiation between the approaches at the pre-valuation stage (and at the valuation stage they have a uniquely efficient way of attributing weights) – and, second, that, in fact, LCA implicitly assumes a very specialized version of an input–output system whereas they would begin with a fully interactive model. (This is another way of looking at the system–boundary issue, though the authors have not seen it formulated in quite this way.) The response of many to these arguments is that they just go to show the hubris of economists.

‘Exergoeconomics’: joined-up thinking? The popularity of second-law or ‘exergy’ analysis in central Europe and North America from the 1980s onwards led to attempts to merge the technique with financial cost accounting. This arose because exergy began to be viewed as a measure of the true quality or value of energy carriers (Gaggioli, 1980; Tsatsaronis, 1993), notwithstanding the criticisms of Hammond (2000a) and Hammond and Stapleton (2001) outlined above. The combined approach with monetary costing has been described using various terms in the engineering literature: ‘exergy accounting’, ‘exergy costing’ or ‘exergoeconomics’ (see, for example, El-Sayed and Gaggioli, 1989; Lozano and Valero, 1993; Tsatsaronis, 1993). Although the term ‘thermoeconomics’ is often used for this purpose, it also encompasses the combination of first-law energy analysis with financial costing, sometimes called ‘heat economy’ (Tsatsaronis and Winhold, 1985).


The idea of exergy costing actually stretches back to the early 1930s, when Keenan (1932) implicitly suggested its use to apportion costs from the cogeneration of steam heating and power in systems termed ‘combined heat and power’ (CHP) schemes in Europe. (The history of exergoeconomics can be traced, for example, in El-Sayed and Gaggioli, 1989; Lozano and Valero, 1993; Tsatsaronis, 1993.) However, it was only in the 1980s and 1990s that exergy accounting procedures became formalized and more widely adopted. Exergoeconomics attributes unit costs to the exergy associated with each of the material and energy streams entering or leaving an engineering device, or its subsystems (Tsatsaronis and Winhold, 1985) – a procedure sometimes called the ‘cost formation process’ (Lozano and Valero, 1993). Exergy has been seen as providing a means for determining the sources of exergy losses, or ‘irreversibilities’, within thermal or chemical process plants. It is argued that the exergy function is closely related to the economic value of the carrier (Tsatsaronis, 1993), as users may be said to pay for the maximum useful work. Advocates assert that exergy destruction represents what the layperson views as ‘waste’ energy or heat (Tsatsaronis and Winhold, 1985). Its cost is hidden, but no less important for that. The monetary costs are therefore allocated to system irreversibilities, and these are compared with (annualized) capital and operating costs for individual ‘unit operations’. The mathematical formalism is provided within a general systems framework, and optimization then yields possibilities for design changes and improvement (Tsatsaronis and Winhold, 1985). This procedure makes product costs (those associated with both capital equipment and exergy losses in process flow streams) and fuel savings more visible. The various proposals to marry thermodynamic concepts with financial cost accounting represent attempts to couple what might be viewed as two incompatible disciplines. Economics claims to be ‘normative’, suggesting optimal courses of action, whereas thermodynamic analysis is ‘prescriptive’. Prices in economic markets are supposed to reflect value judgements, while exergy accounting deals only with essentially invariant ‘costs’. The system boundaries are also arguably different: microeconomic units (such as the factory or the firm) versus a cradle-tograve (or cradle-to-gate) system. Exergoeconomics may therefore be regarded as attempting to blend ‘chalk and cheese’. This is perhaps not surprising as the technique has been developed largely by specialist engineers and scientists talking among themselves. They have made little attempt to engage economists in a multidisciplinary discourse, or to publish the economics literature as well as the engineering one.


Unless this is rectified, it may well prove to be a dead end rather than a way forward.

Concluding remarks Techniques of environmental appraisal and valuation play an important role in the context of sustainability assessment. They are at the heart of methods for the quantifying economic and social costs and benefits, as well as the direct ecological impacts that are an inevitable side-effect of material ‘progress’. Concepts such as the life-cycle of products and processes, and the need for clearly defined system boundaries, are key elements in environmental problem-solving. Some economists would claim that, as a ‘normative’ discipline, their methods can be extended to incorporate all of society’s environmental concerns. In contrast, engineers and environmental professionals have at times argued that economic techniques (such as cost–benefit analysis) may well obscure the impacts of different courses of action, and that decision-makers consequently become less well informed rather than the reverse. Aggregate decision criteria, for example, often conceal the weighing of various impacts. They obscure rather than highlight the various impacts that may emanate from a given project. In any case, it has been suggested here that the various procedures for the monetary valuation of environmental burdens currently yield large disparities in external costs. The sort of ‘prescriptive’ tools for analysis that emanate from the engineering and physical sciences can often provide alternative insights that complement those that spring from economics. Thermodynamic concepts (such as energy, entropy and exergy) have been utilized by practitioners in a variety of disciplines with an interest in environmental sustainability, including ecology, economics and engineering. Widespread concern about resource depletion and environmental degradation is common to them all (Hammond, 2001). It has been argued that these consequences of human development are reflected in thermodynamic ideas and methods of analysis (see, for example, the early work of Mueller (1971) at the US Goddard Space Flight Center); they are said to mirror energy transformations within society. Mueller (1971) draws a parallel between the resource flows in economics and energy (as well as implicitly exergy) flows in thermodynamics. This leads him to an analogy arguably rather dubious, between the ‘technology of man’ and heat engines. Such ideas have inspired the environmental campaigner Sara Parkin (2000) (a co-founder with Jonathan Porritt) of the sustainable development charity Forum for the


Future and others to believe that thermodynamic principles or laws may act as a guide for engineers in the quest for environmental sustainability. Indeed, the concept of exergy is viewed as providing the basis of a tool for resource and/or emissions accounting even by some thermodynamicists (see, for example, Wall, 1997; Szargut et al., 1988; Dincer and Rosen, 1998). It is also seen as indicating natural limits on the attainment of sustainability (Sciubba, 1995). But these applications simply draw on analogy, and perhaps a metaphor, between one domain of study and another. Caution therefore needs to be used when seeking real-world insights for a more sustainable future. Several interrelated environmental appraisal techniques have been examined here in order to determine their relative merits. These include first- and second-law thermodynamic analysis, environmental life-cycle assessment (LCA), environmental cost–benefit analysis (CBA) and finally the technique known as ‘exergoeconomics’, or exergy costing. Such approaches are interrelated in the sense that life-cycle energy analysis was one of the precursors for LCA, and is typically performed in parallel with environmental appraisal in most modern LCA software packages. Although energy analysis enables the determination of a quantitative energy balance across an engineering system, exergy analysis is required in order to ascertain the ways in which the energy flows are qualitatively degraded. LCA is a very useful tool for determining global and regional impacts of a product or system ‘from the cradle to the grave’, but is currently unable to incorporate local impacts. However, it is possible that some means to achieve this will be forthcoming in the not-too-distant future. In any event, LCA avoids the examination of products on a snapshot basis, whereby only one part of the life-cycle is examined. When employed with other environmental management tools, such as risk assessment, it can form a comprehensive impact assessment package. Life-cycle assessment is also sometimes employed, as illustrated here for the case of fluid power systems, to estimate impact inventories that can then be coupled with CBA to yield their environmental costs. In an attempt to close the circle, proposals have been made to couple the results of exergy analysis with financial cost accounting, yielding the so-called exergoeconomic approach. It is suggested here that several of these appraisal techniques could play an important evaluative role as part of an interdisciplinary toolkit within a general systems framework. Nevertheless, caution needs to be used when adopting both economic and engineering analysis techniques so as to ensure that they are fit for their sustainability purpose. Indeed doubt has been cast here on the use of exergoeconomic analysis, which


attempts to merge two approaches that may be in large measure incompatible, or chalk and cheese.

Acknowledgements In the present work an attempt is made to address the issue of environmental valuation from an interdisciplinary perspective by an environmentally conscious engineer (GPH) and an environmental economist (ABW). We hope this dialogue, or struggle to understand differing insights, will aid others in coming to terms with some of the interrelated appraisal techniques that stem from scientific, engineering and social sciences disciplines. The first author’s research (GPH) on energy systems and environmental sustainability has been supported by research grants awarded by the UK Engineering and Physical Sciences Research Council (most recently under Grants GR/L02227 and GR/ L26858). He is grateful to his colleagues Professors Clifford Burrows (Mechanical Engineering) and Andrew Graves (Management), with whom he jointly held these awards. The research studies cited in the text on the environmental life-cycle assessment of bio-oils for fluid power systems were originally undertaken by Dr Marcelle McManus, now at Sheffield Hallam University. Finally, the authors wish to acknowledge the care with which Sarah Fuge prepared the typescript and Gill Green prepared the figures. The authors’ names appear alphabetically.

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Geoffrey P. Hammond and Adrian B. Winnett 31 El-Sayed, Y.M. and Gaggioli, R.A. (1989) ‘A critical review of Second Law costing methods – I: Background and algebraic procedures’, ASME Transactions: Journal of Energy Resources Technology, 111, 1–7. European Commission DG XII (1995) ExternE: Externalities of Energy, Vol. 1: Summary, EUR 16520 EN. Luxembourg: Office of Official Publications of the European Communities. Eyre, N. (2002) Energy Efficiency. Imperial College/Warwick Business School Seminar: ‘The Energy Review: Drivers Behind the Report’ (unpublished). London: Institution of Mechanical Engineers, 11 March. Gaggioli, R.A. (1980) Thermodynamics: Second Law Analysis. Washington, DC: American Chemical Society. Georgescu-Roegen, N. (1971) The Entropy Law and the Economic Process. Cambridge, MA: Harvard University Press. Graedel, T.E. and Allenby, B.R. (1995) Industrial Ecology. Englewood Cliffs, NJ: Prentice-Hall. Guinee, J.B., UdodeHaes, H.A., and Huppes, G. (1993a) ‘Quantitative Life-Cycle Assessment of Products 1: Goal Definition and Inventory’, Journal Cleaner Production, Vol. 1(1), pp. 3–13. Guinee, J.B., Heijungs, R., UdodeHaes, H.A., and Huppes, G. (1993b) ‘Quantitative Life-Cycle Assessment of Products 2: Classification, Valuation and Improvement Analysis’, Journal Cleaner Production, Vol. 1(2), pp. 81–91. Hammond, G.P. (1998) ‘Alternative energy strategies for the United Kingdom revisited: market competition and sustainability’, Technological Forecasting and Social Change, 59, 131–51. Hammond, G.P. (2000a) ‘Energy and the environment’, in A. Warhurst (ed.), Towards a Collaborative Environment Research Agenda: Challenges for Business and Society, pp. 139–78. Basingstoke: Macmillan. Hammond, G.P. (2000b) ‘Energy, environment and sustainable development: a UK perspective’, Trans IChemE Part B: Process Safety and Environmental Protection, 78, 304–23. Hammond, G.P. (2001) Engineering Sustainability: Energy Systems, Heat Transfer Processes and Thermodynamics Analysis, Invited Lecture: seventh UK National Heat Transfer Conference, Nottingham University, 11–12 September 2001, 32 pp. Hammond, G.P. and Stapleton, A.J. (2001) ‘Exergy analysis of the United Kingdom energy system’, Proceedings of the IMechE Part A: Journal of Power and Energy, 215, 141–62. Heijings, R. et al. (1992) Environmental Life-Cycle Assessment of Products – Guide and Background. The Netherlands: CML, Leiden University. Jaffe, A.B. and Stavins, R.N. (1994) ‘The energy efficiency gap: what does it mean?’, Energy Policy, 22(10), 804–11. Jorgensen, B.S. (2003) ‘Perceived justice and economic valuation of the environment: A role for fair decision-making procedures’, in A. Winnett and A. Warhurst (eds), Towards an Environment Research Agenda: A Second Selection of Papers, pp. 146–61. Basingstoke: Palgrave Macmillan. Keenan, J.H. (1932) ‘A steam chart for Second-Law analysis’, Mechanical Engineering, 54, 195–204. Kotas, T.J. (1985) The Exergy Method of Thermal Plant Analysis. London: Butterworth. Lozano, M.A. and Valero, A. (1993) ‘Theory of the exergetic cost’, Energy, 18(9), 939–60.

32 Some Interdisciplinary Perspectives Lee, J.J., O’Callaghan, P. and Allen, D. (1995) ‘Critical review of life-cycle analysis and assessment techniques and their application to commercial activities’, Resources, Conservation, and Recycling, 13, 37–56. Maddison, D. (1999) The Plausibility of the ExternE Estimates of the External Effects of Electricity Production, CSERGE Working Paper no. GEC 99–04. Centre for Social and Economic Research, University College London and University of East Anglia. Maddison, D., Pearce, D., Johansson, O., Calthrop, E., Litman, T. and Verhoef, E. (1996) Blueprint 5: The True Cost of Road Transport. London: Earthscan. McManus, M.C. (2001) Life-Cycle Assessment of Rapeseed and Mineral Oil Based Fluid Power Systems. PhD Thesis, University of Bath. McManus, M.C., Hammond, G.P. and Burrows, C.R. (1999a) ‘Life-cycle assessment of mobile hydraulic systems’, Proceedings IMechE Seminar S673: Environmental Impact of Fluid Power Systems, 4 November. London: IMechE. McManus, M.C., Hammond, G.P. and Burrows, C.R. (1999b) ‘Life-cycle assessment’, House of Lords Select Committee on Science and Technology, Written Evidence on Non-Food Crops, HL Paper no. 5-I, pp. 222–7. London: Stationery Office. McManus, M.C., Hammond, G.P. and Burrows, C.R. (2003) ‘Environmental lifecycle assessment to compare the use of mineral and rapeseed oil in mobile hydraulic systems’, Journal of Industrial Ecology: Special Issue on ‘Bio-based Materials’ (in press). Forthcoming. Molloy, E. (2003) ‘When is a spade not (only) a spade? When it’s an environmental management tool’, in A. Winnett and A. Warhurst (eds), Towards an Environment Research Agenda: A Second Selection of Papers, 127–45. Basingstoke: Palgrave Macmillan. Mueller, R.F. (1971) ‘Thermodynamics of environmental degradation’, Proceedings, Annual Meeting of the American Geophysical Union. Washington, DC. Munby, D.L. (1976) ‘Economics of resource use’, In I.M. Blair, B.D. Jones, and Van A.J. Horn (eds), Aspects of Energy Conversion. Oxford: Pergamon. Parkin, S. (2000) ‘Sustainable development: the concept and the practical challenge’, Proceedings of the Institution of Civil Engineers: Civil Engineering, 138, 3–8. Pearce, D.W. (1999) ‘Valuing the environment’, in Pearce, D.W. (ed), Economics and the Environment: Essays on Ecological Economics and Sustainable Development, pp. 13–33. Cheltenham: Elgar. PIU Performance and Innovation Unit (2002) The Energy Review. London: Cabinet Office. Porritt, J. (2000) Playing Safe: Science and the Environment. London: Thames and Hudson. Rant, Z. (1956) ‘Exergy, a new for “technical available work” ’ (in German), Forsch. Ingenieurweser, 22(1), 36–7. Rice, G., Clift, R. and Burns, R. (1997) ‘Life-Cycle Assessment software review – comparison of currently European LCA software’, Int J LCA, 2(1), pp. 53–9. Roberts, F. (1978) ‘The aims, methods and uses of energy accounting’, Applied Energy, 4, 199–217. Sciubba, E. (1995) ‘Modelling the energetic and exergetic self-sustainability of societies with different structures’, Transactions of the ASME: Journal of Energy Resources Technology, 177, 75–86.

Geoffrey P. Hammond and Adrian B. Winnett 33 SETAC (1991), A Technical Framework for Life-cycle Assessment. Washington, D.C.: Society of Environmental Toxicology and Chemistry. Slesser, M. (1978) Energy in the Economy. London: Macmillan. Stirling, A. (1997) ‘Limits to the value of external costs’, Energy Policy, 25(5), 517–40. Stirling, A. (1998) ‘Valuing the environmental impacts of electricity production: a critical review of some “first generation” studies’, Energy Sources, 20, 267–300. Szargut, J., Morris, D.R. and Steward, F.R. (1988) Exergy Analysis of Thermal, Chemical, and Metallurgical Processes. New York: Hemisphere. Tsatsaronis, G. (1993) ‘Thermoeconomic analysis and optimization of energy systems’, Progress in Energy and Combustion Science, 19, 227–37. Tsatsaronis, G. and Winhold, M. (1985) ‘Exergoeconomic analysis and evaluation of energy-conversion plants-I. A new general methodology’, Energy, 10(10), 69–80. Van Gool, W. (1997) ‘Energy policy: fairy tales and factualities’, In O.D.D. Soares, A. Martinsda Cruz, G.C. Pereira, I.M.R.T. Soapes, A.J.P.S. Reis (eds), Innovation and Technology – Strategies and Policies, pp. 93–105. Dordrecht: Kluwer. Wall, G. (1997) ‘Energy, society and morals’, Journal of Human Values, 3(2), 193–206. Wightman, P.S., Carruthers, S.P. and Walker, K.C. (1999) ‘Comparative life-cycle assessment and cost–benefit analysis of mineral and rapeseed oils’, Proceedings, IMechE Seminar S673: Environmental Impact of Fluid Power Systems, 4 November. London: Institution of Mechanical Engineers. Winnett, A. (2003a) ‘Environmental economics’, in J. King (ed.), The Elgar Companion to Post Keynesian Economics. Cheltenham: Elgar. Winnett, A. (2003b) ‘Natural capital: hard economics, soft metaphor’ (unpublished Economic and Social Research Council seminar paper available at http://www.lancs.ac.uk/fss/projects/ieppp/natural capital). World Commission on Environment and Development (WCED) (1987) Our Common Future. Oxford University Press.

2 Talking Environmental Imperatives to Death Alfred Moore

Summary How is it that the universal environmental imperative, the urge to save the world from ourselves, has so lost its purchase? What does this say about the nature of the environmental imperative itself, and what implications does this have for the way we understand and deal with issues of environmental risk in contemporary society? Why has this happened despite the fact that scientific and technological development is thought by most analysts to be a key force behind the rapid changes in our societies, and despite the fact that the conflicts and controversies surrounding environmental and other risks seem only to be rising? And what does this mean for the politics of the environment and risk more generally in the future? The view to be argued in this article is that an often underestimated conflict of values lies behind the great divergences in attitudes to environmental and health risks, both within and between societies, and between and even within individuals. I will argue that the idea of a universal environmental imperative is undermined, both in principle and in practice, by this plurality of values. It is undermined in principle by the argument for the incommensurability of values coupled with the argument that the environmental imperative itself represents a value position. The idea of a universal environmental imperative is undermined in practice by the very existence of divergent values and priorities, because whereas the environmental imperative suggests there should be growing convergence at least on the presence of a threat that requires our immediate and full attention, if not on the means by which to deal with it, there is evidence to suggest that such convergence is not forthcoming. 34

Alfred Moore 35

Ecological thinkers have often claimed implicitly that ecologism is necessarily a democratic ideology (Dobson, 1996b, p. 132). However, the tension between democratic procedures and ecological outcomes is well recognized, and much effort over the last decade has gone into attempts to analyse and resolve it (Doherty and de Geus, 1996; Dobson and Lucardie, 1993; Barry and Wissenburg, 2001; Meadowcroft and Lafferty, 1996). Starting not from an ecological viewpoint, but rather from an analysis of concepts of risk in modern society, I hope to make some contribution to these debates. My approach in this essay will be interdisciplinary, bringing the political philosophy of value pluralism and sociological models of risk to bear on a key problem in ecological thought: that of the relation of democracy to ecology. I will begin with a brief look at some evidence for the claim that environmental imperatives are losing their purchase. After that I shall explain what I mean by risk, what I mean by radical uncertainty, and why risk issues are inherently value-laden. This idea will be clarified with the help of a couple of examples, one of a classic environmental risk, global warming, and another of a controversial health risk, the case of the MMR vaccine, both of which fall squarely into the category of ‘new risks’ of the risk society, as defined by Ulrich Beck some years ago. Finally, I will consider the consequences of this analysis for some common responses in social and political theory to the problem of risk, and this will entail an examination of what value pluralism in the politics of risk means for the idea of introducing democracy and openness into risk definitions, and also for the idea of promoting institutional reflexivity and learning.

What environmental crisis? Environmental imperatives seem to be losing their purchase. Ulrich Beck recently wrote that ‘the environmental crisis is itself in crisis’ (Beck, 1998, p. 154). Indeed, Detlef Jahn has gone so far as to say that ‘the environment does not look like being a major issue again’ ( Jahn, 1997, p. 181). Environmental voting in Europe peaked in 1989, and it has been claimed that green consumerism and activism peaked in 1998 (Macnaghten and Urry, 1998, p. 77). More generally, the idea of impending catastrophe and ecological disaster seems to have been discredited. It must be said that there always was an ideological element to predictions of doom, intended to provoke action rather than sober reflection. However, claims that the environment is being degraded, that resources are finite, that there are limits to growth and that current economic

36 Talking Environmental Imperatives to Death

practices will lead to ecological collapse on a global scale have been common and made in earnest. Such claims have been seriously questioned, most recently by Bjorn Lomborg in his book The Skeptical Environmentalist (Lomborg, 2001). Where concrete predictions have been made, particularly on the limits to growth and finite resource claims, they have been disproved. There was the famous bet between Paul Ehrlich and Julian Simon in 1980 on the future price of five metals, chromium, copper, nickel, tin and tungsten, Ehrlich believing that prices would rise owing to resource scarcity. But in fact the prices fell, and in 1990 Ehrlich paid Simon $576.07 (Huber, 1999, p. 14). In short, ecological collapse threatening the conditions of human existence does not yet appear to have arrived. Have we solved the environmental problem, as it has been understood by environmentalists? On the one hand, the ozone layer seems to be an environmental success story. Also, what has been called the ecological modernization of European societies has had some positive environmental outcomes. On the other hand, one can always find ample evidence that deforestation, air and water pollution, greenhouse gases and so on. are still on the rise in most of the world. Also, when talking about the environmental crisis, we must remember that crisis, disaster and catastrophe are in their very nature short-term phenomena, and human phenomena (Blühdorn, 2000). The physical world doesn’t have crises – we do. Thus the diminishing influence of the idea of ecological crisis and catastrophe may be in some measure due to the idea of ‘crisis’ being inherently short-term.

Risk, uncertainty and conflicting values This article will propose another explanation for the decline in importance of environmental imperatives. I will suggest that, in respect of the ‘new’ health and environmental risks which have become so prominent in our societies, risk is being overtaken by radical uncertainty. This movement can help explain how environmental imperatives have been undermined and why the politics of risk is, and will likely remain, a source of deep disagreement and conflict. What do I mean by risk? How is it being overtaken? Ortwin Renn has given a general definition of risk as the possibility that an undesirable state of reality may come about as the result of natural events or human activities (Renn, 1992, p. 56). Risk is typically associated with harm, and risk reduction typically means reducing the probability of an incidence of harm. This idea of risk embodies the value of harm reduction. In

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addition to disagreements over the states of reality and the probabilities of occurrence of this or that phenomenon, there are also potential disagreements over what constitutes harm. It is generally accepted that the last thirty or forty years have seen an explosive growth in risks as defined above, as more scientific research has uncovered more potential harms connected to more aspects of our behaviour, which has brought more of our lives and our actions into the realm of decision. There has also been a growth in what Beck called the new risks of the ‘risk society’ (Beck, 1986). These are characterised by the weakness of causal chains, the diffuse nature of both the suspected causes and the suspected effects, and the stretching of the risks over time as well as space, as we become aware of the effects of developments that took place sometimes twenty or even fifty or more years ago. Many environmental risks fall into this category, as do a great many health risks. What do I mean by radical uncertainty? How is it overtaking risk? The term radical uncertainty is used to distinguish it from scientific uncertainty or indeterminacy. Risk, in a formal sense, following Frank Knight (1921), is characterised by measurability and calculability. Even the ‘new risks’, inasmuch as they refer to the events in the physical world, could be argued to be at least potentially calculable, that is, we would expect growing knowledge of them even in the absence of anything like complete knowledge. Our knowledge of phenomena such as global warming improves with each new piece of research. Radical uncertainty, on the other hand, refers to human phenomena that are ultimately resistant to calculability and technical methods of risk reduction. This difference between risk and radical uncertainty is like the difference between the risk that champagne bottles may explode in storage, and the kind of uncertainty that surrounds the market value of champagne. This kind of idea suggests, for example, that in predicting future skin cancer rates, the scientific uncertainty surrounding the effects of changes in the ozone layer is of a different kind, and subordinate to, the radical uncertainty regarding the behaviour of people. One study in 1998 suggests that the dramatic rise in skin cancer rates in the latter half of the twentieth century is due not only to ozone depletion, believed to have become a factor in about 1980, but also to longer lifespans, better detection and, not least, the increasing popularity in the west of sunbathing (Kane, 1998). Indeed, one important function of statistical risk predictions is to change people’s behaviour: risk statements often take the form ‘This is what will happen, unless we . . . ’, and this goes some way to explaining why they are inescapably political.


Radical uncertainty, then, is the kind of uncertainty that surrounds human behaviour, definitions and perceptions of things such as harm, needs, wants, decisions as to what is tolerable or desirable, priorities and judgements about how individuals want to live and how they want society to be. It is my contention that phenomena rooted in radical uncertainty are becoming increasingly prominent in the definition of and responses to the ‘new risks’ of the risk society, especially environmental risks. So how exactly are radical uncertainty and value pluralism expressed in environmental risks? We have already seen that these ‘new risks’ are often characterised by problematic causal chains, diffuse causes and effects over time and space, and the undermining of the ordinary concept of decision. But when the notion of risk is stretched in this way, what happens to the idea of harm? Sustainability provides a good example of a concept which presumes a shared value of harm avoidance, and the problems, ambiguities and conflicts arising in the sustainability debate are indicative of the fundamental problem of defining environmental damage in terms of human harm. Andrew Dobson gives an excellent typology of ideas of sustainability (Dobson, 1996a). He argues convincingly that the arguments over what to sustain typically revolve around definitions of capital. Arguments over who to sustain for are often conducted in terms of human (and also sometimes non-human) welfare, and the debate then revolves around whether we ought to consider human needs or human wants, present or future and so on. Yet there is a persistent difficulty in distinguishing human wants from human needs. Even if we agree that all people should have adequate food, water, shelter and healthcare, one has to ask: How much is enough? Most ‘basic needs’ are insatiable, and conflicts over their relative priority are endemic. And furthermore, such basic needs can be incommensurable: for instance, how can we rationally weigh, say, pain relief against preservation of life? Judgements about ‘basic needs’ are judgements of the quality of life, which carries an altogether different moral imperative from that of avoiding clear, certain and deadly harm. In short, the sustainability debate presupposes that we have certain needs from the environment, that we can distinguish these needs from wants, and that we can clearly define a set of things in the world as ‘natural capital’, ‘critical natural capital’ or ‘irreversible natural capital’ (Dobson, 1996a, p. 407) and then seek to sustain them. All of these assumptions can reasonably be questioned. Indeed, within the sustainability debate itself there are sharp differences in the judgement of these matters. However, if we accept that there are divergent judgements of

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harm, needs, wants, quality of life and so on, and that these judgements can be irreconcilable and sometimes even incommensurable, then in what sense can we even talk of an objective environmental threat? Another other sense in which environmental risks are value-laden is in the suggestion that harm avoidance is itself a value, which can come into conflict with values such as freedom, equality, justice and peace. The key idea is that of the potential in some circumstances for an incommensurability of values: the idea that it may be impossible to compare values according to a scheme that encompasses all of those values. Comparing, say, peace and justice, is like comparing a height with a weight. There is no universal measure by which such values could be hierarchically ordered in each particular case. But if there is no rational scheme by which to force agreement on these values and priorities, then how are we to decide, say, between freedom and harm avoidance in the case of MMR, or harm avoidance and equality and fairness in development, in the case of global warming? One obvious answer would seem to be some form of democracy. Ideas of reflexivity, institutional learning, democracy and openness in risk definitions are currently predominant in academic discussions of risk and the environment. However, as we shall see later, radical uncertainty and value pluralism also undermine these solutions to the problem of environmental and health risks. Because this argument rests heavily on the assertion that divergent values are at the root of many of the conflicts over environmental and health risks, the idea of value conflict in environmental and health risks will be illustrated by two examples, MMR and global warming. These are not intended to be exhaustive case-studies; however what makes them relevant to the purposes of this article is that both are issues in which the science, though controversial, could be said to be converging, while the politics of the issues has shown no tendency to convergence – in fact, quite the opposite. This suggests that it may not be scientific uncertainty that is at the root of the highly controversial politics of risk, but rather the uncertainty that surrounds human values, perceptions and priorities.

The issue of global warming The idea that increasing levels of carbon dioxide and some other gases in the atmosphere could lead to a global temperature increase was first suggested more than thirty years ago. It is now a well-established and researched phenomenon. These gases reflect heat, and the idea is that


as their concentration in the atmosphere goes up, so will global temperatures. There is widespread agreement that the concentration of carbon dioxide in the atmosphere has risen by about one-third since 1850. This rise is attributed to human development. According to the 2001 report of the IPCC, the temperature of the earth has risen by between 0.4 and 0.8 °C in the last fifty years (IPCC, 2001, s. 2.2.2.1). Although there is still much disagreement among various climate models, almost all of them show temperatures rising. With better and more intensive research we can only expect our knowledge of this and related phenomena to become clearer (though probably never conclusive). There is still much disagreement on the precise causes and consequences of the greenhouse effect, but the argument of this paper is that the most fundamental disagreement regards the value we give global warming as a problem. That is, the least reconcilable divergence is on the extent to which global warming is considered a problem, that is whether it is viewed as catastrophe or as change. Environmentalists have for a long time taken it as read that global warming will have catastrophic consequences, but this view has been challenged, most recently by Bjorn Lomborg, who argues that our money would be better spent tackling the more tangible problems of poverty, disease and lack of education in the Third World. Also, the way in which the issue has slipped down the agenda in the domestic politics of many Western countries could be taken to suggest that global warming is no longer considered to be quite the catastrophe we once feared. The imperative of harm avoidance has clear implications for development: global carbon dioxide emissions must be limited to prevent any possible avoidable consequences of global warming. But many developing countries regard it as unfair that they are being told to rein back their industrialization, and not to cut down their own forests as Western nations did many years ago. That is, the imperative of global harm avoidance conflicts with the idea of the freedom of a state to do as it wishes with its own resources, and it can conflict, as has been well documented, particularly with the idea of economic equality between the developed and the developing world. We can fruitfully interpret the politics of global warming as expressing conflicting values regarding social and economic development. Indeed, even the IPCC (ibid.) tells us that the issue is not just climate change per se, but also development, equity and sustainability. But the very existence of different values in such a case inevitably undermines the idea of an overarching environmental imperative, one which cuts across political and geographical boundaries. For the existence of divergent

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values in this case shows that there can indeed be great political and geographical boundaries in problem perception, values, priorities and development goals.

The MMR vaccine controversy MMR is a very different case, and one which is in some ways more clear-cut: the science of the issue currently gives overwhelming support to the arguments of the public health officials. An article on a group of 12 children with autism and bowel disorders, published in the Lancet in 1998, kicked off the controversy. However, the authors of the article said that their study ‘did not prove an association between MMR vaccine and the syndrome described’ (Financial Times, 6 February 2002). Although autism is nowadays more frequently diagnosed, no country has seen a rise in autism coincide with the introduction of the vaccine, which has now been in use for thirty years. The WHO says MMR has an outstanding safety record. No country that uses MMR also offers single vaccines (France does, but only where epidemics threaten children not yet old enough for MMR), for the single vaccine means six visits to the doctor instead of two, and evidence strongly suggests that fewer children would complete the course. However, again, the argument of this paper is that the imperative of harm avoidance, which governs the actions of public health officials and doctors to a greater degree than most, can, and in this case does, conflict with other values. ‘Freedom of choice’ is a phrase that has cropped up frequently in the MMR debate. Janet Daley said on BBC1 ‘Question Time’ that parents should judge the risks for themselves and be free to choose what they think is best for their children. Now, although that argument is in this case clouded by the question of public responsibility, freedom and harm avoidance are values that are in conflict in this issue. Dr David Salisbury, head of the immunization group in the Department of Health, said that ‘the health service has never given parents the choice to do harm before’ (The Independent, 11 February 2002), and he may have put his finger on the key issue. He refers to a clear conflict here between freedom and harm avoidance. And the point is this: there does not seem to be any argument in favour of harm avoidance that does not simply refer back to itself. The argument for harm reduction is that it reduces harm. Freedom of choice is thus criticized by public health experts for undermining the imperative of harm avoidance. But if you don’t think harm reduction is in this case as important as freedom of choice, then you will be unmoved by such


arguments. There is no transcendent argument, no argument that incorporates both values in the same terms and gives a rationally compelling argument as to why one should take priority in this particular case. Freedom in this case means freedom to do harm, and the argument for freedom is immune to arguments in terms of harm avoidance. This, too, has profound implications for the idea of democracy in the politics of risk.

Objective harm and the ideal of democratic convergence The call for more democracy and more openness in risk definitions is widespread in current social and political thinking on risk and the environment. Such tendencies can be found in the recent work of sociologists such as Anthony Giddens, Sanjay Reddy, Bryan Wynne and even Bruno Latour. Ecological theorists, too, have often implicitly claimed that ecologism is necessarily a democratic ideology (Dobson, 1996b, p. 132). Despite the highly refined nature of the debates about the compatibility of democracy and ecology over the last decade, there is still a widespread tendency to assume that there can be rational convergence on an ecologically sustainable society, and this tendency rests on the very assumptions challenged in the earlier parts of this paper. It can be found in the work on risk, ecology and democracy of such varied thinkers as Ulrich Beck, John Dryzek and Michael Saward for they all construct models that rest, in different ways, on a notion of objective environmental harm. In an attempt to construct a model of an environmental political economy, John Dryzek argues for a ‘reflexive and self-conscious process of institutional experimentation and learning’ (Dryzek, 1996, p. 35). But why does he think we need to learn anything in the first place? Because he believes that our current socio-economic order clearly exploits and depletes common resources and belongs to a society that is environmentally unsustainable. He regards institutional reflexivity and learning as a response to this common problem, and for him such processes can only lead to a better understanding of the environment, and therefore more concern for it. He claims that his idea of institutional learning does not reduce to environmental ethics, and it ‘does not reduce to environmental education, because it presumes no right answers about ethics, practices and institutions’ (ibid.: p. 38), but he also says that this institutional learning is intended to keep what he calls the ‘dire consequences’ of our current socio-economic arrangements ‘in check’ (ibid.: p. 38). However, the aim of keeping these dire consequences in

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check presumes very particular answers regarding the ethics of development, and particular moral positions regarding the environmental consequences of current patterns of development. He claims that one can both criticize current socio-economic arrangements on the grounds that they constitute an unattractive world and at the same time advocate an institutional reflexivity that presumes no right answers to the question of environmental ethics. I don’t think he can consistently do both, for the question of environmental ethics has already been conclusively answered in the judgement that our current social and economic order generates dire ecological consequences and constitutes an unattractive world. In a more direct discussion of democracy and ecology, Dryzek finds a way for substantive environmental goals to be conceived as a necessary product of discursive democracy through the idea of a ‘generalizable interest’: ‘In offering a candidate for generalizable status, an individual is in effect claiming that rational, uncoerced and knowledgeable individuals would subscribe to it in the situation in hand’ – this ideal of communicative consensus can be seen at work in the example of reflexivity and learning sketched above; and, he goes on, ‘The continuing integrity of the ecological systems on which human life depends could perhaps be a generalizable interest par excellence’ (Dryzek, 1990, p. 55). This notion of a generalizable interest in ecological integrity is similar to what I have called a universal environmental imperative. Dobson gives an excellent critical analysis of Dryzek’s thoughts on discursive democracy and ecology (Dobson, 1996b), but I will only make one point. Although Dryzek accepts that there may be strongly divergent interests and values that get in the way of communicative consensus, he persists in his claim that everyone must come to recognize a deeper generalizable interest in a functioning ecosystem. But what is a functioning ecosystem? The crucial weakness is that ecological problems rarely, if ever, present themselves as the kind of clear and indisputable threats of harm that are required for there to be a generalizable interest. To the contrary, they arise overwhelmingly in the form of risks. And these risks, as argued earlier in this paper, outstrip the commonsense notions of harm from which the environmental imperative draws its force and urgency. Dryzek’s ideas of institutional reflexivity and generalizable ecological interests rest ultimately on a technical, rather than political, conception of the environmental problem. Only an objective conception of the environmental problem can be behind the view that, irrespective of people’s interests and values, there is a common human interest in a functioning ecosystem. Implicit here is the suggestion that people who hold different attitudes to the notion of a ‘functioning ecosystem’


are either not rational, not knowledgeable or being coerced. Against this, the argument from value pluralism suggests that rational, knowledgeable and uncoerced actors can differ greatly in their judgements of environmental risks and harms. Dryzek assumes that there is an objective character to the environmental problem, which means that personal and institutional approaches to it can be changed in what he would call the ‘right’ direction by more openness and more learning. However, to the extent that the environmental problem really is a human value issue, this is surely a forlorn hope. Michael Saward is deeply sceptical of the claim that ecological goals will necessarily result from some model of democratic practice. In a recent book on democracy, he says that there is ‘no guarantee that democratic processes will produce outcomes that are compatible with the goal of ecological sustainability’ (Saward, 1998, p. 175), though he doubts that alternative approaches could do any better. ‘In short,’ he concludes, ‘there is no case for restricting any of the requirements of democracy in the name of ecological sustainability’ (ibid.: p. 175). However, he adds in the very last line of the book that ‘a much more powerful case can be built to the effect that only a deepening of democracy, in all of its key dimensions, can help us to move more rapidly and effectively towards ecological sustainability’ (ibid.: p. 175). Almost in the same breath, then, we hear Saward claim both that there is no necessary link between democratic procedures and ecological outcomes, and that only a deepening of democracy can hasten the arrival of ecological sustainability. He tries to reconcile this contradiction through the idea of environmental risks to health, but this attempt is undermined by the argument made earlier for value pluralism in definitions of risk and harm. Saward binds ecology and democracy loosely together at two points. Firstly, he posits ecological sustainability as an essential precondition for life on earth, and therefore also, by extension, for democracy, in much the same way as we saw with Dryzek. More interestingly, from the point of view of this article, Saward advocates, in a 1996 paper entitled ‘Must Democrats Be Environmentalists?’, a ‘green democratic right not to suffer risks’ (Saward, 1996, p. 87). He subscribes to a model of democracy in which there is a set of rights which, by virtue of democratic citizenship, all citizens must have. Among these rights are the civil and political rights to freedom of speech, assembly and information, the right to participation, and so on. He also includes ‘positive’ social provisions, notably a right to ‘adequate education and adequate healthcare’ (ibid.: p. 84). Such ‘positive’ rights provide the conditions for effective exercise of both civil and political rights, and as such Saward holds them to be

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extensions of ‘negative’ civil and political rights, rather than being fundamentally different in kind, though this claim could be disputed. The right to healthcare is the opening through which he tries to smuggle environmental claims into the constitutional basis of his model of democracy. Healthcare, in Saward’s view, is not exhausted by curative treatments, but also includes prevention. ‘Preventive care concerns a range of risks which, if realized in practice, stand a high probability of causing significant harm to a citizen or group of citizens’ (Saward, 1996, p. 85). By ‘risk’ he means a situation in which there is a ‘greater or lesser probability that some specifiable harm may come to a person or people as a direct consequence of a definite, identifiable process or event’ (ibid.: p. 84). Saward gives three conditions that must be fulfilled before any notional right to freedom from risk can be assumed. Firstly, the risk must be man-made, which he also takes to signify that it was voluntarily assumed – he says leukaemia caused by proximity to nuclear facilities would be one such risk. Secondly, the risk must be ‘reasonably preventable’ (ibid.: p. 85) – like asthma caused by road traffic, he suggests. Finally, ‘if actualised, would the risk significantly diminish the citizen’s physical mobility and/or become a factor of life-consuming concern?’ (ibid.: p. 85); this is his explicit attempt to give an objective definition of the kind of harm that must be suffered in order to trigger a right to freedom from risk. It is noteworthy that Saward implies that most environmental issues are important principally in virtue of their being risks to human health; even global warming is given as an example of an environmental health risk (ibid.: p. 87). There are a great many problems with his argument, most of which he acknowledges, later concluding that the strength of the case for a right to freedom from risk is ‘at best ambiguous’ (Saward, 1998, p. 173). However, the weak point most relevant to the argument put forward in this paper is his use of a notion of objective harm. He talks of the problems of ‘calculating acceptable or tolerable risk’ (Saward, 1996, p. 90), and here he betrays the objective character of his ‘risks’; they are difficult to calculate, he asserts, but the harms are objective and severe. Quite to the contrary, I have argued that calculability is a technical problem, difficult but ever improving, whereas the notion of harm itself is the most irreducibly political category. Saward suggests that the risks are objective and the benefits are ‘a matter for political assessment’ (ibid.: p. 90), whereas I have argued that the risks themselves are a matter for political assessment. He regards global warming as one of the environmental risks to which we have a notional right not to be


exposed, but this right depends on a concept of objective harm that is not tenable. To date there has been no evidence of harm, in the form of an impairment of physical mobility or a ‘factor of life-consuming concern’, from global warming. Even the IPCC tells us that climate change is an issue of equity, sustainability and development rather than actual bodily harm in the here and now (IPCC, 2001, s. 2.2.2.1). The key point is this: even were there to be agreement on the science, on the relation of these actions to those effects on humans, and on the probabilities of various outcomes, there is ultimately no reason to suppose, as Saward implicitly does, that agreement can be reached on how we ought to value these outcomes. Inasmuch as the new risks are increasingly issues of how we want to live, convergence on definitions of harm will be ever harder to attain. Ulrich Beck, to a greater extent than Dryzek, conceives the environmental problem as a problem of risk, and his understanding of risk is more subtle than that of Saward. He is well aware that risks and their accompanying notions of harm and hazard are open to varying social definitions. However, he also holds the view that there are harms and hazards facing society in the form of ecological catastrophe that we must act globally, and act now, to mitigate. But in the absence of a fixed and universal definition of harm, catastrophe becomes change and the urgency of the environmental imperative disappears. The issue collapses into management of clear, agreed threats, and, at a more abstract level, into conflicts about the general direction of social and economic development. Beck himself tells us that the issues of the ‘new risks’, the health and environmental risks of late modern society, are issues of how we want to live. But does he really mean it? Will he accept that people may not want to live in the manner required by his ‘responsible modernity’? Risk society, for Beck, brings a particular set of questions to the forefront of social and political conflicts: Who is to determine the harmfulness of products and new technologies? Where knowledge about environmental risks is necessarily contested and probabilistic, what is to count as sufficient proof, and to whom should such evidence as there is be submitted? Who is to decide on compensation for the victims and on what kind of future damage-limitation, control and regulation should be introduced? These questions concern what Beck calls the relations of definition: ‘the specific rules, institutions and capacities that structure the identification and assessment of risk in a specific cultural context’ (Beck, 2000, p. 224). Beck’s central point is that the prevailing relations of definition systematically fail to take the ‘new risks’ seriously enough.

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They are recognized – otherwise even Beck himself would be unaware of them – but it is in their definition as harmful products and technologies that Beck argues for more openness. ‘Organized irresponsibility’ is how he describes the situation in which ‘new risks’ and hazards are detected and recognized, but the dominant relations of definition conspire against an appropriate response. This explains how and why ‘the institutions of modern society must unavoidably acknowledge the reality of catastrophe while simultaneously denying its existence, hiding its origins and precluding compensation or control’ (ibid.: p. 224). Yet how are we to decide what is harmful and what is not, where the fact is that people disagree? How are we to prioritize our various perceptions of harm? How are we to handle a plurality of views on what constitutes a good quality of life, or the right direction of future social, economic, scientific and political development? Beck is aware of these difficulties: Risk statements are neither purely factual claims nor exclusively value claims . . . As mathematical calculations (probability computations or accident scenarios) risks are related directly and indirectly to cultural definitions and standards of a tolerable or intolerable life. So in a risk society the question we must ask ourselves is: How do we want to live? (ibid.: p. 215) However, Beck asks how we want to live not in a truly open sense, but in the context of the picture he paints of looming ecological disaster. He asks: ‘What is still tolerable and what no longer?’ (ibid.: p. 218). He asks: Do we want it to be like this? Here it becomes apparent that Beck expects to receive an ecologically ‘responsible’ answer. The idea that the relations of definition provide the organization for the irresponsibility of development explains why Beck’s prescriptions for the risk society often focus on updating and democratizing the relations of definition. But is there any support for the suggestion that more democracy and openness in the ‘relations of definition’ will lead to a ‘more responsible modernity’? There is a tension between the view that society faces ‘objective’ threats, as Beck claims, and the view that definitions of risk and harm are socially ‘open’, which Beck also claims. If Beck holds that environmental risks constitute an objective, external threat to our existence, then these risks cannot very well be issues of how we want to live. If, on the other hand, Beck holds that harm, and thus environmental risks themselves, cannot be objective, then democratizing definitions of harm cannot guarantee that the new modernity will be


any more ‘responsible’. He can’t have it both ways. The argument advanced in this paper favours the latter position. For not only does it seem that agreement is unlikely on judgements of wants, needs, harm and quality of life, but the very value of harm avoidance can find itself in conflict with other values, and it is this more than anything that undermines the idea of a universal environmental imperative.

Conclusions The radical uncertainty surrounding human needs, desires, priorities and perspectives becomes more and more prominent in the politics of the ‘new risks’ of the risk society. These ‘new risks’, the unintended side-effects of technological development, the dangers of uncertain origin, diffuse effects over space and time, carry the commonsense notion of harm far beyond its breaking point. Many authors on environmental risk issues emphasize that they are really development issues, and I agree with them. The problem is that once we focus on the diffuse potential harms associated with general patterns of development, we lose the clear and present danger that justifies urgent action, and the environmental imperative becomes just one value among many, competing to shape debates on future social, economic and political development. This movement, in which risks are stretched and values and priorities become more prominent, undermines not only the idea of a universal environmental imperative but also the idea of convergence on responses to risk issues. Although specific aspects of the work of Dryzek, Saward and Beck have been criticized in isolation from the wider context of their thought, there are strong indications that they share an underlying notion of objective environmental harm, and a belief in a universal environmental imperative. This leads to their tacit assumption of the possibility of rational convergence on ecologically responsible ways of life. Dryzek asserts that rational, uncoerced and knowledgeable individuals will recognize a ‘generalizable interest’ in ecological sustainability, and that institutional learning will thus lead to an improved environmental consciousness. Saward acknowledges that democratic processes do not necessarily support ecological outcomes, but nonetheless advocates a deepening of democracy in the form of a universal right to health, and, by extension, a right to freedom from environmental and health risks. Beck says that environmental risk issues are characterised by the question ‘How do we want to live?’, yet he also argues that democratization of the ‘relations of definition’ of risks will lead to a more responsible modernity, thus presupposing that we will both recognize a common

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threat and come up with a common, and ecologically responsible, answer to his question. If my argument is correct, and issues of environmental risk are inescapably value-laden, then there can be no necessary connection between democracy and environmental responsibility, for risk avoidance, harm reduction and so on are all values that are not necessarily shared or given the same priority by all people in all places at all times. Furthermore, it may not be possible to force agreement by referring to a scheme or rationality that encompasses all of those values and places them in a hierarchy in neutral terms. So when we see these inevitable value conflicts emerging in our current politics of risk, through such varied issues as global warming, the MMR vaccine and so on, we must recognize that, although science will improve our knowledge of the probabilities of occurrence of certain phenomena, it is likely that these issues are in their nature conflictual. We must recognize that harm avoidance is itself a value and that imposing that value over all other values cannot be justified except in terms of that value itself. The question of how we actually balance the conflicting demands of harm minimization, freedom, equality and so on cannot therefore be answered in terms of those values themselves, and if we invoke democratic principles to resolve such conflicts then we must give up the idea that its outcomes will necessarily conform to particular ideas of what is good for society. The programme of ‘reducing’, ‘tackling’ or ‘mitigating’ environmental and health risks is a kind of technology, for the ends, the goals, are already given. Radical uncertainty is what characterises the relations between these ends, and other different, competing, sometimes mutually exclusive and even incommensurable ends. And the well-documented ‘new risks’ of the risk society, in stretching the notion of harm, and fusing harm reduction with broad development aims, are increasingly subject to radical uncertainty. This is why, according to my argument, more science and more democracy cannot solve the ‘problem’ of risk in late modern societies, because the very idea of a solution is undermined by the simple presence of deeply conflicting values regarding the problem.

References Barry, J. and Wissenburg, M. (eds) (2001) Sustaining Liberal Democracy. Ecological Challenges and Opportunities. Basingstoke: Palgrave. Beck, U. (1986) Risikogesellschaft: Auf Dem Weg in Eine Andere Moderne. Frankfurt am Main: Suhrkamp. Beck, U. (1998) ‘Brief introduction to environmental Machiavellianism: green democracy from below’, in U. Beck (ed.), Democracy without Enemies, pp. 154–61. Cambridge: Polity Press.

50 Talking Environmental Imperatives to Death Beck, U. (2000) ‘Risk Society Revisited: Theory, Politics and Research Programmes’, In B. Adam, U. Beck and J. van Loon (eds), The Risk Society and Beyond, pp. 211–29. London, Thousand Oaks, New Delhi: SAGE Publications. Blühdorn, I. (2000) Post-Ecologist Politics: Social Theory and the Abdication of the Ecologist Paradigm. London: Routledge. Dobson, A. and Lucardie, P. (eds) (1993) The Politics of Nature. Explorations in Green Political Theory. London: Routledge. Dobson, A. (1996a) ‘Environmental sustainabilities: an analysis and a typology’, Environmental Politics, 5(3), 401–28. Dobson, A. (1996b) ‘Democratizing Green Theory: Preconditions and Principles’, In B. Doherty and M. De Geus (eds), Democracy and Green Political Thought. Sustainability, Rights and Citizenship, pp. 132–48. London: Routledge. Doherty, B. and De Geus, M. (eds) (1996) Democracy and Green Political Thought. Sustainability, Rights and Citizenship. London: Routledge. Dryzek, J.S. (1990) Discursive Democracy: Politics, Policy and Political Science. Cambridge University Press. Dryzek, J.S. (1996) ‘Foundations for environmental political economy: the search for Homo Ecologicus?’, New Political Economy, 1(1), 27–40. Huber, P. (1999) Hard Green: Saving the Environment from the Environmentalists: A Conservative Manifesto. New York: Basic Books. IPCC. (2001) Climate Change 2001: The Scientific Basis. Cambridge University Press. Jahn, D. (1997) ‘Green Politics and Parties in Germany’, in M. Jacobs (ed.), Greening the Millenium?, 174–82. Oxford: Blackwell. Kane, R.P. (1998) ‘Ozone depletion, related UVB changes and increased skin cancer incidence’, International Journal of Climatology, 18(4), 157–72. Knight, F.H. (1921) Risk, Uncertainty and Profit. Boston: Houghton Mifflin. Lomborg, B. (2001) The Skeptical Environmentalist. Cambridge University Press. Macnaghten, P. and Urry, J. (1998) Contested Natures. London: Thousand Oaks. Meadowcroft, J. and Lafferty, W.M. (eds) (1996) Democracy and the Environment. Problems and Prospects. Cheltenham: Elgar. Renn, O. (1992) ‘Concepts of Risk: A Classification’, in S. Krimsky and D. Golding, (eds), Social Theories of Risk, pp. 53–79. Westport, CT: Praeger. Saward, M. (1996) ‘Must democrats be environmentalists?’, in B. Doherty and M. De Geus (eds), Democracy and Green Political Thought. Sustainability, Rights and Citizenship, pp. 79–97. London: Routledge. Saward, M. (1998) The Terms of Democracy. Cambridge: Polity.

3 Environmental Preferences and Piaget’s Theory of Knowledge: Searching for Necessity in Environmental Preference in Northern Thailand Kevin Marsh

Summary Acknowledging that so many debates within the social sciences have so long been simultaneously characterised by the nature–culture dichotomy in the explanation of behaviour, and the general acceptance that some middle ground represents the way forward in understanding behaviour, this paper asks whether the social sciences have what it takes to take the step into the no man’s land of the middle ground between nature and nurture and explain environmental preferences. A summary of the ‘in nature’ and ‘socially constructed’ sides of the environmental preference debate are reviewed and a possible interactionist model developed based upon the genetic epistemology of Jean Piaget. In doing so the theoretical and methodological issues facing the social sciences in explaining environmental preferences are highlighted in the hope of furthering the research agenda into environmental preferences.

Introduction As with many debates within the social and behavioural sciences, attempts to explain the nature and source of environmental preferences 51

52 Environmental Preference in Northern Thailand

within environmental psychology are characterised by the nature– culture dichotomy. On one side of the debate sit those who propose an innate, biological explanation for human preferences. On the other are those who favour an explanation based on local, cultural circumstances. However, while this dichotomy still tends to define approaches to the subject of human behaviour, it has long been recognized as an obstacle to furthering understanding of human behaviour. It was this same nature– culture dichotomy that formed the subject-matter of C.P. Snow’s The Two Cultures and the Scientific Revolution (1959), and evoked his comment: ‘This polarization is sheer loss to us all’ (quoted in Wilson, 1998:138). Steven Pinker, often associated with the ‘nature’ side of the dichotomy, argues that the ‘dichotomy between “in nature” and “socially constructed” shows a poverty of imagination, because it omits a third alternative: that some categories are products of a complex mind designed to mesh with what is in nature’ (1997, p. 457). The call for an interactionist approach to the understanding of behaviour, one that finds some middle ground between ‘nature’ and ‘culture’, can be heard in a number of behavioural-based disciplines. Brown (1991, p. 88) concludes a comprehensive review of the classic anthropological texts: A great many universals do require explanation, at least in part, in biological terms. Many seem to require explanation in ‘interactionist’ frameworks – that is in terms of combinations of biological and cultural factors. If we want to understand universals in the context of particular societies, the necessity of the interactionist framework is all the greater. Similar sentiments are heard from those familiar with debates concerning the form of environmental preferences. The organization of this debate according to the culture–nature dichotomy has been criticized as too simplistic. Commenting on this dichotomy, Bourassa (1990, p. 788) states that: Among those who have investigated the matter, there is a clear consensus that theory has been neglected in landscape or environmental aesthetics . . . There have been vast amounts of research in the field, but that research has not been unified or informed by any comprehensive theory of landscape aesthetics. Instead, the various research efforts either are atheoretical or reflect fragmented and apparently

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incompatible theoretical foundations. The work that has been done on theory tends to focus exclusively on either biological or cultural bases for aesthetic behaviour, without any attempt to reconcile those apparently incompatible sets of explanations. Stephen J. Gould (1991) reminds us that Goethe realised that some dichotomies must interpenetrate, and do not struggle to death on one side, because each of their opposite poles captures an essential property of any intelligible world. Following the spirit of Goethe’s insight, this paper attempts to step into the middle ground between ‘in nature’ and ‘socially constructed’. It suggests that working towards a fuller understanding of human interaction with the environment in this way is vital if policy recommendations emerging from the social sciences are to enable progress to be made in conserving the natural environment. The author is not arrogant enough to suppose that the investigation presented within this paper can hope to achieve the reconciliation between nature and nurture that has so long eluded many more able thinkers. Instead it is the intention of this paper to contribute to research within this area by asking the question: Given that so many debates within the social sciences have so long been simultaneously characterised by the nature–culture dichotomy in the explanation of behaviour and the general acceptance that some middle ground represents the way forward in understanding behaviour, do the social sciences have what it takes to take the step into the no man’s land of the middle ground? The issues and obstacles facing the social sciences in this task will be illustrated through an attempt to present and test an interactionist model of environmental preferences. Having briefly outlined the nature and culture poles of the environmental preferences debate in the next section, the section after that attempts to address the theoretical issues in constructing an interactionist model by proposing Piaget’s genetic epistemology as one such possible model. Some of the methodological issues in analysing environmental preferences are addressed in two further sections, where a survey to test the hypothesis that Piaget’s genetic epistemology provides such an interactionist model is designed and tested. The final section identifies the main challenge to the reconciliation of ‘in nature’ and ‘socially constructed’ as the fundamental objection to the proposition that the local and universal elements of environmental preferences can be distinguished in order that any interactionist model could be tested.


The nature and source of environmental preferences Biophilia: innate environmental preferences There are a number of debates within the social and behavioural science literature as it relates to people’s conceptions of and preferences for the environment that correspond to the nature–culture dichotomy identified above. Within the anthropology literature, for instance, Atran (1990, 1995), Berlin (1972, 1978) and Sperber (1994) identify cross-cultural commonalities in the classification of biological kinds in spite of local variations in the plants and animals that any local population encounters. They go on to interpret their observations as reflecting innate perceptual modalities that underlie and make possible explicit biological theory. Others, however, find the evidence for innate biological classification insufficient, and suggest that conceptions of the environment are learned through more general learning procedures (Keil, 1994). In support of this position, alternative explanations of commonalities in biological classification are presented, including the idea that such commonalities result from consistencies in the external natural world as experienced by local populations (Hirschfeld and Gelman, 1994; Carey, 1995). For the present purposes, however, attention will be focused on a specific manifestation of the nature–culture dichotomy found within the environmental psychology literature as it is concerned with the source and nature of environmental preference. On one side of the debate reside those who support the notion that environmental preferences are influenced by evolved tendencies to prefer certain landscape forms – a phenomenon E.O. Wilson (1984) has dubbed ‘biophilia’. What Wilson presents as intuitive with the support of circumstantial evidence in his Biophilia (1984) has also been the subject of more rigorous scientific investigation of environmental aesthetics as affective, evolved, functionally based ways of responding to the informational patterns of our environment. Research on the biological mode of biophilia could be considered to have begun with Appleton’s (1975) The Experience of Landscape. Appleton’s basic thesis is that a landscape that appears to facilitate survival is one that will also provide aesthetic satisfaction. The basic proposition here is that certain rewards or advantages associated with natural settings during evolution were so critical for survival as to favour the selection of individuals with a disposition to acquire and then retain various adaptive positive responses to unthreatening natural configurations and elements.

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Support for explaining landscape preferences as a function of evolved values suggests that biology may play a role in at least three positive or ‘biophilic’ responses to unthreatening natural landscapes: ‘liking/approach’ responses, restoration or stress recovery responses, and enhanced highorder cognitive functioning when a person is engaged in a non-urgent task (Ulrich, 1993). Over the last twenty years, a considerable research literature relating to the first type of positive responsiveness, ‘liking/ approach’, has been amassed, and it is this response that will form the basis for the following discussion of universal factors in environmental preference determination. While a number of survival problems have been considered in the application of evolutionary principles to the determination of ‘liking/ approach’ responses, including way-finding and habitat selection (Kaplan, 1992; Orians and Heerwagen, 1992), each approach focuses on the information-processing abilities of the human mind in surviving in an environment. The rationale behind the application of evolutionary principles to explaining environmental preferences is that humans, as informationseeking animals, were much more likely to survive in an environment which provided the necessary resources and accessible, comprehensible information (Kaplan, 1992; Orians and Heerwagen, 1992). Natural selection would then tend to favour individuals who preferred landscapes that provided the information necessary to survival. The characteristics that receive most consistent support in the evolution of landscape preference are the complexity 1, coherence,2 legibility3 and mystery 4 of the landscape, and the existence of water within the landscape. Although the proposed combination and relative importance of these factors in the determination of preference varies with author and between studies, 5 their presence remains consistently significant. Before continuing any further, it is important to make clear that, while the notion of biophilia is concerned with the explanation of environmental preferences, it attempts to do so only at the cognitive/information processing level. That is, it ignores any affective aspects of environmental preference thought to result from the development of, for example, a sense of place. Thus, it is cognitive rather than affective reactions to the environment that will be the exclusive concern of the remainder of our discussion.

Local influences on landscape preferences Consistent with the nature–culture dichotomy elsewhere in the behavioural sciences, a number of academics have expressed their


dissatisfaction with the biophilia hypothesis and have proposed an alternative explanation of preference formation based on local, cultural circumstances. It is suggested that the application of the results presented in support of the biophilia hypothesis is limited to the population from which participants were selected and the specific landscapes presented, and that variations in culture, environment, sex, personality, age, occupation and race produce local variations in landscape aesthetics. Lyons (1983, p. 505) documents significant variations in the results of environmental preference studies that ‘suggest that the development of landscape preference is a cumulative process that reflects the action, through the life-cycle, of socially differentiating attributes such as age, gender, place of residence, and environmental experience’. Moreover, ‘each of these works marshals evidence that social and demographic factors act differentially on populations to produce a range of environmental tendencies’ (Lyons, 1983, p. 489). Studies support a range of contextual elements that influence landscape preferences:

• Duncan (1973) found patterns of landscape taste that correlated with social class.

• Zube et al. (1974) found that the factors that most consistently explained • • • • • • • •

variation in preference were landscape exposure as a child, occupation and place of residence. Hecht (1975) found patterns of landscape taste that correlated with social class. Daniel and Boster (1976) found evidence for preferences based on the subject’s place of residence. Macia (1979) found significant preference differences between male and female university students. Miller and Rutz (1980) suggest that different adult preferences are due to increased content discrimination as a result of learned cultural values. Balling and Falk (1982) demonstrated different preference patterns for adults with varying occupations, as well as that preferences change with age. Zube et al. (1984) report significant variations in environmental preference as a function of age. Greenbie (1992) documented how lifestyle and life experience influence landscape values and choices. Zuckerman et al. (1993) report variations in preference with ethnicity and the sensation seeking personality trait.

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An observation that supports the hypothesis that local factors explain landscape preferences is that studies suggesting apparently universal aspects of human environmental preferences have tended to concentrate their research effort within Western countries, particularly North America and Europe (Lyons, 1983; Ulrich, 1993).

An interactionist explanation of environmental preferences: Piaget’s genetic epistemology The criteria for an interactionist model In order to begin to locate some middle ground between the ‘nature’ and ‘culture’ camps, it is necessary to turn briefly to some of the more theoretical insights that underlie the two positions, and to understand what it is that they find unacceptable about their rival’s arguments. Through this approach we can identify the issues that need addressing and the criteria that require satisfying when we come to construct possible interactionist models. Perhaps the best-known manifestation of the notion that there exist innate cognitive functions currently available within cognitive science is the modularity or domain-specificity thesis. Derived from the argument advanced by Fodor’s The Modularity of Mind (1983), and reflected in Noam Chomsky’s (1988) influential theory of language, the domainspecificity thesis proposes that certain cognitive functions are performed by modules, autonomous components of the mind that, while interacting with, receiving input from, and sending output to other cognitive processes or structures, perform their own internal information processing unperturbed by external systems. The modular approach can be seen as motivated as a response to the problem of attending to ‘inputs’ in a way that that supports the development of concepts shared among people. It is argued that experience alone is inadequate to produce such shared concepts, as many of the critical concepts children need to learn never appear consistently in experience, which is open to many alternative construals. Keil (1995; p. 241) tells us that ‘there must . . . be belief-like structures that narrow down an indefinitely large number of features and feature relations to a manageable number’. These represent restrictions on the kinds of knowledge structures that the learner typically uses. The ‘nature’ argument that there exist innate concepts is thus used to narrow the possible readings of inputs and simplify learning. That is, learning by its nature presupposes the application of some concepts.


Critics of modularity argue that the processes to which modularists advert in support of their thesis are in fact instances of more general cognitive processes. Their rejection of the modular thesis and the corresponding ‘nature’ account of conceptual development is based partly upon a dilemma that it poses: for instance, knowing innately that there are, say, nouns still leaves the learner with the problem of determining what words are nouns. A ‘bootstrap’ is needed from innate formal knowledge to particular knowledge: without first-hand experience of an object, how could one recruit an innate representation of the object? Any interactionist model is faced with the challenge of reconciling these two problems and understanding how the ‘learning’ of concepts is consistent with the prerequisite existence of concepts.

‘Bootstrapping’ innate knowledge: Piaget’s genetic epistemology The hypothesis presented for testing in the remainder of this paper is that a possible interactionist model is provided by the epistemological lessons that can be derived from Jean Piaget’s stage theory. Although Piaget’s work is not without its critics, Piaget himself is extremely important in the history of thought in psychology and this work still holds some important epistemological lessons. While it is his theory of cognitive development in the context of child psychology for which Piaget is known best, he himself claims to be addressing epistemological issues, in particular genetic epistemology: ‘the study of the development processes that underlie the mental functions studied in general psychology’ (Piaget and Inhelder, 1966, p. viii). Piaget’s answer to the interactionist question of how the learning of concepts is consistent with the prerequisite existence of concepts was to suggest that nature gives rise to instinctive behaviours (primitive schemas) that ensure our environment will be experienced, a notion that formed part of his ‘stage theory’ of cognitive development. Piaget believed that knowledge requires a prior cognitive framework, and that one cannot know without prior categories of thought (Kitchener, 1986).

The stage theory of cognitive development Although there is some ambiguity as to what is actually meant by genetic epistemology and how it is to be distinguished from the related fields of evolutionary epistemology, developmental epistemology and historical epistemology, it can perhaps best be described as concerning the notion that changing epistemic states abide by certain rational

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constraints, limiting the logical form any epistemic trajectory can take (Kitchener, 2000). Piaget’s stage theory of cognitive development, as its name suggests, states that concepts develop in stages, each of which builds upon the previous one. In order to explain conceptual development, Piaget proposed a series of four stages, each with an underlying cognitivelogical structure, in which conceptual schema, such as space, time and object, develop from more primitive schema, such as sucking, grasping and seeing (Kitchener, 1986). Piaget describes the manner in which these structures develop between the stages using the notions of ‘assimilation’ and ‘accommodation’ (Kitchener, 1986):

• An object is assimilated into cognitive structures as the subject acts towards it in a certain way, just as the child who sucks its thumb assimilates it into a sucking schema. In acting towards an object, it is judged, interpreted or brought under a certain category. Hence, assimilation is equivalent to a judgement: to assimilate a thumb to a sucking schema is to judge a thumb as something to be sucked. • Accommodation is a process in which the epistemic subject and its structures are modified to match more closely the properties of the external object. Cognitive structures are brought into line with the external world. Assimilation and accommodation should not be conceived as two separate processes working one after the other; instead they function reciprocally and simultaneously. Accommodation is the process of adjusting structures to the object as assimilated, and assimilation is the incorporation of an object into accommodated structures (Kitchener, 1986). Had we pure assimilation with no accommodation, we would have the epistemological counterpart of naive idealism: pure assimilation would be pure fantasy, comprising only the creative role of the subject, and theories would be produced irrespective of facts. Conversely, had we pure accommodation without assimilation, we would have the epistemological counterpart of naive realism: the non-creative imitation of external objects or objective facts in which the subject would play no active role. Each of these extremes Piaget rejected.

Piaget’s theory of knowledge The processes of assimilation and accommodation represent an interactionist perspective to cognitive development. Piaget argued that


empiricism, or the ‘culture’ model, is wrong in its claim that the mind passively acquires knowledge. Instead cognitive development, mediated through assimilation and accommodation, results in knowledge that is at least in part due to the subject’s creative activity of constructing it. That is, observation is not free from conceptual elements, as empiricism would have us believe. Thus, in a certain sense Piaget is a rationalist, accepting the ‘nature’ model and the notion that, a priori, innate faculties provide the general axioms upon which knowledge of the external world must be written (Kitchener, 1986). However, Piaget neither entirely accepts the rationalist position, nor entirely rejects the empiricist position. He does not deny the empirical method, arguing instead that empiricism has interpreted empirical and experience in the wrong manner – knowledge as the passive ‘reading off’ of sense data, free from interpretation or judgement. Moreover, he accepts the inadequacies of rationalism – its transcendence of the limits of observation by theoretical reflection, and then claiming that such reflection carries with it knowledge of reality – and criticizes the use of innate concepts to explain how thoughts are able to correspond with reality, which he described as ‘structure without genesis’ (Kitchener, 1986). Piaget’s processes of assimilation and accommodation can be seen as accepting elements of both the empiricist and rationalist positions, of both the ‘nature’ and ‘culture’ explanations of cognitive development. Assimilation is equivalent to the rationalist’s judgement, so that the basic epistemological unit is a judgement involving rules, categories, schemas and principles. Thus, knowledge is organized and structured in a complex way, and the source of this organization lies in the epistemic subject. However, Piaget differs from the rationalist on the source of these judgements. Where the rationalist believes the structure of the mind to be fixed at birth, Piaget admits that the functioning of the mind is fixed at birth, but denies that its structure is (Kitchener, 1986). Thus, Piaget maintains not only that knowledge is constructed by the subject but also that the epistemic categories or judgements are themselves constructed. This is the role of accommodation, the empiricist’s acquisition of knowledge based on experience. Thus, Piaget provides a way to understand how the ‘learning’ of concepts a posteriori is consistent with the prerequisite existence of concepts a priori. What emerges from Piaget’s genetic epistemology is a reconciliation of the notion that concepts can be universal and necessary with the notion that such concepts are formed through experience of

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the external world. It is suggested that Piaget accepts a ‘looser version of transcendental knowledge’: the construction of categories follows a certain sequence of stages that necessarily lead to the construction of the cognitive structures characteristic of adults who experience the world in the same manner – for instance, mathematics and logic (Kitchener, 1986).

Piaget’s genetic epistemology and environmental preference Piaget’s suggestion that the functioning of the mind provides the basis for the learning of universal concepts allows both the universalities of the ‘nature’ approach and the learning aspects of the ‘culture’ approach to be incorporated into one framework. Specifically, the notion that there might exist some form of logical necessity in the way features of the local environment are assimilated and accommodated into environmental preferences might be expected to result in a preference structure whereby learned preferences reflect universal principles expressed within the local context. Thus, the following characteristics of environmental preference might be predicted: 1. There are underlying universalities in preference, owing to logical necessity in preference development. 2. Local factors contribute to preference determination, owing to the logical necessity in preference development being expressed in the local context. 3. Local factors are more important than universal factors in predicting preference, as learned preferences are the expression and elaboration of universal tendencies in the context of the specific local environment. 4. Local and universal factors in preference determination are related, as local factors encompass universal principles. Specifically, variation in universal principles can predict variation in local factors in preference determination to the extent to which the local factors encompass these principles. However variation in local factors can predict variation in universal factors entirely, as it is these universal principles that form the building blocks for locally determined landscape preferences. Testing whether these predictions are reflected within preferences and thus the possibility that Piaget’s genetic epistemology might provide a way to resolve the nature–culture dichotomy is the subject of the remainder of this paper.


Method Subjects One of the criticisms aimed at the ‘nature’ approach to explaining environmental preferences is that studies that suggest universal aspects of environmental preference tend to be concentrated in Western countries. In order to avoid running into this same criticism, the insights into the form of universal aspects of environmental preferences emerging from this literature were applied and tested among the residents of northern Thailand. A sample of 220 people were selected from a range of social and cultural contexts within the northern Thailand region. The sample was split evenly between Thais from Chiang Mai (the second largest city in Thailand), Chiang Dao (a small town about 75 km north of Chiang Mai) and Baan Tham (a village in the countryside outside Chiang Dao), and the Karen villagers of Mae Paa Sao and Yang Phu Dto living in the hills above Chiang Dao (see Maps Figures 3.1 and 3.2). Every subject was over 18 years of age and had been resident in the location for the whole of their life, thereby ensuring the influence of local environmental norms.

Burma

Laos

N

Chiang Rai

Wildlife sanctuary Mae Hong Son Chiang Dao Phayao

Chiang Mai 0

Figure 3.1

100 Km

Northern Thailand

Thailand

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Mae Paa Sao Baan Tham

Muang khong Yang Phu Dto

To Chiang Dao

Figure 3.2

Doi Chiang Dao wildlife sanctuary

Stimulus and response format As highlighted earlier, the investigation presented in this paper is concerned only with explaining preferences at a cognitive/information processing level. This approach was facilitated through the separation of the person and the landscape being evaluated through the use of photographs, as well as ensuring the landscape photographs used did not represent environments directly familiar to the participants. Because landscapes do not lend themselves to easy evaluation by a large number of people, this study, like many others, employed photographs of landscapes.6 Each participant was presented with 10 pairs of landscape photographs (appendix 2), composed from 11 different photographs (appendix 1), for a period of approximately 10 seconds, and asked to indicate, where possible, which one was preferred. In order to guard against the effects of familiarity/unfamiliarity, all the landscapes chosen reflected different local, northern Thai landscape forms, ensuring that all the participants were as equally familiar with landscape forms as possible. The photographs were all colour and the same size. They were chosen to reflect various of the landscapes available in the Northern Thai region, ranging from cultivated fields to plantations to natural forest. They were paired so as to ensure participants faced a choice between as many combinations of different landscape


forms as was possible from the photographs. No scenes were used that included people or roads, and the presence of animals, fences, and buildings was kept to a minimum. None of the pictures showed evidence of fire, predators or prey.

Defining predictor variables From the brief summary of the literature concerning the possible universal aspects of landscape preference given above, under ‘The nature and source of environmental preferences’, the complexity, coherence, legibility and mystery of the landscape, and the existence of water in it, were identified as contributing to preference. From a review of relevant social norms in the northern Thailand region, local aspects of landscape preference were approximated by ‘the extent of forestation’ and the ‘lushness of the vegetation’. 7 Individual pictures were ranked by an independent panel8 according to each of these characteristics on a scale of 0 (being weak in the particular characteristic) to 5 (being strong in the particular characteristic). For each pairing of pictures, the score for the second picture was subtracted from the score of the first for each of the characteristics. This provided an indicator of the difference between the picture combinations for each of the characteristics (a score ranging from −5 to 5) that was then compared with the number of participants choosing the first picture from each pairing as preferred in order to determine the contribution of the different landscape characteristics to people’s preference. 9

Analysis The four predictions for the form of landscape preferences made through the elaboration of Piaget’s genetic epistemology are tested through an analysis of the relationship between, first, landscape preferences and the landscape characteristics thought to influence preferences, and, second, the relationship between the different aspects of the landscape that contribute to preferences. It is predicted that there are both ‘universally’ and ‘locally’ derived aspects of landscape preferences. Thus, we would expect landscape preferences to be related to both the different local and universal elements of landscape preference described above. Moreover, as locally determined aspects of preferences are the manifestation of more general universal principles in the local context, it is predicted that local elements will show a stronger relationship with preferences than universal elements. As the dependent variable, respondents’ preferences, is a categorical binary variable (each respondent chooses picture one or picture two),

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the relationship between this and the ordinal (on a scale of −5 to 5) independent variables, local and universal determinants of preferences, is investigated using chi-squared and Cramer’s V-tests and a logistic regression model. The chi-squared test is used as a preliminary exploration of the data and to examine whether relationships exist between the dependent and independent variables. The logistic regression model, as it controls for the effects of the other independent variables and provides an indication of magnitude of the relationship between dependent and independent variables, is used to examine any relationships further. Whether or not local aspects of landscape preferences are the locally specific application of more general universal principles is tested through an examination of the relationship between the local and universal elements of preferences identified above. Specifically, it is asked, can universal principles predict local elements in preference determination, and vice versa? The non-parametric nature of the ordinal landscape characteristic data means that this is initiated with a Spearman’s correlation test. Following on from this, a regression analysis is performed to determine the ability of local and universal landscape elements in preferences determination to predict each other, and thus assess the hypothesis that local elements encompass and build upon those elements identified as universal. As the response variables have greater than two categories, this was performed through the use of a multinomial logistic model.

Results The relationship between landscape preferences and landscape characteristics The chi-squared test, the results of which are reported in Table 3.1, examines whether there is an association between respondents’ preferences and the characteristics of the landscape identified above. In each of the relationships examined, the chi-squared statistic is highly significant, indicating that the preferences and each of the universal and local elements of preference determination identified are likely to be related. The chi-squared statistics can be used to determine whether there is any association between two variables. However, it does not say anything about how strong this association might be. For this we must turn to the Cramer’s V-statistic which modifies the chi-squared statistic to take account of the sample size. The Cramer’s V (Table 3.1) suggests

66

Table 3.1

Chi-squared and Cramer’s V-analysis

Chi-square

Preference

Cramer’s V

Preference

Coherence

Complexity

Legibility

Mystery

Water

Lushness

Forest

631.6 p = 0.000 n = 2130 0.385 p = 0.000 n = 2130

289.3 p = 0.000 n = 2130 0.261 p = 0.000 n = 2130

617 p = 0.000 n = 2130 0.381 p = 0.000 n = 2130

595.9 p = 0.000 n = 2130 0.374 p = 0.000 n = 2130

389.8 p = 0.000 n = 2130 0.303 p = 0.000 n = 2130

391.8 p = 0.000 n = 2130 0.303 p = 0.000 n = 2130

843.2 p = 0.000 n = 2130 0.445 p = 0.000 n = 2130

Kevin Marsh 67 Table 3.2 Forward stepwise (likelihood ratio) logistic regression showing the effects on the odds of preferring a landscape (n = 2130) Independent variables

Odds of preferring a landscape

Standard error

Coherence Complexity Water Legibility Lushness Mystery Forest Constant

9.433* 2.906* 4.138* 1.234* 0.717* 0.170* 1.500* 0.129*

0.25 0.19 0.13 0.06 0.08 0.19 0.06 0.20

*p < 0.001. Chi-square = 691.47 for 7 df.

that, while none of the relationships between preferences and landscape characteristics is particularly strong, the landscape characteristic that demonstrates the strongest relationship with preference is the extent of forestation. The landscape characteristics measured are not mutually exclusive and may themselves be related, something that tends to complicate the results reported in Table 3.1, as none of the tests performed control for the effects of other independent variables. The controlling for the effects of other independent variables is one of the advantages of the logistic regression model. The logistic regression model reported in Table 3.2 tends to support the results of the chi-squared and Cramer’s V-tests, as all the independent variables show a statistically significant relation with landscape preferences. That is, all the independent variables make a significant contribution to improving the model’s ability to predict preferences. Perhaps the most important thing to take from this result is that the majority of the independent variables are positively related to preferences (odds of preferring a landscape >1). That is, the higher a landscape’s score based on these variables, the more likely it is to be preferred. This is not the case, however, for the mystery and lushness of the landscape. The goodness-of-fit statistics for the logistic regression model reported in Table 3.3 suggest that, while all independent variables make statistically significant contributions to the predictive power of the model and the extent of forestation contributes most of the independent variables to the prediction of preferences, there are still significant variations in preferences left unexplained by the model. The addition of

68 Environmental Preference in Northern Thailand Table 3.3

Goodness-of-fit statistics for logistic regression model

Additional variable

Constant Forest Water Mystery Coherence Legibility Complexity Lushness

Chi-squared

−2 log likelihood

425.2* 79.7* 69.3* 49.0* 34.6* 16.7* 16.9*

2495.8 2416.1 2346.7 2297.7 2263.1 2246.4 2229.6

% of observations predicted 56.1 72.1 72.1 72.1 72.1 77.2 77.4 77.4

* p < 0.001.

the variable ‘extent of forestation’ to the model improves the predictive power of the model from 56.1 per cent of observations to 72.1 per cent of observations. The inclusion of the remaining 6 independent variables only increases this predictive power to 77.4 per cent of observations. A similar story is told by the −2 log likelihood statistic, which shows the amount of variation as yet to explained by the model and which is still high after the application of the model.

The relationship between landscape characteristics While the investigation of the determinants of preferences uses participants’ responses as the data sets, the examination of the relationship between landscape characteristics is here restricted to the 11 pictures used. This small number of cases means that the results of the chi-squared test performed and logistic regression model applied in investigating the relationships between landscape characteristics lack statistical power. The results of a Spearman’s rho correlation between the ‘local’ and ‘universal’ determinants of preferences identified are reported in Table 3.4. Once again, the small number of cases used in the investigation means that most of the results obtained are not significant at the 5 per cent level. Those that are reliable suggest that there is some relationship between ‘local’ and ‘universal’ aspects of landscape preferences. This is particularly the case with the local variable, ‘extent of forestation’, which shows reasonably strong relationships with coherence, complexity and legibility. However, with the exception of coherence, these variables have a negative relationship with the extent of forestation.

Kevin Marsh 69 Table 3.4 R-matrix: Spearman’s rho correlation coefficients between landscape characteristics

Local

Lushness

Forest

Universal coherence

Complexity

Water

Legibility Mystery

0.467 p = 0.074 n = 11 0.826 p = 0.001 n = 11

−0.502 p = 0.058 n = 11 −0.748 p = 0.004 n = 11

0.293 p = 0.191 n = 11 0.213 p = 0.265 n = 11

−0.679 p = 0.011 n = 11 −0.748 p = 0.004 n = 11

0.055 p = 0.437 n = 11 −0.232 p = 0.246 n = 11

Discussion and conclusion Assessment of Piaget’s genetic epistemology as an interactionist model of environmental preferences In our discussion of the application of Piaget’s genetic epistemology to the understanding of the structure and source of environmental preferences, we hypothesized that the relative contribution of ‘local’ and ‘universal’ aspects of preference determination would be such that: 1. Both local factors and underlying universalities contribute to preference determination. 2. Local factors dominate universal factors in determining preference. 3. There is a relationship between local and universal factors in preference determination. The tests run on the data collected go some way to assessing these hypotheses, but do not go far enough to rule conclusively on the claims. The results of the chi-squared test, Cramer’s V-test and the logistic regression model suggest, in support of proposition 1, that there is a relationship between landscape preferences and each of the local and universal aspects of preference determination identified. Moreover, in support of proposition 2, the Cramer’s V-test suggests that the strongest relationship is between the extent of forestation, a local factor, and preferences. The idea that local factors dominate in the prediction of preferences is further supported by the logistic regression model, which shows that the extent of forestation accounts for a significant part of the variation explained by the model. The tests run also point to the


existence of the relationship between local and universal factors hypothesized in proposition 3. However, there are a number of limitations to the model developed and the tests performed that must be highlighted in assessing the hypothesis. First, both the mystery and the lushness of the landscape have a negative relationship with preferences, and thus contradict the hypothesis. Second, there is still a large amount of variation in preferences unaccounted for by the application of the logistic regression model based on all seven variables. Third, our attempts to investigate the relationship between local and universal elements in preference determination, perhaps the most important proposition in the hypothesis, suffer from a lack of statistical power. Thus, the tests that might have revealed most about this relationship, for instance the development of a logistic regression model, produce statistically invalid results. Finally, the statistically valid results that are obtained for testing this relationship indicate relationships between local and universal elements in preference determination opposite to those hypothesized, that is, a strong negative relationship between local and universal factors. Thus, while the results suggest some correspondence between the data and the hypothesis that Piaget’s genetic epistemology provides a model for environmental preferences, we are far from being able to conclude that it provides a convincing interactionist model. This is partly a methodological issue, and there are various ways in which problems such as the lack of statistical power of some if the tests performed can be combated. However, rather than concerning ourselves with debates concerning methodological issues that can be accessed elsewhere, it is important in closing to consider the more fundamental, theoretical objections to attempts within the social sciences to explore the middle group between nature and nurture.

The social scientific methods and the possibility of investigating the interaction of nature and nurture One way to react to the apparent inconsistencies between the analysis performed and the hypothesis being tested would be to suggest that the local and universal elements in preference determination identified for use in the analysis are incorrect and that a more accurate depiction of these variables might produce more favourable results. For instance, it might be suggested that it is wrong to treat each of the universal elements as having equal importance in the determination of preferences, and

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that the interaction of these elements needs to be considered in defining the universal principles underlying preference determination. Consistent with this line of argument would be the suggestion that the negative correlations between preferences and the landscape characteristics of mystery and lushness could be explained through proposing stages in the application of universal aspects of preference determination. For instance, Kaplan (1992) proposed a two-stage model of preference determination in which the presence of the landscape characteristics of coherence and complexity are inquired of first. Only if preference decisions cannot be made at this stage do mystery and legibility enter into preference determination. In the case where preferences are decided at the first stage, it may well be the case that mystery and legibility display a poor correlation with preference. This argument raises a fundamental objection to the attempt within the social sciences to explore the middle ground between nature and nurture and model the interaction of universal and local influences on values and behaviour: How can we distinguish between universal and local influences in order that their interaction might be tested? That is, the influences of nature and nurture are identified and distinguished through the observation of behaviour, which is itself the result of the interaction of nature and nurture. Before any interactionist model can be developed and tested, assumptions have to be made with regard to the relative contribution of nature and nurture so that the elements of behaviour that reflect the influences of nature and nurture can be identified and distinguished. That is, assumptions have to be made as to the nature of the interactionist model in order to determine the form of the variables used in the testing of the model, thus fundamentally undermining the model. Consequently, the impossibility of assigning predictors as representing only local or universal influences undermines any attempt to determine the relative contribution of local and universal factors to preference. A similar point is made by Brown (1991, p. 89) in his comprehensive study of human universals when he considers the problems in distinguishing universals: ‘[E]very universal is equally a correlate of every other, so the degree of correlation between any of them ceases to be a criterion for judging arguments that posit connections between them.’ Based upon this argument, he goes on to identify a range of possibilities for explaining universals: explaining a universal from a universal; cultural reflection upon or recognition of biological facts; logical extension from (usually biological) givens; diffusionist explanations that rest upon the great age of the trait and, usually, its great utility;


archoses; conservation of energy; the nature of the human organizm, with emphasis on the brain; evolutionary theory; interspecific comparison; ontogeny; and partial explanations. It is a similar argument that causes Ulrich (1993) to conclude that the innate nature of environmental preferences cannot be derived from their commonality. Ulrich doubts the validity of the argument that such similarities in preference are genetic in origin, owing to the insufficiency of the method involved. He suggests that to determine the exact nature of the genetic influence behind conceptions of nature requires ‘behaviour-genetic methods’ – for instance, the use of twin registers, laboratory-based experiments, the use of physiological techniques such as facial electromyography (EMG), the response of young children to natural stimuli, and the use of a high-resolution PET (positron emission tomography) scanner to locate the position of brain activity during the processing of natural verses modern stimuli. The trouble facing the social sciences in investigating this ‘middle ground’ between nature and nurture is highlighted by the fact that even the highly sophisticated techniques proposed by Ulrich have failed so far to produce any conclusive results. For instance, researchers on intelligence compare identical twins, fraternal twins and ordinary siblings and end up using complicated formulas to compute hereditability estimates, and even then there is great controversy over whether they have achieved their goal. These problems facing the exploration of the interactionist approach to understanding environmental preferences are a manifestation of the fundamental epistemological problems facing the naturalistic project in the social and behavioural sciences: the explanation of actions by reference to beliefs or desires. What is referred to as a folk-psychological explanation of human action adopts the ‘covering law’ theory of the scientific method, namely that an event can be deduced from a set of one or more laws of nature and a description of ‘initial conditions’. This folk psychology tends to be of the following form (Rosenberg, 1995): [L] If any agent, x, wants d, and believes that a is a means to attain d under the circumstances, then x does a. However, attempting to determine the initial conditions in the social sciences – people’s beliefs and desires – raises methodological problems. Specifically, the only available measuring instrument for beliefs and desires is [L] itself. As Rosenberg (1995:40) states:

Kevin Marsh 73

If we know what someone’s beliefs and desires are, then [L] will tell us what actions she will undertake. If we know what actions a person has performed, and we know what her beliefs were, then [L] will tell us what her wants were. And if we know what she wanted and what actions she performed, then [L] will tell us what she believed. But without at least two of the three, belief, desire, and action, the others are not determinable. That is, in order to measure initial conditions, we must use [L]. Thus, as long as what is to be explained is an action, nothing could ever conceivably lead us to surrender [L]. [L] is unfalsifiable, and the impossibility of disconfirming [L] casts doubt on its claims to be a causal law, as it cannot provide empirical, scientific knowledge. It is exactly this problem – what Rosenberg (1995) refers to as the unfalsifiabilty of folk psychology – that underlies the problems facing the investigation of the interaction of nature and nurture. The approach attempts to work back from behaviours to beliefs and/or desires and, in doing so, requires further assumptions about the nature of the mind. In this case, people’s preferences are used to infer the form of universal and local influences upon environmental preferences. However, in doing so, assumptions are made regarding the nature of the mind. Thus, in identifying universal influences upon environmental preferences, a hypothesis has to be presented of the following form: Initial conditions

Hypothesis Therefore, Observation

1. Genetic evolution predisposes humans to prefer environments favourable to their survival. 2. Preferring characteristic X enhances a person’s chances of surviving a landscape. characteristic X is a genetically predisposed, universal preference. The landscapes preferred consistently possessed characteristic X.

A caveat to concluding in favour of this hypothesis is that learned preferences may favour the preference for X. As with the hypothesis that preferences are innate, the only way to test whether learned preferences do indeed favour the preference for X is to work back from the observation that people prefer X to learned preferences. However, the only links between behaviours and preferences are ‘covering laws’


relating the two. Once again, assumptions have to be made about the mind in determining the form of the covering law: Initial conditions

Hypothesis Therefore, Observation

1. People develop preference as a result of interactions with their environment. 2. People consistently experience characteristic X in their interaction with the environment. People learn to prefer characteristic X. The landscapes preferred consistently possessed characteristic X.

There is no other way of measuring the initial conditions – in this case people’s beliefs regarding the nature of humanity – in either of these covering-laws other than through the application of the coveringlaw. Thus, on the basis of the observation that people consistently prefer landscapes which possess characteristic X, there is no way of choosing between these two alternative hypotheses other than by pointing to different beliefs regarding the nature of the mind – by making assumptions. Hence, the investigation performed in this paper is unable to illuminate the form of the interaction of nature and nurture in determining environmental preferences. The most that can be derived from the investigation undertaken is that both local and universal elements contribute to the determination of environmental preferences. On its own this is hardly enlightening. As pointed out in the introduction, this is a widely held position. The important question that emerges from this finding is whether the social sciences have the available methods for going beyond this result and exploring the middle ground between nature and nurture. The intention of presenting the above investigation is to highlight some of the methodological issues important in developing a research agenda to explore potential interactionist models of human behaviour. These issues can be divided into the practical and the philosophical. While practical questions such as statistical power can be overcome through experimental design, it is the fundamental epistemological limitations of the naturalistic social scientific method that pose the greatest challenge to progression within this area. It is this obstacle that probably explains why approaches to issues such as the nature of environmental preferences have so long been polarised by the nature–culture dichotomy in the face of so much support for the notion of resolving this dispute in favour of a middle ground.

75

Appendix 1

76

77

78

79


Appendix 2 Landscape combinations presented to participants (i) 10, 9. (ii) 7, 2. (iii) 7, 9. (iv) 8, 1. (v) 1, 4. (vi) 6, 3. (vii) 11, 3. (viii) 8, 4. (ix) 11, 6. (x) 5, 1.

Notes 1. Complexity is an assessment of the scene in terms of its potential for exploration, involving the richness or number of different objects in the scene. A scene low in variability is unlikely to provide much to look at, and is unlikely to be worth exploration. 2. Coherence refers to the ease with which one can grasp or understand the organization of the scene. Repeating elements provide rapid assessment of how the scene hangs together. Fewer different regions, relatively uniform within themselves and clearly different from one another, also enhance coherence. 3. Legibility is an assessment of how well one can find one’s way in the depicted scene, the inference being that one will be able to maintain one’s orientation. A scene that is open and offers visual access, but with distinct and varied objects to provide landmarks, is high in legibility. 4. Mystery represents the promise of more information. The inference is that one could learn more about the scene if one could explore its third dimension. This is enhanced by characteristics such as screening in the foreground, or a winding path, features that suggest the presence of more information while at the same time partially obscuring it. 5. An appreciation of such variation can be had by comparing the preference model of Kaplan (1992) with that of Orians and Heerwagen (1992). 6. Several studies have suggested that people rate landscapes that they visited in much the same way that they rate surrogate photographs of these landscapes. See Lyons, (1983) and Ulrich, (1993) for summaries of this literature. 7. Details of the review of northern Thai landscape norms are not included within this paper. For discussions of Thai and Karen environmental norms and the social forces impacting upon these norms see Shrock (1970), Kunstadter (1983, 1989), Chalardchai (1989), Suvanna (1989), Yoshimatsu (1989), Hinton (1990), Anderson (1993), Chumpol (1997) and Prasert (1997). 8. A total of 4 people ranked the landscape pictures: 2 who had lived in Thailand their whole lives and 2 who had lived in England their whole lives. These rankings were averaged to provide the ranking used in the analysis.

Kevin Marsh 81 9. Tests were also performed using landscape characteristic ranking scales of 20 to −20 and 50 to −50 in order to assess the sensitivity of the analysis to the scales used. In each case, the scale used had no significant effect on the results obtained, each of which was of the same direction and similar magnitude.

References Anderson, E.F. (1993) Plants and People of the Golden Triangle. Ethnobotany of the Hill Tribes of Northern Thailand. Chiang Mai: Silkworm. Appleton, J. (1975) The Experience of Landscape. London: Wiley. Atran, S. (1990) Cognitive Foundations of Natural History. Cambridge University Press. Atran, S. (1995) ‘Causal constraints on categories and categorical constraints on biological reasoning across cultures’, in D. Sperber, D. Premack and A.J. Premack (eds), Causal Cognition. New York: Oxford University Press. Balling, J.D. and Falk, J.H. (1982), ‘Development of visual preference for natural environments’, Environment and Behaviour, 14(1), 5–28. Berlin, B. (1972) ‘Speculation on the growth of ethnobotanical nomenclature’, Language and Society, 1, 63–98. Berlin, B. (1978) ‘Ethnobiological classification’, in E. Rosch and B. Lloyd (eds), Cognition and Categorization. Hillsdale, NJ: Erlbaum. Bourassa, S.C. (1990) ‘A paradigm for landscape aesthetics’, Environment and Behaviour, 22(6), 787–812. Brown, D.E. (1991) Human Universals. New York: McGraw-Hill. Carey, S. (1995) ‘On the origin of causal understanding’, in D. Sperber, D. Premack and A.J. Premack (eds), Causal Cognition. New York: Oxford University Press. Chalardchai Ramitanondh (1989) ‘Forests and deforestation in thailand: a pandisciplinary approach’, in Siam Society (ed.), Culture and Environment in Thailand. Bankok, Thailand: Siam Society. Chumpol Maniratanavongsiri (1997) ‘Religion and social change: ethnic continuity and change among the Karen in Thailand’, in D. McCaskill and K. Kempe (eds), Development of Domestication? Indigenous peoples of SE Asia. Chiang Mai: Silkworm Books. Chomsky, N. (1988) Language and Problems of Knowledge. Cambridge, MA: MIT Press. Daniel, T.C. and Boster, R.C. (1976) Measuring Landscape Aesthetics: The Scenic Beauty Estimation Method. USDA Forest Service Research Paper RM-167. Ft Collins, CO: Rocky Mountain Forest and Range Experiment Station. Duncan, J.S. (1973) ‘Landscape taste as a symbol of group identity’, Geographic Review, 63, 344–55. Fodor, J. (1983) The Modularity of Mind. Cambridge, MA: MIT Press. Gould, S.J. (1991) Time’s Arrow, Time’s Cycle: Myth and Metaphor in the Discovery of Geological Time. London: Penguin. Greenbie, B.B. (1992) ‘The landscapes of social symbols’, in J.L. Nasar (ed.), Environmental Aesthetics, Theory, Research and Applications. Cambridge University Press. Hecht, M. (1975) ‘The decline of the grass lawn tradition in Tuscan’. Landscape, 19, 3–10.

82 Environmental Preference in Northern Thailand Hinton, P. (1990) ‘Karen territorial spirits in ethnographic, historical and political contexts with some interpretations’, Proceedings of the Fourth International Conference on Thai Studies, vol. III, Kunming, China, 11–13 May 1990. Hirschfeld, L.A. and Gelman, S.A. (1994) ‘Toward a topography of mind: an introduction to domain specificity’, in L.A. Hirschfeld and S.A. Gelman (eds), Mapping the Mind: Domain Specificity in Cognition and Culture. Cambridge University Press. Kaplan, S. (1992) ‘Environmental preference in a knowledge-seeking, knowledgeusing organism’, in J.H. Barkow, L. Cosmides and J. Tooby (eds), The Adapted Mind. Evolutionary Psychology and the Generation of Culture. New York: Oxford University Press. Keil, F.C. (1994) ‘The birth and nurturance of concepts by domains: the origins of concepts in living things’, in L.A. Hirschfeld and S.A. Gelman (eds), Mapping the Mind: Domain Specificity in Cognition and Culture. Cambridge University Press. Keil, F.C. (1995) ‘The growth of causal understandings of natural kinds’, in D. Sperber, D. Premack and A.J. Premack (eds), Causal Cognition. New York: Oxford University Press. Kitchener, R.F. (1986) Piaget’s Theory of Knowledge: Genetic Epistemology and Scientific Reason. New Haven, CT: Yale University Press. Kitchener, R.F. (2000) ‘Genetic epistemology’, in J. Dancy and E. Sosa (eds), A Companion to Epistemology. Oxford: Blackwell. Kunstadter, P. (1983) ‘Karen agro-forestry: processes, functions, and implications for socio-economic, demographic, and environmental change in Northern Thailand’, Mountain Research and Development, 3(4), 326–37. Kunstadter, P. (1989) ‘The end of the frontier: culture and environmental interactions in Thailand’, in Siam Society (ed.), Culture and Environment in Thailand. Bankok, Thailand: Siam Society. Lyons, E. (1983) ‘Demographic correlates of landscape preference’, Environment and Behaviour, 15(4), 487–511. Macia, A. (1979) ‘Visual perception of landscape: sex and personality differences’, in G.H. Elsner and R.C. Smardon (eds), Our National Landscape. USDA Forest Service General Technical Report PSW-35. Berkeley, CA. Miller, P. and Rutz, M. (1980) A Comparison of Scenic Preference Dimensions for Children and Adults. Presented at the annual meeting of the Council of Educators in Landscape Architecture, Madison, NY. Orians, G.H. and Heerwagen, J.H. (1992) ‘Evolved responses to landscapes’, in J.H. Barkow, L. Cosmides and J. Tooby (eds), The Adapted Mind: Evolutionary Psychology and the Generation of Culture. New York: Oxford University Press. Piaget, J. and Inhelder, B. (1966) The Psychology of the Child. London: Routledge. Pinker, S. (1997) How the Mind Works. London, Penguin. Prasert Trakarnsuphakorn (1997) ‘The wisdom of the Karen in natural resource conservation’, in D. McCaskill and K. Kempe (eds), Development of Domestication? Indigenous peoples of SE Asia. Chiang Mai: Silkworm. Rosenberg, A. (1995) Philosophy of Social Science, 2nd edn. Oxford: Westview. Shrock, J.L. (1970) Ethnographic Study Series: Minority groups in Thailand, Vol 3. Washington, DC: Department of the Army. Sperber, D. (1994) ‘The modularity of thought and the epidemiology of representations’, in L.A. Hirschfeld and S.A. Gelman (eds), Mapping the Mind: Domain Specificity in Cognition and Culture. Cambridge University Press.

Kevin Marsh 83 Suvanna Kriengkraipetch (1989) ‘Thai folk beliefs about animals and plants and attitudes towards nature’, in Siam Society (ed.), Culture and Environment in Thailand. Bankok, Thailand: Siam Society. Ulrich, R.S. (1993) ‘Biophilia, Biophobia, and Natural Landscapes’, in S.R. Kellert and E.O. Wilson (eds), The Biophilia Hypothesis. Washington, DC: Island Press. Wilson, E.O. (1984) Biophilia. Harvard University Press. Wilson, E.O. (1998) Consilience. London: Little, Brown. Yoshimatsu, K. (1989) The Karen World: The Cosmological and Ritual Belief Systems of the Sgaw Karen in Northwest Chiang Mai Province. Research report to the National Research Council of Thailand. Bangkok. Zube, E.H., Pitt, D.G. and Anderson, T.W. (1974) Perception and Measurement of Scenic Resources in the Connecticut River Valley. Amherst: University of Massachusetts. Zube, E.H., Pitt, D.G. and Evans, G.W. (1984) ‘A lifespan development study of landscape assessment’, Journal of Environmental Psychology 3, 115–28. Zuckerman, M., Ulrich, R.S. and MClaughlin, J. (1993) ‘Sensation seeking and affective reactions to nature paintings’, Personality and Individual Differences.


Part II Valuing the Environment


4 An Ecological and Economic Approach to Valuing River Quality Claire Johnstone

Summary This was an interdisciplinary research project that investigated how people perceive and respond to environmental quality, by observing how recreational behaviour is influenced by river quality, and by eliciting anglers’ preferences for different aspects of the recreational fishing experience. A central aim of the study was to estimate the economic value of a fishing trip and the value of changes in river quality. The study used an impact-pathway approach in a three-stage ecologicaleconomic model, which mapped environmental impacts to rivers, to their ecological condition and then to recreational use of them for angling. The study used an economic valuation technique – the travel cost method – in conjunction with a large body of environmental and ecological data.

Introduction The overall focus of the research was to explore a facet of human– environment interaction, namely the recreational use and quality of rivers. The research investigated how different types of human activity, such as urban and agricultural land use, impact upon various indicators of river quality, and how in turn river quality influences recreational use of rivers. A central aim and challenge of the research was to develop our understanding of how environmental and ecological impacts on rivers affect human welfare. The research focused on investigating and quantifying 87

88 Valuing River Quality

the relationship between the characteristics of a river site and recreational use of rivers for angling, using a variation of an economic valuation technique, the travel cost method.1 This information was then used to estimate a number of economic values of angling, and, second, values of changes in the river quality characteristics that were found to determine angling trips. A further aim of the research was to locate the estimated economic values within the context of the wider framework of values that people gain from interaction with natural environments. To this end, the research sought to investigate how important the different aspects of a fishing site, such as the landscape, the likelihood of catch, the ecological productivity of the river and the peacefulness and tranquillity of the site, were in determining anglers’ choice of fishing site. The analysis sought to conceptualize how these various aspects related to different kinds of values and benefits gained from a fishing trip: to consider, for example, whether the aesthetic and peacefulness of a river site confer the same type of benefits as the ecological productivity and likelihood of catch. A preliminary classification of the attributes of a fishing site and trip with respect to the types of values gained was attempted. The research was structured by a three-stage ecological-economic model, which sought first to investigate how human activities impact upon river catchments, second to relate these impacts on rivers to the ecological quality of rivers as measured by fish populations, and then in turn to relate these to the recreational use of rivers for angling. This model and research structure is shown diagramatically in Figure 4.1. The research model was designed to allow an interdisciplinary investigation into human–environment interaction rather than looking at the process in either purely economic or purely ecological terms. The interdisciplinary approach has meant that the extremely complex and ‘fuzzy’ nature of the ecological systems involved have been presented in

Theory

Economic use (A)

Date

Catchment pressures

Ecological condition

Environmental impacts

Stage 1

River quality

Stage 2

Fish populations

Economic use (B)

Stage 3

Recreational use

Stage 3

Figure 4.1

The ecological-economic model and structure of the research project

Claire Johnstone 89

a very simplified way: the intention of the model is primarily the quantification of the linkages or relationships between human activity and ecological/environmental quality, and was not intended to be a comprehensive predictive model but rather an exploration of certain important aspects. One of the challenges of the research was to determine the aspects of a river that influence the demand for angling through the inclusion of a wide range of indicators of river quality, which would subsequently permit an evaluation of the indicators that best represented both ecological and recreational ‘quality’. A further challenge was to develop a valuation model that linked ecological and recreational data so as to allow the economic estimates of recreational value to take account of these environmental and ecological river attributes.

Stage 1 of the model – catchment impacts on river In this initial stage of the research, the relationship between two types of catchment pressures or impacts and river quality was investigated. The study sample consisted of 10 ‘natural areas’ (English Nature, 1988) around England, which encompassed 303 river reaches – the geographical location of the study areas is shown in Figure 4.2. The two catchment pressures used were the land use and geology in the catchment. The land use information comprised the percentage cover of six different types of land use – forest, urban, arable agriculture, pasture agriculture, semi-natural and ‘other’ – and was derived from the ITE Land Cover Map of Great Britain (ITE, 1990). The predominant underlying geology in the catchment was a categorical variable representing one of six different types – limestone, sandstone, chalk, clay, igneous and peat/sands. The river quality indicators used covered three main types of indicator – river chemical, biological and habitat quality. The chemical and biological indicators chosen are those used by the Environment Agency in the monitoring and assessment of river condition (Environment Agency, 1998.) The chemical indicators are biological oxygen demand (BOD), dissolved oxygen (DO) and ammonia, which measure the level of organic pollution in stream, for example from effluent discharges from sewage treatment works. In addition, two further chemical quality indicators were used, orthophosphates (phosphorous) and nitrates (nitrogen). The biological quality indicators are those developed under the RIVPACS scheme, namely ‘Ntaxa’ and ‘ASPT’. NTaxa is a measure of the


Yorkshire Dales

Southern Magnesian Limestone Southern Pennines

The Fens Midland Plateau Midland Clay Pastures Berkshire and Marlborough Downs Exmoor and the Quantocks South Downs

South Devon

Figure 4.2

Geographical location of the study areas

Source: Adapted from the ‘Natural Areas’ classification system and reproduced with the kind permission of English Nature.

species richness of macroinvertebrates (such as beetles, worms, snails and so on.) of a river reach based on the predicted potential for that river type, and ASPT represents the pollution tolerance of the macroinvertebrates. These two measures can be viewed as proxies of habitat quality and organic pollution respectively. The last two indicators

Claire Johnstone 91

included in the model represent the physical structural condition of the river and river banks and the extent to which it has been artificially modified, the habitat modification score (HMS), and finally, a measure of the river flow rate, in terms of cubic metres of water per second. Ordinary least-squares (OLS) regression was used, and, after some transformation of the dataset and removal of outlying variables, found to be adequate to model the relationships between each of the river quality variables described above and the pattern of land use and geology in the catchment. The river quality indicators found to be best explained by the regression analysis were the levels of nitrates and orthophosphates in-stream; specifically, the level of nitrates was strongly linked to the percentage cover of arable agriculture, and orthophosphates to urban land use. The type of land use and geology also explained much of the variation in the levels of BOD and the biological quality indicators ASPT and Ntaxa. These findings were consistent with those of previous studies that have looked at the influence of catchment pressures on river quality (for example Johnes et al., 1996; Johnson et al., 1997; Bis et al., 2000; Fisher et al., 2000; Mander et al., 2000.)

Stage 2 of the model – river quality and fish populations The second stage of the ecological-economic model analysed the relationship between the river quality variables used in stage one of the model, namely the river chemical, biological and habitat quality, and a different measure of ecological quality, namely fish populations. The purpose of this was not only to explore the relationships between different measures of river quality but also to introduce a river quality measure that would, theoretically, be able to capture both human quality (in the form of angling) and ecological quality. Three variables were used to represent fishery quality: fish species richness, that is the number of fish species present in the river; fish density, that is the number of fish per 100 m 2; and fishery status, which was a categorical variable representing the predominant fish type in the river, that is game (salmon and trout) or coarse (perch, roach, chub and so on.) OLS was also used to model the relationships between the river quality and the fish population variables. In general the models did not explain as much of the variance in fish populations as the river catchment (stage 1) models; however this was expected, given that there were a number of data quality issues relating to the consistency in monitoring


and reporting on fish populations across the study areas. The fishery variable found to be best explained by river quality was the type of fish species in the river, salmon and trout being found only in rivers where organic and nutrient pollution were at low levels, with only coarse fish species being found where such pollutants were high. These findings (indirectly) support previous studies (for example Allan et al., 1997; Cuffney et al., 2000) that have found links between catchment pressures and the type of fish species rivers can support. In support of ecological theory, the analysis found that there was a statistically significant relationship between two different measures of species richness – the number of fish species present in the river and the biological quality indicator Ntaxa, which as noted above describes the numbers of macroinvertebrate families in the river. This finding suggests that, despite considerable data quality problems encountered using the fish population data, which included the probability that some of the relationships were obscured by external variables such as fish stocking, the datasets are fairly robust.

Stage 3 of the model – river quality and angling This stage explored the principal research question, namely that anglers’ choice of recreational fishing site is influenced by the quality characteristics of the site, and that welfare impacts resulting from pollution and ecological degradation can be estimated. This stage also explored the relative importance of different aspects of a fishing trip, and how these aspects reflect different types of values or benefits gained. A survey of freshwater anglers across the study areas was carried out over a period of approximately 6 months, from November 2000 to July 2001. The questionnaire asked anglers to state the rivers and river sites they had fished, the approximate number of times, and socio-economic data such as their age, occupation and home postcode, which could then be transformed into the distance and time information used in the travel cost model. The questionnaire also elicited anglers’ preferences for a number of aspects of a fishing trip. The survey generated 412 usable responses, which translated into around 1300 observations on sites fished, as each angler was asked to state up to five different rivers they had fished that year. The survey sample was found to be broadly representative of the angling population in this country with respect to age and income levels, with a slight gender bias, where male respondents were over-represented. The distribution of anglers’ fishing sites is shown in Figure 4.3.

Claire Johnstone 93

Yorkshire Dales

Southern Pennines Southern Magnesian Limestone

The Fens Midland MPPlateau Midland Clay Pastures

Berkshire and Marlborough Downs

Exmoor and the Quatocks South Downs

South Devon

Figure 4.3

Distribution of fishing sites

A number of analyses were carried out to investigate the relationship between river quality and choice of fishing site. Initially, a spatial analysis of the relationship involved importing the fishing site data into a geographical information system (GIS) and matching the river sites against


the Environment Agency’s river quality database. This database classifies all the monitored river reaches in England and Wales into six different quality categories, based on the underlying chemical and biological quality of the rivers, ranging from ‘very good’ to ‘bad’. Statistical tests were performed to assess whether the distribution of fishing sites across the six river quality categories was significant – a chi-squared analysis showed that the probability of the river quality categories not having an effect on the distribution of trips was lower than 0.001 per cent, or 1 in 10000. More formal econometric analyses were then carried out, where the number of trips was regressed against the travel cost and river quality indicators for each individual and each site fished. The travel cost and quality attributes of the local substitute sites, that is the sites that the respondent could have fished but chose not to, were also included in the model. The travel cost regression used a zero-inflated negative binomial count-data model, which predicted the likelihood of a fishing trip as a function of the cost and quality attributes of the set of alternative sites available to the individual, as shown in equation (4.1): Tij = a + α1 bij + α2 Q j1 + α3 Qj2 + . . . + α15 Qj15 + βiSEi + γjSbij + η1SQj1 + η2SQj2 + . . . + η15SQ j15 (4.1) where Tij = likelihood of individual i making a trip to site j b ij = travel cost of trip by individual i to site j Q j = quality characteristics of site SEi = age and wage of individuals i Sb ij = cost of substitute site j for individual i SQ j = quality characteristics of substitute sites The results of this count-data travel cost model showed that the river quality characteristics that were positive (+) and negative (−) predictors of fishing trips were as follows: the river flow rate (+); the level of nitrate and orthophosphate pollution instream (−); the level of dissolved oxygen (+); the species richness and habitat quality of the site as measured by the biological quality indicator Ntaxa (+); and, with some reservations on the robustness of the variable, the number of fish species instream (+). The same analysis was also carried out for two sub-samples of the data set, upland and lowland areas, and it was found that different variables predicted the likelihood of a trip in these sub-samples. In upland areas, species richness of macroinvertebrates, dissolved oxygen and the presence

Claire Johnstone 95 Number of visits D

Point observed

a

Vi 0 Vi 0 0

Cost Ci 0

Figure 4.4

Consumer surplus from Vi0 trips at cost Ci0

of salmon or trout in the river were significant, whereas the level of nutrient pollution and pollution tolerance of the biota were significant in lowland regions. Flow was significant in both sub-samples. The recreational value or consumer surplus per trip were estimated using expression (4.2): 2

– V i0 ----------2β

(4.2)

V i0 = number of trips per year to site i β = marginal coefficient on the cost of a trip This is illustrated in Figure 4.4. The marginal effects of the travel cost model were used to obtain the implied cost elasticity of trips, and from this, the value of β, for each angler and each site they fished. Mean per trip estimates were found to range between £6 for lowland areas and £30 for upland areas; the mean for the pooled data set was £14. Once this average per trip consumer surplus had been estimated, the values per trip of percentage changes in the river quality variables that had been found to predict trips were calculated. These values were calculated as percentage changes from the mean value of the variable. As an illustrative example, Table 4.1 shows the values of a 10 per cent

96 Valuing River Quality Table 4.1 Angling values of a 10 per cent change (+ or −) per individual per trip (£2002) for the pooled data set of all 10 study areas River quality characteristics

Angling value

Numbers of fish species Macroinvertebrate diversity/ habitat quality Orthophosphates Nitrates Dissolved oxygen River flow rate (m3 per second)

£0.05 £0.10 £0.02 £0.04 £0.30 £0.42

change (increase or decrease) in the river quality variables found to predict trips for the pooled data set. 2 Anglers’ motivations for choosing where to fish were analyzed and the mean scores for each of the nine aspects is shown in Figure 4.5. This graph shows that the aspect of a fishing site that is considered to be most important in choosing where to fish is the landscape or natural surroundings at the site, although there are two other preferences or motivations for choosing a site that are very close to this in score: how quiet or uncongested the site is, and whether the river supports a fish species of interest. Fourth-most important was the how natural the river and river banks appeared, and, interestingly, the aspect of a river that

9.00 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00

Figure 4.5

Mean scores for the nine aspects of a fishing site

le ib Ed

al ci So

t os C

m e Ti

C

at

ch

l N

la po

pu

at

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ur a

n

et ui Q Fi sh

La nd s

ca

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0.00

Claire Johnstone 97

might be expected to be the most important – the likelihood of catch – was only found to be fifth-most important. These findings do however match those of a number of previous valuation studies that have elicited anglers’ preferences for various aspects of fishing sites. Peirson et al. (2001) and Spurgeon et al. (2001) found that relaxation, wildlife, landscape and the aesthetic value of the river site was considered most important to the enjoyment of a fishing trip. In a survey of anglers, House et al. (1994) found that ‘solitude, the catch and sociability’ were the main factors underlying anglers’ enjoyment of the river, and define ‘solitude’ as encompassing ‘peace and quiet, an attractive setting, a feeling of relaxation, a sense of freedom, seeing the wildlife’ (p. 35). Angling site preferences were also analysed in the two sub-samples, upland and lowland areas. This analysis showed that for 7 of the 10 site preferences (9 given plus ‘other’), anglers in both sub-samples had similar preferences, and while the mean scores differed slightly, their ranking in order of importance was not. There were 3 aspects of a site where anglers’ preferences in upland and lowland areas differed: the landscape or natural surroundings, how quiet and uncongested and, to a lesser extent, likelihood of catch. Most notably this analysis showed that anglers fishing in upland areas were more concerned that the river site would be quiet and uncongested, and anglers in lowland areas that the landscape and natural surroundings at the river site would be of high quality. This is perhaps to be expected, considering that beautiful and unspoilt river sites are likely to be less available in lowland areas, which in general have higher levels of urban or intensive agricultural development. Upland areas are often remote and away from centres of population, so the importance of peace and quiet to anglers fishing in upland areas is also expected. The only other slight difference between mean scores was that anglers in lowland regions ranked the likelihood of catch as fifth-most important to choice of site, and upland anglers ranked this aspect as being slightly less, at sixth-most important. These 9 aspects of a fishing site were grouped into 2 categories based on whether they were likely to contribute to utility-based or ‘service’ value, or well-being-based ‘psycho-spiritual’ value. This grouping showed that the intangible, well-being aspects of a fishing site were considered to be slightly more important overall than the tangible, consumptive aspects of a site. This preliminary categorization is reproduced in Table 4.2. Using this categorization and with reference to a number of studies in the field of environmental psychology (for example Hertzog et al., 1997),

98 Valuing River Quality Table 4.2

Classification of aspects of a fishing site by type of value gained

Psycho-spiritual/wellbeing benefits

Mean score

Consumptive/ service benefits

Mean score

Landscape/natural surroundings

7.88

7.80

Fishery quiet/uncongested

7.84

Natural appearance of river/river banks Socio-cultural (family and friends fish site)

7.62

Preferred fish species in river Likelihood of catch Travel time

5.43

3.04

Travel cost

3.72

Overall mean

6.59

Fish edible Overall mean

2.21 5.15

6.59

it is proposed that anglers would be less likely to be prepared to trade off the aspects of a trip that confer benefits in well-being, and thus the consumer surplus values generated in this study are more likely to relate to the aspects of a trip that provide consumptive/service benefits. Furthermore, this analysis suggests that qualitative valuation approaches (for example Kenyon et al., 2001; Satterfield, 2001) should form an important part of the valuation of natural resources that are (or will be) used for recreation and have aesthetic value. Where budget or time limitations constrain the extent to which qualitative valuations can be carried out, any derived economic values should at least be viewed as partial and in the context of this wider framework of values.

Conclusions There are a number of important findings of this research, which are briefly summarized here:

• First, the ecological-economic model has shown that human activities such as urban and agricultural land use result in impacts to rivers that can be mapped through different environmental and ecological media, which in turn affect recreational use of rivers for angling. • Second, both the spatial and the econometric analyses showed that various (depending on river type) river characteristics such as biodiversity and levels of pollution have measurable and quantifiable impacts on welfare, in terms of influencing anglers’ choice of recreational site.

Claire Johnstone 99

• Third, the qualitative information gathered in the angler survey showed that anglers consider the importance of the intangible or non-consumptive aspects of a fishing trip, which may contribute to a person’s psychological well-being, as at least, if not more, important than the consumptive or service-related aspects of a trip. • Last, the methodological approach and data used in this research suggests that some indicators of environmental quality are more likely than others to accurately reflect both anglers’ preferences and ecological quality,3 and that interdisciplinary models can provide valuable insights and input into policy-making.

Towards an environmental research agenda As noted above, this research has shown that an interdisciplinary approach, in terms of the research framework and data used, can provide useful information on human–environment interaction. While the model used in this study was of necessity broad-brush, both spatially and conceptually, and as such was carried out on a relatively coarse ecological scale, it was also inclusive and sought to investigate the links between different human activities, actions and perceptions and between different environmental media. Making such links is one of the key elements of more environmentally sustainable decision-making. There are a number of ways future interdisciplinary research could develop this field, both between natural and social sciences and between different social science disciplines. Future ecological-economic research could, for example, expand the range of different types of ecoregions in which the relationship between river quality and recreational use is explored, thereby generating more site-specific and policy-useful estimates of recreational value. In addition, other variables or indicators of river quality could be used in a travel cost model, perhaps including those which more closely match the aspects of fishing sites that this and previous surveys have found to be important to anglers, such as the aesthetic aspects of a site. Thinking more widely about the possibilities of future ecological-economic research, other types of recreation could be investigated, and perhaps the ecological-economic model could be adapted to a different environmental medium, such as woodland or coastal areas. With respect to future interdisciplinary research between social science disciplines, this study has highlighted a much needed field of enquiry that has begun to be addressed (see references in ‘Further reading’ below), namely, an investigation into the different kinds of


values and benefits which people gain from interaction with natural environments. This is likely to entail an understanding of ‘direct’ environmental values4 that is more in-depth and person-centred than traditionally conceived economic ‘use’ values, but also more inclusive, particularly bringing in perspectives and ideas from disciplines such as psychology and philosophy.

Notes 1. For a detailed discussion of this methodology, see Ward and Beal (2000). 2. A study was also carried out (not reported in this paper) of changes in consumer surplus per trip following changes in the river quality variables that were found to be significant predictors of fishing trips in the Upland and Lowland Areas. 3. Specifically, the biological quality indicators ‘ASPT’ and ‘NTaxa’ and levels of nutrient pollution (nitrates and orthophosphates) were found to be robust indicators of both human and ecological quality at all three stages of the model. In addition, the biological quality indicators are most stable over time, and thus offer a further added benefit as indicators of quality. 4. Meaning values that are gained through direct contact with natural environments.

References Allan, J.D., Erickson, D.L., and Fay, J. (1997) ‘The influence of catchment land use on stream integrity across multiple spatial scales’, Freshwater Biology, 37, 149–61. Bis, B., Zdanowicz, A., and Zalewski, M. (2000) ‘Effects of catchment properties on hydrochemistry, habitat complexity and invertebrate community structure in a lowland river’, Hydrobiologia, 422/423, 369–87. Cuffney, T.F., Meador, M.R., Porter, S.D. and Gurtz, M.E. (2000) ‘Responses of physical, chemical and biological indicators of water quality to a gradient of agricultural land use in the Yakama River Basin, Washington’, Environmental Monitoring and Assessment, 64, 259–70. English Nature (1988) Natural Areas: Nature Conservation in Context, CD-ROM. Peterborough. Environment Agency (1998) The State of the Environment in England and Wales: Freshwaters, London: Stationery Office, 1998. Fisher, D.S., Steiner, J.L., Endale, D.M., Stuedemann, J.A., Schomberg, H.H., Fransluebbers, A.J. and Wilkinson, S.R (2000) ‘The relationship of land use practices to surface water quality in the Upper Oconee Watershed of Georgia’, Forest Ecology and Management, 128, 39–48. Fisher, J. Sunman, H. and Tambe, N. (2002) The Environmental Benefits of the Environment Programme in the Periodic Review of the Water Industry (PR04), Environment Agency Economics Unit, Research Report No. 2002/1, Environment Agency: Bristol. House, M., Tanstall, S., Green, C., Partorand, J. and Claske, L. (1994) The Evaluation of the Recreational Benefits and Other Use Values from Alleviating Low Flows, R and D Note 258 for the National Rivers Authority by the Flood Hazard Research Centre, Middlesex University.

Claire Johnstone 101 Institute for Terrestrial Ecology (ITE) (1990) Land Cover Map of Great Britain. Grangeoves sards, Lancashire: Markewood. Johnes, P., Moss, B. and Phillips, G. (1996) ‘The determination of total nitrogen and total phosphorous concentrations in freshwaters from land use, stock headage and population data: testing of a model for use in conservation and water quality management’, Freshwater Biology, 36, 451–73. Johnson, L., Richards, B.C., Host, G.E. and Arthus, J.W. (1997) ‘Landscape influences on water chemistry in Midwestern stream ecosystems’, Freshwater Biology, 37, 193–208. Mander, V., Kull, A., Kuulemers, V., Tamm, T. (2000) ‘Nutrient runoff dynamics in a rural catchment: influence of land-use changes, climatic fluctuations and ecotechnological measures’, Ecological Engineering, 14, 405–17. Peirson, G., Tingley, D., Spurgeon, J. and Radford, A. (2001) ‘Economic evaluation of inland fisheries in England and Wales’, Fisheries Management and Ecology, 8, 415–24. Spurgeon, Colanello, G., Radford, A.F. and Tingley, D. (2001) Economic Evaluation of Inland Fisheries Module B: Indirect Economic Values Associated with Fisheries – National Angler Survey, Environment Agency R and D Project Record W2–039/PR/2, 2001. Ward, F.A. and Beal, D.J. (2000) Valuing Nature with Travel Cost Models: A Manual, Massachusetts: Edward Elgar Publishing.

Further reading Campos, D.G. (2002) ‘Assessing the value of nature: a transactional approach’, Environmental Ethics, 24, 57–74. Hanley, N. (2001) ‘Cost–benefit analysis and environmental policymaking’, Environment and Planning C: Government and Policy, 19, 103–18. Hertzog, T.R., Black, A.M., Fontaine, K.A. and Knotts, D.J. (1997) ‘Reflection and attentional recovery as distinctive benefits of restorative environments’, Journal of Environmental Psychology 17, 165–70. Kenyon, W., Hanleyard, N. and Nevion, C. (2001) ‘Citizens juries: an aid to environmental valuation?’, Environment and Planning C: Government and Policy, 19, 557–66. Lockwood, M. (1999) ‘Humans valuing nature: synthesizing insights from philosophy, psychology and economics’, Environmental Values, 8, 381–401. Satterfield, T. (2001) ‘In search of value literacy: suggestions for the elicitation of environmental values’, Environmental Values, 10, 331–59.

5 Willingness to Pay for Reduction in Risk of Mortality due to Air Pollution in Brazil: Preliminary Results Ramon Arigoni Ortiz1

Summary Epidemiological studies have reported significant associations between urban concentrations of air pollution and cardiovascular mortality and respiratory mortality. In this context, a governmental intervention is required to formulate policies that contribute to increase air quality, and cost–benefit analysis may be an important tool to evaluate the environmental legislation. Reductions in risk of death are arguably the most important benefit underlying environmental programmes that aim to reduce air pollution. Valuing health benefits associated with air pollution require site-specific parameters that demand a great effort of research and data collection. This study presents the several alternative methods and approaches used by environmental economists to estimate willingnessto-pay measures to reduce risks to life and presents some preliminary estimates for Brazil obtained through a contingent valuation study.

Introduction Air pollution is one of the most serious environmental health risks in Brazil, in particular in big cities like São Paulo and Rio de Janeiro. São Paulo is a large city with a remarkable industrial and economic strength. In consequence of its economic dynamics and also the high population density – more than 10 million people live within the urban area (IBGE, 2000) – the population faces serious environmental problems. For example, it presents one of the highest air pollutant concentration levels in the world. Furthermore, given its geographic characteristics, São Paulo is subject to thermal inversions that can lead to the increasing accumulation of atmospheric pollutants (Saldiva et al., 1995). 102

Ramon Arigoni Ortiz 103

Several studies have reported significant associations between urban concentrations of air pollution and all-cause mortality, cardiovascular mortality and respiratory mortality, plus deaths due to more specific causes such as pneumonia and chronic obstructive pulmonary disease (Saldiva et al., 1994, 1995; Gouveia and Fletcher, 2000b). Studies have provided evidence of positive associations between air pollution and several mortality causes, suggesting that fine particulate matter (PM 10) is the most harmful pollutant for human health. Pollutants such as sulphur dioxide (SO2 ), nitrogen dioxide (NO2) and ozone (O3) have also been related to health events (Pereira et al., 1998; Gouveia and Fletcher, 2000b). A governmental intervention is required to implement policies that aim to increase air quality, and cost–benefit analysis can be an interesting tool to evaluate the environmental legislation. The monetary evaluation of the health effects is an essential input to the cost–benefit analysis of any policy implementation, since these health effects seem to correspond to the major component of the benefits of policies to improve air quality. Reductions in risk of death are widely believed to be the most important benefit underlying many environmental programmes, including those concerned to reduce air pollution. Thus, when undertaking a cost–benefit analysis of environmental programmes that reduce air pollution, economists must estimate the benefit of reducing risks of death. Epidemiological studies also suggest that most of the statistical lives saved by reductions in air pollution are old people and those with chronically impaired health. Furthermore, exposure to pollution can result in delayed effects. When valuing improvements in exposure today that do not reduce risk of death until the future, policy-makers must know how much people will pay for future risk reductions. The general objective of this study involves (i) investigating how age influences the willingness-to-pay measures, (ii) examining the impact of current health status on willingness to pay and (iii) estimating willingness to pay for reduced future risks due to air pollution. Although these analyses were not performed in the actual research stage, some interesting figures can already be shown. Specifically, this report introduces preliminary descriptive statistics of the sample obtained in a recent survey and initial estimates of the willingness to pay to reduce probability of death in Brazil. The next section presents a brief literature review of the valuation methods and issues arising in risk valuation. Following that, some survey characteristics and results are presented.

104 Willingness to Pay for Mortality Risk Reduction

How environmental economists evaluate small risk reductions to human life In the context of risks to death (mortality) related to air pollution, several social costs and benefits are associated with policy-making and regulation, the most important of these benefits being the reduction in probabilities of premature death among the population exposed to pollutants. The success of risk management policies is, arguably, judged in terms of their effect on individuals’ expected utility. In order to allow reliable cost–benefit analysis, it is necessary to estimate as accurately as possible how individuals value the changes in their probabilities of death caused by certain environmental policies or programmes. The value of a statistical life (VSL) is a convenient figure for evaluating policies that reduce risk of death and is represented as the total willingness to pay (WTP) for the policy that results in one less death in the population. Johansson (1995) defines the value of a statistical life as the aggregate willingness to pay 2 for a measure saving a number of lives divided by the number of lives saved. Alternatively, the value of a statistical life is given by the mean, over the affected individuals, of their marginal rates of substitution between income and risk. The purpose of estimating the value of a statistical life is to provide some basis for policymaking involving social decisions. Researchers have identified two alternative general approaches for valuing the benefits of lifesaving activities, including environmental programmes that reduce risks of death: the human capital approach and the willingness-to-pay approach (Shepard and Zeckhauser, 1982; Cropper and Freeman, 1991; Johansson, 1995). The first approach, human capital, estimates measures of the economic productivity of the individual whose life is at risk. It uses an individual’s discounted lifetime earnings as its measure of value, assigning valuations in direct proportion to income. The willingness-to-pay approach assumes that the preferences of individuals can be characterised by substitutability between income and safety, that is, individuals make tradeoffs between consumption and goods or services that increase their safety. These tradeoffs reveal the values individuals place on their safety or on the reduction of the risk of death. The human capital approach has the appeal of being easy to use, but some ethical issues make it debatable, with several issues arising when implementing this simple approach to value an individual’s risk of death. The most important concerns the choice of a discount rate to calculate the present value of an individual’s future earnings. The human


capital value of a young person would be particularly sensitive to the discount rate utilized. Because of discounting and the time lag before a child becomes a productive participant in the labour market, the human capital approach places a much lower value on saving children’s lives compared with saving the lives of adults who are in the labour force. Furthermore, all the differences in the labour market structure are reflected in the human capital approach: because of earnings differences among individuals of different genders and races, the human capital approach values saving the lives of women and non-whites less than saving the lives of adult white males. Also, this approach assigns no value to retired or totally disabled people’s lives. Cropper and Freeman (1991) elicit some criticism of the human capital approach as provider of an approximated measure to the desired willingness-to-pay measures for small reductions in the risk of death. They argue that the most important criticism of the human capital approach is the inconsistency with the premises of welfare economics: it is each individual’s own preference that counts for establishing the economic values used in cost–benefit analysis. All the above issues suggest that human capital measures are poor proxies for the measure of willingness to pay for small changes in the risk of death. The willingness-to-pay approach has its basis in the assumption that changes in an individual’s economic welfare can be valued according to what they are willing (and able) to pay to achieve that change. According to this assumption, an individual treats longevity like other consumption goods and reveals his or her preferences through the choices that involve changes in the risk of death and other economic goods whose values can be measured in monetary terms. That is, in many situations an individual acts as if his or her preference functions included life expectancy or the probability of death as arguments, and make a variety of choices that involve trading off changes in their risk of death for other economic goods. When what is being changed can be measured in monetary terms, the individual willingness to pay is revealed by these choices, which are the basis of the economic value of reductions in the risk of death. The focus of the willingness-to-pay approach relies on the individualistic dimension of human behaviour, which means that the expressed willingness to pay to reduce the probability of death refers to the individual’s own risk. The underlying assumption is that the individual is the best judge of his or her own welfare, and even in matters including life and death individual preferences must be considered. Thus, the willingnessto-pay measure is a reasonable one to use in cost–benefit analysis.


However, because the probability of surviving is a normal good, income differences rather than preferences can explain some of the variance in willingness-to-pay estimates. In the health economic literature, some methods for the empirical estimation of willingness-to-pay measures have been utilized, each providing a means to derive Hicksian measures for individuals making tradeoffs between risks to life and health and other consumption goods and services. These are the compensating wage, the contingent valuation, the hedonic price (or hedonic property value) and the averting behaviour methods. According to Kuchler and Golan (1999), the compensating wage method is the predominant empirical approach to assess willingness to pay for risk reductions. It uses the labour market data on wage differentials for jobs with health risks and assumes that workers understand very well the workplace risk involved and that the additional wage that workers receive when they undertake risky positions reflects risk choice. In other words, the compensating wage approach relies on the assumption that workers will accept exposure to some level of risk in return for some compensation. In general, it is estimated as a hedonic wage function where wages are specified as a function of the personal characteristics of the worker – income, age, sex, education, and health status – and of the characteristics of the job. Among the latter, the fatality risk level of the job, benefits paid in case of injury on the job and benefits in the event of fatal accident can be cited as examples. Contingent valuation is a survey method in which respondents are asked to state their preferences in hypothetical or contingent markets, allowing analysts to estimate demands for goods or services that are not traded in markets. In general, a sample of individuals is drawn who are asked to imagine that there is a market where they can buy the good or service evaluated. The individuals state their individual willingness to pay for a change in the provision of the good or service, or their minimum compensation (willingness to accept) if the change is not carried out. Socio-economic characteristics of the respondents – gender, age, income, education and so on. – and demographic information are obtained as well. If it can be shown that individuals’ preferences are not random, but instead vary systematically and are conditioned to some observable demographic characteristics, then population information can be used to forecast the aggregate willingness to pay for the good or service evaluated. The contingent valuation method has been widely used for estimating environmental benefits in particular. The hedonic price model provides the basis for deriving welfare measures from observed differences in property prices. It is based on the


assumption that house characteristics yielding differences in health risks across houses should be reflected in property value differentials. Just as wages are higher in risky occupations to compensate workers for their increased risks to life, so property values may be lower in areas where lives are at risk in order to compensate residents for their increased risks. The property market is then used to infer the willingness to pay to reduce risk of death, through a hedonic price function. The averting behaviour method assumes that individuals spend money with certain activities that reduce their risk of death, like buying smoke detectors or seatbelts, and that these activities are pursued to the point where their marginal cost equals their marginal value of reduced risk of death. The marginal costs incurred by individuals to reduce their probability of death are used to value individuals’ willingness to pay to reduce their risk of death. Given individual data on the marginal costs of an averting good, which is likely to vary among individuals, especially considering the time costs associated with the averting good, and data on the effect of the averting good on the probability of death, can be an estimate made of the willingness to pay. The different approaches discussed are associated with both important advantages and important disadvantages. The human capital approach fails in that it is inconsistent with the premises of welfare economics, where the individual’s own preference is what counts for establishing the economic values used in cost–benefit analysis. This feature of the human capital approach indicates that the willingness-to-pay approach might be the best option to estimate the benefits of life-saving programmes, the objective of which is to reduce the probability of death. Given that the willingness-to-pay approach seems to be a better option for the purposes of this research, the next step involves the choice of an adequate valuation method. The major problem of the indirect methods, those where the individuals reveal their preferences through market decisions, is to isolate the risk–income tradeoff from other factors and to take into account the institutional restrictions of the observed markets (labour and property markets, for instance). Also, the application of these methods is limited to those risks that are traded in markets, when the need of information about the value of a change in the probability of death is greater in an area where no market exists, for example health or the environment. In particular, the compensating wage method estimates the value of a statistical life based on information about the labour market, from which old people are generally absent. Since an older person has fewer life-years remaining than a young one, the compensation received in


labour market studies may overstate the value of risk reductions to old people. The contingent valuation method overcomes the problems of the compensating wage method, but its disadvantage relies on the fact that little is known about the extent to which answers to hypothetical questions actually represent the respondent’s behaviour or preferences. It has become an important tool for evaluating change in the probability of death caused by public policies focused on safety, health or environmental expenditures. It is particularly attractive in situations where changes in death risks are not readily estimated using revealed preference techniques, also known as indirect valuation methods. In the particular context of this research, where one objective is to estimate the main benefit of air pollution reduction programmes – arguably the reduction in probability of death among old and impaired people – and given the limitations of other methods based on the willingness-to-pay approach, the contingent valuation method seems to be adequate for the purposes of the study.

The survey Recent studies have been developed using the contingent valuation framework to elicit willingness to pay for a reduction in risk of death related to air pollution (Alberini et al., 1997, 2001; Krupnick et al., 1997, 1999, 2000). Krupnick et al. (1997) first presented the survey instrument developed to fill some gaps in the contingent valuation literature concerning the elicitation of willingness to pay for reduction in risk of death. The gaps are related to internal inconsistency, that is, the way an individual perceives a small changes in his or her risk of death. The authors believed that part of this misperception is due to the way changes in risk are presented to the respondents, and attempted to develop a survey instrument that introduced basic concepts of probabilities. The first section of this instrument also proposed simple practice questions to familiarise the respondents with the probability concepts introduced. The second section presented leading-age and gender-specific causes of death and introduced common risk-mitigating behaviours, and the third section educated the respondents about the costs associated with risk-mitigating behaviours. The final section elicited information about the willingness to pay for risk reductions of a given magnitude that occur at a specified time. This survey instrument was adapted to the Brazil-specific characteristics and used to elicit the willingness-to-pay measure related to reductions


in risk of death in Brazil. The self-administered computer-based survey (i) targeted the 40–75-year-old population, (ii) discussed mortality risks in ten-year intervals, (iii) considered the change in risk corresponding to annual risk changes and (iv) considered the risk reduction as a private good. The first feature, (i), is appropriate considering that the goal of the survey is to discuss reduction in mortality risk in the context of environmental policy, and it is only in middle age that the risks of death from cancer, cardiovascular and respiratory diseases become significant. The use of ten-year intervals was important because it allowed risk to be represented in terms of chances per 1000, which can be represented graphically, facilitating the respondents’ comprehension of risk concepts. It used graphs containing 1000 squares to display probabilities of death, where white squares denoted chances of surviving, red squares chances of dying, and blue squares reductions in the risk of dying. Graphs were also used to illustrate the different timing of payments and risk reduction periods. Finally, the method of delivering risk reductions was considered as a private good, that is, neither covered by health insurance nor delivered by environmental programmes, which reduce the risk of death for all the population and not only the respondent. This feature can make the respondent think about his or her own risk and avoid free-rider behaviour. Respondents were also asked whether they had ever been diagnosed as suffering from any of several diseases, like cancer and chronic heart or lung disease. In addition, individuals were asked to respond to a series of questions in order to capture the severity of the disease and other chronic health conditions, physical and psychological. From these questions, it was possible to construct both physical health scores, for, say, energy/vitality and for general health, and a mental score, which measures symptoms of psychological distress. The willingness-to-pay section of the instrument introduced a baseline risk specific to age and gender. The respondent was then asked to consider two risk reductions occurring over the next ten years: the first reduced the baseline risk by in 5 to 1000, the second by 1 in 1000. The willingness-to-pay questions were then presented to the respondents for each baseline risk reduction, and finally another willingness to pay question was introduced regarding future risk reductions. This last question is specifically important for valuing environmental improvements related to conventional air pollutants and carcinogens, given that the benefit related to the risk reduction involved occurs in the future while the costs of implementing such improvements are incurred in the present.


The survey was conducted in São Paulo, Brazil, between 17 and 20 March 2003. The professional body contracted for sample selecting was an experienced firm with its own database consisting of thousands of individuals resident in São Paulo, their addresses and socio-economic profiles. The individuals selected in this database were contacted by telephone and invited to attend an interview in a computer lab at an agreed date and hour. An average of 70 interviews were performed per day, with ten computers used simultaneously from 9:00–19:00 daily. The criteria used in the sample selection involved the following:

• Residence in São Paulo. • Age 40–75 (percentages per age intervals reflecting the population statistics).

• Minimum literacy (read and write). • Membership of A, B or C social class (percentages reflecting the population statistics).

• Not having participated in the pilot survey (November–December 2002). The willingness-to-pay question format used in the survey was the closed-end format or dichotomous choice format with follow-up question. This meant offering a value (bid value) to the respondents and asking if they would be willing to pay that amount of money to buy the product that would reduce their probability of death in the next ten years. Depending on the respondent’s answer, another dichotomous choice question with a different value was posed. Independently of both answers, an open-ended question in the sequence asked what would be the maximum value the respondent would be willing to pay for the product. Table 5.1 shows the bid values used.

Table 5.1

Bid structure in the mortality risk survey (Brazilian reais – R$ 2003)

Group of respondents

Initial payment question

Follow-up question (if yes)

Follow-up question (if no)

1 2 3 4

240 600 1800 2700

600 1800 2700 3600

120 240 600 1800

Note: £1 = R$4.90 and US$1 = R$3.40, approximately, during the survey period.

Ramon Arigoni Ortiz 111 Table 5.2 Flag

Debriefs in the sample – risk comprehension

Description

Flag 0

Inconsistent willingness-to-pay values for both risk reductions valued. Flag 1 Wrong answer in the first probability test AND showing preference for having the higher risk of death. Flag 2 Wrong answer in the first probability test AND initially showing preference having the higher risk of death, but changing preference when asked to confirm. Flag 3 Showing preference for having the higher risk of death. Flag 4 Wrong answer in both probability tests. Flag 5 Showing preference for having the higher risk of death and confirmed. Flag 6 Stating they do not understand the probability well.

Occurrences, n

% of the sample with flag equal 1

81

28.6

15

5.3

10

3.5

72

25.4

32

11.3

28

9.9

38

13.4

Descriptive analysis of the sample Initially, a series of tests was performed involving the risk comprehension and the monetary values informed by the respondents. Two of them are considered particularly important and will be used in all statistics for comparison of the results. They refer to the flags 0 and 4, shown in Table 5.2. A flag 0 indicates the individual who reported inconsistent values in both risk reduction level questions. This means, for example, that the individual reported a maximum willingness to pay lower than the bid he or she had already accepted to pay, or stated a maximum willingness to pay greater than an amount he or she had refused before. It indicates that the respondent was not considering the bid values offered or was not paying the attention needed while responding the questionnaire. A flag 4 refers to an individual who gave wrong answers to both probability tests in the questionnaire. The first test was performed after a series of explanations and examples of the concept of probability had been given to all respondents. In the case of

112 Willingness to Pay for Mortality Risk Reduction Table 5.3

Descriptive statistics of the respondents (incomes in Brazilian reais) Total sample Without flag 0 = 1 Without flag 4 = 1

Variable

Observations (n) 283 % male 44.9 Age – mean (SD) 56 (9.46) Household monthly 1185 (1590) income – mean (SD) Individual monthly 844 (1140) income – mean (SD) Years of education 7.6 (4.2) % with health insurance 43.8 Table 5.4

202 45.5 56 (9.46) 1277 (1710)

251 45.0 55 (9.3) 1230 (1664)

912 (1273)

872 (1197)

7.9 (4.2) 41.6

7.8 (4.1) 42.6

Frequency by gender and age groups Age group

Total sample

Without flag 0 = 1 Without flag 4 = 1

Men Women Both Men Women Both Men Women Both

40–49

50–59

60–69

70–75

40–64

65–75

37 46 83 29 30 59 32 46 78

40 46 86 27 35 62 35 40 75

40 48 88 30 33 63 38 41 79

10 16 26 6 12 18 8 11 19

101 120 221 73 85 158 90 110 200

26 36 62 19 25 44 23 28 51

a wrong answer, a second test was performed. If the respondent gave another wrong answer, indicating a poor comprehension of the probability concept, then they were given a flag 4 equal to 1. The small sample obtained cannot be claimed to be representative of the population of São Paulo, a city of 10 million residents with around 2.5 million aged between 40 and 75. However, in general, the statistics related to the sample are similar to those related to the population of São Paulo. Tables 5.3 to 5.10 illustrate some characteristics of the sample; they are self-explanitary.

Preliminary willingness-to-pay measures The appropriate regression analyses to examine the effect of several factors on the reported willingness to pay and to estimate the median and mean willingness-to-pay values were not performed at this stage of the research. Alternatively, the Turnbull estimation technique was used to

Ramon Arigoni Ortiz 113 Table 5.5

Scenario acceptance

Percentage of respondents who . . .

Total sample

Without flag 0 = 1

Without flag 4 = 1

Did not believe the stated risks applied to them Had doubts about the product’s effectiveness Had doubts about the product’s effectiveness and stated that doubts affected willingness to pay Thought product might have side-effects Thought about other benefits of the product Said other benefits influenced willingness to pay Did not understand the payment scheme Did not consider whether they could afford the payment

22.3

23.8

20.7

36.4

35.6

36.2

12.7

11.9

12.3

36.4

35.6

35.1

48.4

46.5

50.2

8.1

7.4

7.6

11.7

13.4

11.9

71.4

69.8

70.9

Table 5.6

Objective and perceived risks – mean (standard deviation) in 1000

Risk

Total sample

Without flag 0 = 1

Without flag 4 = 1

Baseline risk of dying over the next 10 years (objective measure, assigned based on age and gender) Chance of surviving until age 70 (subjective measure, ranges from 0 to 100%)

219.9 (170.7)

220.5 (168.4)

213.3 (167.6)

40.0 (37.9)

40.7 (37.4)

40.9 (37.8)

compute distribution-free and conservative estimates of mean willingness to pay to reduce risk of death. This procedure involved using the responses to the initial (dichotomous choice) payment questions, and ignoring the responses to the follow-up questions to compute the relative frequencies of the given willingness-to-pay intervals. The Turnbull estimator 3 uses the choices of the respondents to construct an interval estimate for the latent willingness to pay implied by each respondent’s choice. By combining respondent’s choices, estimates of the relative frequency of responses at different willingness-to-pay intervals

114 Table 5.7

Health status of the Respondents (%)

Description

Total sample

Without flag 0 = 1

Without flag 4 = 1

Any of coronary, angina, heart attack, or other heart disease Any of emphysema, chronic bronchitis or asthma High blood pressure Any of the above (heart, lungs or high blood pressure occurrences) Has been diagnosed with cancer

23.0

20.8

23.1

16.2

15.8

16.7

34.6 50.9

32.7 49.0

33.1 50.6

9.5

7.9

8.4

Has visited emergency room or has been hospitalized in the last 5 years for respiratory or heart problems Judges their health to be very good or excellent relative to others of the same age

20.5

19.3

19.9

81.6

83.2

81.3

Table 5.8

Additional index scores – mean (standard deviation)

Index (1 to 100)

Total sample

Without flag 0 = 1

Without flag 4 = 1

Role-physical score – measures the extent of disability in everyday activities due to physical problems. Bodily pain score – measures the severity of bodily pain and resulting limitations in activities. General health score – measures the respondent’s perceived general health. Vitality score – measures energy level and fatigue. Social functioning score – measures the impact of either physical or emotional problems on the quantity and quality of social activities. Role-emotional score – measures the extent of disability in everyday activities due to emotional problems. Mental health score – measures respondent’s perceived mental health (happiness and peace of mind). Physical functioning score – measures the extent of disability in everyday activities due to general health problems.

77.0 (37.0)

80.4 (34.9)

79.5 (35.3)

82.3 (20.1)

83.5 (18.9)

83.5 (19.4)

67.5 (15.9)

68.2 (15.3)

68.2 (15.7)

62.6 (15.8)

62.8 (15.5)

63.5 (15.5)

74.7 (17.6)

76.0 (15.9)

75.6 (17.0)

76.3 (34.3)

78.5 (32.3)

78.1 (33.0)

65.8 (17.5)

66.0 (16.7)

67.4 (17.1)

72.2 (27.4)

76.1 (25.4)

74.4 (26.2)

Ramon Arigoni Ortiz 115 Table 5.9

Percentage of ‘yes’ responses to the initial payment question Initial bid (Brazilian reais – R$)

5-in-1000 risk reduction over 10 years – starting now

1-in-1000 risk reduction over 10 years – starting now

5-in-1000 risk reduction over 10 years – starting at age 70

240

600

1800

2700

Total sample Without flag 0 = 1 Without flag 4 = 1

77.8

68.2

67.1

59.7

75.9

64.6

59.6

50.0

78.1

67.2

65.6

63.1


70.8

51.5

43.8

54.2

66.7

37.5

26.9

39.6

68.7

53.4

45.3

58.5


71.1

61.0

57.1

54.9

65.7

46.4

48.3

54.0

72.5

64.9

62.2

58.3

are obtained. The lower-bound, non-parametric Turnbull mean is computed by assuming that the fraction of the sample estimated to be in each interval has a willingness-to-pay value equal to the lower end-point of the interval and then estimating the ordinary sample mean. It is calculated by multiplying the lower bound of the interval by the change in density for each interval, and then summing up the amounts obtained, as follows: n

WTPL =

∑ l j ⋅ pj

(5.1)

j=1

where: (lj) = lower bound of interval j ( pj ) = change in density in interval j Table 5.11 indicates the estimates produced when possible. The absent value represents the case where the percentage of ‘yes’ responses, shown in Table 5.9, did not decrease when the initial bid value offered increased. According to the Turnbull procedure, this assumption had to be satisfied in order to allow the observed percentages to be considered as the underlying cumulative density function of the probability that

116

Table 5.10 Respondents who reported willingness to pay equal to zero (per cent) The first line refers to possible protest responses, the second line refers to inconsistent responses and the third line is the total 5-in-1000 risk reduction over 10 starting now

1-in-1000 risk reduction over 10 starting now

5-in-1000 risk reduction over 10 starting at age 70

Total sample

Without flag 0 = 1

Without flag 4 = 1

Total sample

Without flag 0 = 1

Without flag 4 = 1

Total sample

Without flag 0 = 1

Without flag 4 = 1

17.7 7.8 25.5

24.7 7.4 32.1

17.1 6.8 23.9

29.7 3.2 32.9

40.6 2.0 42.6

27.5 3.2 30.7

15.2 2.5 17.7

18.3 3.0 21.3

14.3 2.0 16.3

Table 5.11

Non-parametric (lower bound) Turnbull estimation mean annual willingness to pay (US$ 2003)

Distribution-free and conservative estimates 5-in-1000 risk reduction over 10 years starting now

1-in-1000 risk reduction over 10 years starting now

5-in-1000 risk reduction over 10 years starting at age 70

Total sample 522.09

Total sample 277.36

Total sample 461.77

Without flag 0 = 1 464.74




Without flag 0 = 1 –


US$1 = R$3.40 during the survey period (March 2003)

117


the willingness to pay is inside that interval. The lacking estimates problem will be overcome when the appropriate regression analyses are performed.

Conclusions Recent epidemiological studies have identified associations between air pollution and deaths related to respiratory and cardiovascular disease and cancer, mainly among the elderly and infants and those with impaired health. The air pollution problem and its health consequences are particularly severe in big urban centres in the developing world, like in São Paulo, Brazil. When evaluating policies that aim to increase air quality in urban centres, the policy-makers must consider the main benefit of these policies, which is the reduction in the population’s probabilities of death. Valuing mortality benefits associated with reductions in air pollution levels is not a trivial task, requiring as it does site-specific parameters that demand a great effort of research and data collection. The several alternative methods and approaches used by environmental economists to estimate willingness-to-pay measures to reduce probabilities of death related to air pollution were discussed. A contingent valuation survey was recently conducted in São Paulo to assess the benefits associated with general policies that reduce the population’s risks of death. Given the research peculiarities, the estimates are particularly useful in analysing air pollution control programmes. The contingent valuation survey instrument used in the study was described, its main features were highlighted and a descriptive analysis of the sample obtained was shown. Also presented were the initial figures of the mean willingness to pay to reduce the probability of death. It must be emphasized that the estimates presented here are preliminary willingness-to-pay estimates using a non-parametric procedure, the Turnbull estimator. Refinements of these values will be possible when the appropriate regression analyses are performed in the near future.

Towards an environmental research agenda The issue of evaluating environmental programmes is linked closely to other areas of study, generally related to the ecological or physical phenomena being analysed. In this sense, the air pollution health-related problem is not an exception. The most important interdisciplinary link relates to medical or epidemiological researchers, who produce the dose–response functions needed to indicate the occurrences of health


outcomes – deaths or morbidity cases – that result from a given variation in each specific pollutant level. The dose–response functions are produced in time-series or cohort studies that statistically associate pollutant levels measured in different parts of the city with different health occurrences and several other climate-related variables. Given that the health outcomes are an essential input in air-pollution-related policies, the accuracy of the dose–response estimated parameters is decisive in policy analysing.

Notes 1. PhD research student, University of Bath. CNPq, an agency of the Brazilian government dedicated to scientific and technological development, supported the present study. 2. Willingness to pay in the context of risk to life is defined as ‘the breakeven payment, per unit reduction in the probability of death, that leaves an individual’s overall expected utility unchanged’ (Shepard and Zeckhauser, 1982). In a more general context, the willingness to pay for a specific good or service is the sum of the amount of money individuals spend on the good or service plus the consumer surplus measure associated with the consumption of this good or service. 3. For a detailed theoretical development of the Turnbull estimator, refer to Haab, T.C. and McConnell, K.E. (2002) Valuing environmental and natural resources: the econometrics of non-market valuation. Ch. 3 Cheltenham: Edward Elgar.

References Alberini, A., Cropper, M., Fu, T.T, Krupnick, A., Liu, J.T., Shaw, D. and Harrington, W. (1997) ‘Valuing health effects of air pollution in developing countries: the case of Taiwan’, Journal of Environmental Economics and Management, 34, 107–26. Alberini, A., Krupnick, A., Cropper, M., Simon, N. and Cook, J. (2001) ‘The willingness to pay for mortality risk reductions: a comparison of the United States and Canada’ (mimeo) paper prepared for inclusion in the FEEM Discussion Paper Series. Cropper, M. and Freeman, A.M. (1991) ‘Environmental Health Effects’, in J.B. Braden and C.D. Kolstad (eds), Measuring the Demand for Environmental Quality, Amsterdam: North-Holland. Gouveia, N. and Fletcher, T. (2000a) ‘Respiratory diseases in children and outdoor air Pollution in São Paulo, Brazil: a time-series study’, Occupational and Environmental Medicine, 57(7), 477–83. Gouveia, N. and Fletcher, T. (2000b) ‘Time series analysis of air pollution and mortality: effects by cause, age and socioeconomic status’, Journal of Epidemiological Community Health, n. 54, 750–5. IBGE (2000). Instituto Brasileiro de Geografia e Estatistica www.ibge.gov.br Censo Demográfico. Johansson, P.O. (1995) Evaluating Health Risks: An Economic Approach. New York: Cambridge University Press.

120 Willingness to Pay for Mortality Risk Reduction Krupnick, A., Alberini, A., Cropper, M. and Simon, N. (1999) ‘Mortality risk valuation for environmental policy’, Resource for the Future Discussion Paper, 99–47. www.rff.org Krupnick, A., Alberini, A., Cropper, M., Simon, N., O’Brien, B., Goeree, R. and Heintzelman, M. (2000) ‘Age, health and the willingness to pay for mortality risk reductions: a contingent valuation survey of Ontario residents’ (mimeo). Kuchler, F. and Golan, E. (1999) Assigning Values to Life: Comparing Methods for valuing health risks, Agricultural Economic Report no. 784, US Department of Agriculture. Pereira, L.A.A., Loomis, D., Conceicao, G.M.S., Braga, A.L.F., Arcas, R.M., Kishi, H.S., Singer, J.M., Bohm, G.M. and Saldiva, P.H.N. (1998) ‘Association between air pollution and intrauterine mortality in São Paulo, Brazil.’ Environmental Health Perspectives, 106(6), 325–9. Saldiva, P.H.N., Lichtenfels, A.J.F.C., Paiva, P.S.O., Barone, I.A., Parada, M.A.C., Martins, M.A., Massad, E., Pereira, J.C.R., Xavier, V.P., Singer, J.M. and Bohm, G.M. (1994) ‘Association between air pollution and mortality due to respiratory diseases in children in São Paulo, Brazil: a preliminary report’, Environmental Resources, 65, 218–25. Saldiva, P., Pope, C.A., Schawartz, J., Dockery, D. et al. (1995) ‘Air Pollution and mortality in elderly people: a time-series study in São Paulo, Brazil’, Archives of Environmental Health, 50(2), 159–63. Shepard, D.S. and Zeckhauser, R.J. (1982) ‘Life-cycle consumption and willingness to pay for increased survival’, in M.W. Jones-Lee (ed.), The Value of Life and Safety. Amsterdam: North-Holland.

Further reading Carrothers, T.J., Graham, J.D. and Evans, J. (1999) ‘Valuing the health effects of air pollution’, Risk in Perspective, 7(5). Freeman, A.M. (1993) The Measurement of Environmental and Resource Values: Theory and Methods. Washington, DC: Resources for the Future. Hammitt, J.K. (2000) ‘Valuing lifesaving: is contingent valuation useful?’, Risk in Perspective, 8(3). Jones-Lee, M.W., Hammerton, M. and Philips, P.R. (1985) ‘The value of safety: results of a national sample survey’, Economic Journal, 95, 49–72. Serôa Da Motta, R., Ortiz, R. and Ferreira, S.F. (1999) ‘Health and economic values for mortality and morbidity cases associated with air pollution in Brazil’, draft paper for presentation at the Expert Workshop on the Ancillary Benefits and Costs of GHG Mitigation Strategies, Resources for the Future, Washington, DC, 27–29 March 2000. Toley, G., Kenkel, D. and Fabian, R. (1994) Valuing Health for Policy: An Economic Approach. University of Chicago Press. Viscusi, W.K. and Aldy, J.E. (2003) The Value of a Statistical Life: A Critical Review of Market Estimates Throughout the World, NBER Working Paper no. 9487. http://www.nber.org/papers/w9487.

Part III Policy and Politics


6 Trade and Environment: Linkages in Multilateral Environmental Agreements Tim Taylor, Alistair Hunt and Anil Markandya

Summary The emergence of transboundary environmental problems, including climate change and the depletion of the ozone layer, has led to the establishment of a number of multilateral environmental agreements (MEAs). To date, over two hundred such agreements have been made. These MEAs may have important impacts on trade, either directly through trade measures or indirectly through the changing of relative prices through mitigation measures. This paper will investigate these impacts on trade of MEAs. This paper will review some of the main literature on the issue of trade impacts of MEAs to date, including the Montreal Protocol, CITES and the Basel Convention, before examining the potential trade impacts of the Kyoto Protocol or its successor. It then discusses issue linkage within a political economy framework and investigates key determinants of implementation for future MEAs. The trade and environment linkages within MEAs are discussed in the context of stakeholder analysis. This chapter forms part of an EC DG Research funded project Climate Change and Global Trade (CCGT) coordinated by ZEW, Germany.

Trade and environment: overview The linkages between trade and environment are complex. Many studies have attempted to identify and analyse these linkages, either 123

124 Trade and Environment: Linkages

through analysing the impacts of trade liberalization on the environment (for example CEC, 1999; Jha et al., 1999) or through investigating the impacts of environmental agreements on trade (for example Jha et al., 1999; Brack, 1996; Markandya and Milborrow, 1998). This section will give a brief introduction to the key issues within the trade and environment debate, before looking further at the latter case of the impact of multilateral environmental agreements on trade.

Trade liberalization and the environment The liberalization of trade is a key part of the modern world. With the development of free trade areas such as the European Union, NAFTA and others, the impact such liberalization will have on the environment is of increasing concern. Trade liberalization, thus, forms the backdrop to future multilateral environmental agreements, and hence we investigate briefly the impact that such liberalization may have had on the environment to date. The impact that the North American Free Trade Agreement (NAFTA) may have on the environment was investigated by CEC (1999), among others. They identified four key areas in which trade liberalization was linked to environmental change, notably:

• Changes in production, management and technology employed This can affect the environment in that if cleaner production methods are used, as a result of increased access to the technology or environmental regulation contained within the trade agreement, then the level of environmental degradation could fall. There could also be negative impacts if trade liberalization leads to increased output (the scale effect) and hence increased pollution. • Changes in physical infrastructure, including transportation networks It is suggested that NAFTA could lead to changes in environmental quality depending on the capacity of existing traffic networks, and hence the need for possible expansion, and through shifts to more environmentally friendly transportation methods. • Changes in social organization CEC suggested that ‘the NAFTA institutions may serve as the centre of a deepening North American community in which a sense of stewardship . . . grows.’ • Changes in government policy Government regulations may converge as a result of trade liberalization. The implications of this on the environment are that the level of environmental quality in countries with lower environmental standards may be expected to rise as these standards converge with those of the other countries.

Tim Taylor, Alistair Hunt and Anil Markandya 125

Studies on the effect that trade liberalization may have on the environment have reached conflicting conclusions. Boyd et al. (1993) suggested that for the case of the Philippines, tariff removal1 would result in substantial increases in deforestation. Cruz and Repetto (1993) found similar results in another Philippine study. However, a study of 25 Latin American countries from 1960 to 1988 found that openness of the economy was significant in explaining pollution intensity, with increased openness implying reduced intensity (Birdsall and Wheeler, 1992). Markandya (1999) reviewed the impacts of changes in trade regimes on developing countries and economies in transition by examining case-studies commissioned by UNCTAD and UNDP. For Brazil the situation was found to be one where some small moves towards trade liberalization have been accompanied by an upward trend in the level of environmentally harmful exports. In the case of China a more mixed picture was found. The use of new, cleaner technologies was accompanied by a dramatic expansion, particularly in small-scale industries. This expansion created significant ecological problems in some areas, including loss of biodiversity and natural resource depletion. For Poland, market reforms and trade liberalization were not distinguished in the study. However, the economy was seen to be moving from energy-intensive, heavy-engineering activities to a more Western mix of output. Markandya concludes that, for the 11 countries examined, the ‘studies do not provide emphatic evidence that trade liberalization has systematically hurt the environment’. In some cases the UNCTAD/ UNDP studies identified cases in which environmental pressures had fallen and others where they had increased, though where the latter were the case, policies were identified that would redress the situation with no negative impact on liberalization. To conclude, there is mixed evidence on the impact that trade liberalization may have on the environment. With the enlargement of the European Union looming ever nearer, this forms the setting in which any potential future multilateral environmental agreement will have an impact on trade. Hence, studies of the trade impacts of future MEAs should consider the changing world environment. We now examine the impact that multilateral environmental agreements have on trade.

Multilateral environmental agreements and trade Trade and environment are linked not only in the case of trade liberalization, but also when environmental protection measures may impact on trade. With growing awareness of transboundary environmental problems such as the depletion of the ozone layer and climate change


the need for international agreement on ways in which to mitigate or adapt to environmental degradation has arisen. As a result, over two hundred multilateral environmental agreements (MEAs) have been signed. These MEAs may have important implications for trade, either directly through trade restrictions2 or indirectly through changing production costs and hence prices. Brack et al. (2000) identify four main objectives for which direct trade restrictions have been applied in the design of MEAs:

• To restrict markets for environmentally hazardous products or goods produced unsustainably.

• To increase the coverage of the agreement’s provisions by encouraging governments to join and/or comply with the MEA.

• To prevent free riding by encouraging governments to join and/or comply with the MEA.

• To ensure the MEA’s effectiveness by preventing leakage. 3 However, the trade restrictions introduced as part of an MEA may fall foul of WTO regulations established to promoted free trade. A number of issues are of importance in this discussion, including:

• The hierarchical relationship between the WTO and MEAs – Developing countries have resisted efforts to give MEAs superiority in dispute resolution (Shahin, 1999). • The debate over Article XX – Article XX of GATT allows for measures ‘necessary to protect human, animal or plant life or health’ or ‘relating to the conservation of exhaustible natural resources if such measures are made effective in conjunction with restrictions on domestic production or consumption’. This article is the subject of some debate as to whether it allows scope for trade restrictions under MEAs. Esty (1994) notes that the article does not cover the atmosphere, the oceans, the ozone layer and other elements of the global commons. The issue of the definition of ‘like products’, which cannot be discriminated against under WTO rules, is also important. Article XX focuses on goods produced, not on the techniques used to produce them. Brack (1999) suggests that negotiations should be opened on a new WTO agreement on MEAs with trade provisions. Potential conflicts with the WTO must be taken into consideration in the design of trade measures in MEAs. The implications of some of the major MEAs for trade are reviewed in the next section.


Review of past experience with MEAs and implications for trade This section presents a qualitative review of previous work on MEAs and the trade impacts associated with them. Three major MEAs have been the subject of much investigation, notably the Montreal Protocol on substances that deplete the ozone layer, CITES and the Basel Convention. These are reviewed below, along with some recent work on possible trade implications of the Kyoto Protocol.

Montreal Protocol The Montreal Protocol on substances that deplete the ozone layer was established in 1987 as a result of growing international concern over the damage done to the ozone layer by ozone-depleting substances (ODS), including CFCs, halons and methyl bromide. The Montreal Protocol aimed to reduce consumption of ODS and included a number of provisions which impacted directly on trade in ODS and products containing or made with ODS. The protocol established a timetable for the phasing out of ODS, with industrialized countries aiming to be rid of the main CFCs by the start of 1996 and industrializing countries by 2010 (Brack, 1996). Trade provisions included restrictions on trade with non-signatories, which encouraged accession to the protocol, and ensuring that no country gained a competitive advantage by not acceding to the protocol. Brack (1996) concluded that the trade provisions contained in the Montreal Protocol were effective in reducing the extent of free riding and in preventing leakage, as there was no evidence of nations not signing in order to evade the controls. Markandya and Milborrow (1998) also concluded that trade restrictions, together with financial assistance to cover the costs of acceding to the protocol, played a key role in the acceptance of the protocol by all but 27 countries, a number of which are undergoing transition or have no stable government.

Trade impacts of the Montreal protocol The trade impacts of the Montreal Protocol were examined in Markandya and Milborrow (1998), using econometric analysis of the determinants of trade in ODSs for Belgium, the United Kingdom and the EU as a whole. The key results are presented in Table 6.1. As can be seen there, the Montreal Protocol had significant impacts on trade 4 between some of the areas considered in the study. In particular, ODS

128 Trade and Environment: Linkages Table 6.1 Impact of the Montreal Protocol on trade in ozone-depleting substances (per cent) Rest of World

Other EU

Other developed

Developing countries

Belgium

Imports Exports Years of impact

n.s. n.s.

n.s. 13.4 1989–94

−14 n.s. 1985–94

n.s. n.s.

UK


19.6 n.s. 1987–94

−10.9 −15.6 1989–93

ns 33.4 1987–94

25.6 6.7 1987–94

Europe


−11.5 −139 1989–93

n.a. n.a.

−10.4 n.s. 1989–93

−10 n.s. 1989–93

n.s., not statistically significant n.a., not applicable Source: Based on Markandya and Milborrow (1998).

imports from developing countries rose by 25.6 per cent in the UK, while European exports to the rest of the world fell dramatically. The Montreal Protocol also contained trade measures for goods containing ozone-depleting substances. The trade impacts for a number of regions and countries on trade in several goods containing ODSs were evaluated by Markandya and Milborrow (1998). The impacts of the protocol identified using regression analysis are shown in Table 6.2. This regression analysis included GDP as a determinant variable and for individual countries exchange rate variables were tried but found to be insignificant. The impact of the Montreal Protocol varied from region to region, with negative impacts on imports of non-domestic and domestic refrigeration. The most notable change was that of EC imports of air-conditioning machinery, which rose by 77 per cent over the period 1989 to 1993. The trade impacts for some developing countries of the Montreal Protocol were presented in Jha et al. (1999). The main findings were as follows:

• For Brazil, ODS-related exports declined by 45 per cent between 1989 and 1992, compared with a decline in exports of manufactured goods to the OECD of 7 per cent. Exports of products containing CFCs to developing countries rose quickly in the early 1990s, though this was side by side with growth in manufacturing exports. • For China, the volume of refrigerators exported fell 58 per cent between 1988 and 1991, with similar declines in other ODS-related goods. This led to an expansion of the phase-out programme.

Tim Taylor, Alistair Hunt and Anil Markandya 129 Table 6.2 Impact of the Montreal Protocol on trade in goods containing ODSs (per cent) Imports

Exports

Protocol impact (%)

Years

Sector

Protocol impact (%)

Non-domestic refrigeration EC OECD Asia Korea

−30 −26 −24 None

1990–92 1990–92 1986–88

None None None None

Air-conditioning machinery EC OECD Asia Singapore

77 37 None −27

1989–93 1989–93

−27 n.a. −28 n.a.

1986–88

Domestic refrigeration EC OECD Asia Singapore Malaysia Turkey Korea

−28 −28 None −28 −54 n.a. n.a.

1986–88 1989–90

−35 None −41 −37 n.a. None −53

1986–88

1989–91

1990–92 1986–88 n.a. n.a.

Years

1988–90

1988–90 1988–89

1988–89

n.a., not applicable. Source: Based on Markandya and Milborrow (1998).

• For Malaysia, close cooperation between government and industry in the phase-out strategy meant that ODS phase-out had little or no impact on trade and competitiveness.

Illegal trade and the Montreal Protocol Illegal trade is one potential problem for the credibility of the Montreal Protocol and other MEAs. Markandya and Milborrow recommended the following measures to counteract this:

• Demand-side measures to encourage industry to replace CFC-using equipment, for example fiscal exemptions or product endorsement for rapid conversions. • Alternatively, controls to be established for CFC sales, holding stockpiles or imports of recycled materials. • Closer monitoring of CFC production and trade.


• Greater cooperation between customs authorities and environmental agencies at national and international level, with a centralized intelligence unit being proposed. • Credible penalties for breaking the protocol.

‘Pollution havens’ and the Montreal Protocol The main findings in the literature on the Montreal Protocol and industrial location were the following:

• There was little evidence available to support the hypothesis that a •

• •

•

•

shift in production location occurred as a result of the Montreal Protocol, in line with most other findings on industrial production. Cases of shifts of a number of CFC-using enterprises from Hong Kong (then a British protectorate) to China reported by Lu et al. (1993) may have been due to less stringent phase-out schedules in China. However, the shift may also have been caused by a desire to gain access to the Chinese market. In Thailand, one study found an increase in ODS consumption by subsidiaries of transnationals (UNCTAD, 1995). Evidence is not available of a shift in production by multinationals from established factories in developed countries to those in developing ones. Even were this the case it should not be a matter of concern since ODSs will be needed in developing countries for some time. Targets established under the Montreal Protocol will still be met. Industrial migration is being restricted in some cases to prevent total consumption of ODSs rising above 0.3 kg per head. Such is the case in Malaysia, where the government is reluctant to allow foreign companies that may raise the level of ODS to set up for fear of losing the benefits of being a non-Annex 5.1 member. Adaptation to the new market was shown to be advantageous in the Chinese case, where manufacturers of refrigerators had to adopt new non-ODS-using technologies in order to meet demands of international buyers.

Thus, it can be concluded that industrial migration or the creation of ‘pollution havens’ has not been a major issue as a result of the Montreal Protocol. This is possibly due to the fact that few countries have not become party to the protocol, but also reflects wider evidence in the literature that other factors play a more important role in industrial location than environmental protection.


Conclusions The Montreal Protocol has proven itself to be one of the most successful MEAs to date. A large part of this success can be attributed to the trade provisions laid down within the protocol which encouraged accession and prevented free riding. Statistical analysis shows that the Protocol was an important determinant in trade of ODS and ODS-containing goods. Important lessons can be drawn for other MEAs in terms of the time-lag between accession and impact and also in terms of measures that have been identified to prevent illegal trade in the substance under consideration. There is little or no evidence in the literature to date of a ‘pollution haven effect’ arising from the application of the Montreal Protocol, and where it does exist then there may be other factors, such as market access, which determine the enterprise decision to relocate.

Convention on International Trade in Endangered Species (CITES) CITES came into force on 1 July 1975 and has a membership of 152 countries (CITES, 2001). These countries have banned commercial international trade in an agreed list of endangered species and regulate and monitor trade in species that might become endangered. CITES lists vulnerable species in one of three appendices:

• Appendix I Species ‘threatened with extinction and are or may be affected by trade’, for which trade is banned for primarily commercial purposes. • Appendix II Species not yet threatened with extinction, but which may become so if trade is not strictly regulated, for which trade is banned if the authorities in the exporting country deems export to be detrimental for species survival. • Appendix III Species listed by governments as subject to exploitation and needing regulation to restrict exploitation. The presentation of appropriate export documents at the time of importation is required for such species.

Trade impacts of CITES Trade impacts under CITES are restricted to impacts on the trade in protected species or goods made with such species. Trade measures under this convention have been suggested to cause unnecessary economic losses where the species under consideration are sustainably managed. Jha et al. (1999) give the example of Zimbabwe where there have been significant losses in trade of ivory and crocodiles, leading to stockpiling


of ivory valued at US$12 million. Recent measures to alleviate this problem have included the downlisting of elephants to Appendix II, allowing limited trade. In April 1999, the first trade in ivory for 10 years took place between Zimbabwe and Japan (AFP, 1999). Trade in products covered by CITES may represent only a small proportion of total exports. As such, only very small impacts on trade may be experienced. Such is the case in Costa Rica, though orchid dealers have complained of the impacts of a 5 per cent tax on imports of wildlife species, claiming these have reduced competitiveness (Markandya, 1999).

Basel Convention The Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal entered into force on 5 May 1992, having received 20 ratifications. In December 1998 there were 122 parties to the convention, with the United States being the most important non-signatory (Krueger, 1999). The trade provisions within the Basel Convention have been reviewed by Krueger (1999). They include the following:

• A ban on parties exporting wastes to countries that have prohibited their import.

• A ban on export of hazardous waste to ‘states that are parties neither to the Basel Convention nor to an agreement that is not less environmentally sound than the Convention’. • A ban on hazardous waste export to Antarctica. • Prohibition of export if reason exists to believe environmentally sound management or disposal is not available at the destination. Prohibition of trade with non-parties under Article 4.5 acts as a mechanism to encourage non-parties to join. The logic is similar to that of the trade provisions under the Montreal Protocol, in that non-parties must accede or lose trade with those that are party to the convention. Krueger argues this measure has been undermined by Article 11, which allows for agreements with non-parties as long as they are not less environmentally sound. Moves to ensure conformity with the convention were quashed by some industrialized countries due to fears over existing regional mechanisms not meeting the required standards.

Trade and environment impacts of the Basel Convention The loopholes provided within the Basel Convention have been exploited to some extent, with such agreements being made between


the US and Malaysia (1995), the US and Costa Rica (1997), and Germany for exports to Kazakhstan and Namibia, amongst others. Krueger reports that by August 1997, 25 bilateral and 9 regional or multilateral agreements were in existence. Hence, the trade impacts of the Basel Convention have not been as large as they may have been, due to this flexibility. Impacts identified in the literature are diverse:

• That trade restrictions on recyclable hazardous waste may restrict

• • •

•

•

access to secondary raw materials for non-OECD countries. Secondary raw materials are important in developing countries, for example imported battery scrap in India and the Philippines accounted for 60 to 70 per cent of lead consumption in the early 1990s ( Jha et al., 1999). Definitions of the nature of ‘hazardous waste’ are important in determining the trade impact (Johnstone, 1998). For LDCs the impact may be positive in terms of the environment, as they are protected against fake recycling schemes as a pretext for export. For Brazil, the impact of trade restrictions on the import of scrap metal could adversely impact on competitiveness, as scrap is imported to compensate for fluctuations in supply ( Jha et al., 1999). For Poland, trade restrictions have resulted in a large decline in the import of wastes. Some of these wastes, in particular scrap paper, were useful inputs into production. Exports of scrap metal have also fallen which may have some benefits. The loss of revenue from transport of waste may be important, particularly for the corridor between Ukraine and Russia (Jha et al., 1999). In Thailand, imports of hazardous waste rose dramatically, but under new regulations these imports were expected to fall.

‘Pollution havens’ and the Basel Convention The Basel Convention has at its core the idea of preventing the dumping of hazardous waste in developing countries without the resources to manage such wastes. In so far as this has resulted, such ‘pollution havens’ that existed due to differential regulations in these developing countries have been eradicated to a great extent. Illegal movements of waste are still of concern, however, and steps have been taken to prevent these.


In the intermediate years between accession to the convention and the raising of environmental regulations, some impact on trade has been experienced. Jha et al. (1999) cite the case of Thailand, where the importation of toxic waste rose considerably, but was predicted to fall dramatically as regulations came into force. Such a pollution haven effect may be seen as a temporary phenomenon.

Conclusions Trade restrictions form an important part of the Basel Convention. First, they encourage accession to the convention, though the extent to which these measures are important has been blunted by the inclusion of Article 11 in the convention. Second, they prevent the creation of pollution havens, though these have been seen in the short term in the immediate aftermath of the convention. Some significant trade impacts have been experienced as a result of the convention, particularly in the trade of recyclable goods. These trade impacts may have important implications for competitiveness in developing countries which rely on these goods as inputs in the production process.

Kyoto Protocol The potential for the application of trade measures within the framework of the Kyoto Protocol is discussed in Brack et al. (2000) in terms of feasibility, fairness and the interrelationship with the multilateral trading system. This section briefly reviews their main conclusions. In terms of feasibility, four main criteria are identified for the successful application of trade restrictions; the products should be: 1. 2. 3. 4.

limited in type and application; limited in origin; easily detectable; easily substitutable.

Brack et al. conclude that for the Montreal Protocol these criteria were met by the main ozone-depleting substances, CFCs. However, in the case of climate change trade restrictions would be more difficult to apply as GHGs tend to be by-products rather than traded products (though some GHGs, like HFCs, are traded). For traded goods, Brack et al. suggest that trade restrictions like those under the Montreal Protocol may be feasible. For by-products the conclusions are that restrictions on


GHG-related inputs or goods made with processes that produce GHGs would not meet any of the criteria for feasibility and if they were applied they would also result in a high welfare loss resulting from the severe restrictions on trade. In terms of fairness, a climate-change-related treaty with trade provisions is argued to be relatively fair. This is due to the fact that the scientific evidence is becoming more credible and the FCCC contains scope for equity considerations, by differentiating between developed and developing nations. The debate over the interaction between the WTO and multilateral environmental agreements continues, as mentioned earlier in this paper, and no firm conclusions are reached about the likely interactions between the Kyoto Protocol in particular and the WTO. The current Climate Change and Global Trade project, of which this paper forms part, will examine the trade implications of the Kyoto Protocol, including focusing on the flexibility mechanisms and impacts of EU enlargement. This will employ CGE modelling.

Conclusions Trade measures have been used to some effect in multilateral environmental agreements. Such restrictions have been useful in encouraging countries to sign MEAs, particularly in the case of the Montreal Protocol and, to a lesser extent, the Basel Convention. The impacts that some of the major MEAs have had on trade have been reviewed above. The main findings of this review are as follows:

Montreal Protocol • Trade measures incorporated within the Montreal Protocol were important in encouraging countries to sign up to the protocol.

• The trade impacts of the Montreal Protocol were significant, with large changes in the direction of trade of a number of goods, particularly refrigerators and air conditioning. • The impact on developing countries varied from country to country, depending on the degree of government cooperation with industry, amongst other factors. • Measures are needed to prevent against illegal traffic in prohibited substances. • Industrial migration as a result of the Montreal Protocol has not been a major issue. This is possibly due to the number of parties, but also reflects wider evidence of the location of industry.


CITES • Under CITES the trade impacts have not been large, in part owing to the small proportion of total trade that trade in endangered species and related products represents. • Some economic losses may have been experienced as a result of the listing of species as a whole rather than species in selected areas which are at risk of extinction. The Zimbabwean elephant case is one possible example, though steps have been taken to allow limited trade in ivory from Zimbabwe.

Basel Convention • Trade provisions within the Basel Convention to encourage countries to become party to the convention have been weakened by allowances for waste to be traded with non-parties as long as agreements are not less environmentally sound (Article 11). • For developing countries, impacts on the import of waste used as secondary sources of raw materials may be important for industrial competitiveness. • There is some evidence of temporary increases in the import of toxic wastes to Thailand. However, as new legislation is passed this is predicted to fall dramatically.

Stakeholder analysis The preceding review of MEAs has shown that the adoption of trade sanctions within these agreements has not noticeably reduced support for participation and seems likely to have acted as an incentive towards compliance with the agreements. This is particularly the case for the Montreal Protocol, though there remains the possibility that the success to date for this policy is more dependent on the general recognition that ozone depletion is a real and serious threat to human health than on the threat of sanctions. The positive role of trade sanctions within future MEAs is, however, always likely to be contingent on the acceptability of the measure within society. Analysis of historical experience is therefore limited to the extent that interest groups are likely to have different influences in each new context. This section briefly indicates how stakeholder analysis can be used to add a layer of contextual realism to the overall analysis of whether trade sanctions are likely to be adopted within


an MEA, using the climate change policy context as an example for illustrative purposes. The aim of a stakeholder analysis is to identify those whose interests will be, or are being, affected by the suggested policy option, and to assess the potential influence they may have on the decision problem. The techniques used to identify the stakeholders can range from the formal (for example interviews) to the informal (for example press reviews). Option formulators and implementers should be expected to be aware of who the cast of stakeholders are likely to be, though this can be supplemented by the use of group consultations and so on. Once a cast of stakeholders has been identified it is helpful to have systems of categorisation. One such system, shown in DFID (1995), categorises stakeholders as:

• Primary: those ultimately affected by the option, positively or negatively.

• Secondary: those involved in the delivering of the option, including those involved in the decision-making and those excluded.

• Key: those who may be indirectly affected by the option, but who may exercise a large degree of influence that can affect the intervention. When considering whether to introduce trade sanctions to help enforce an MEA – such as those that may arise from the Kyoto Protocol or its successor – the primary stakeholder group may include households that have to pay higher prices for domestically produced goods and the industries in the signatory country that are affected by a shift in demand towards their products or by higher input costs. Within the non-signatory countries, energy-intensive exporting industries and subsequently impacted households are also primary stakeholders. The secondary stakeholders might include the national governments of the signatory countries and perhaps the UNFCCC, as well as non-signatory country governments. The key stakeholders might include environmental NGOs and energy producers. Once stakeholders are identified and categorised the next step is to assess their interest in, and potential impact on, the option. Once again, a range of formal and informal research techniques may be used to gather information on the ways different stakeholders have an interest in the option and the ways they might influence a option. The importance of the different stakeholders in the policy objectives of the decision-maker, and the amount of influence that different stakeholders can bring to bear on an option, are therefore assessed. A matrix can


Low importance High importance

then be constructed to locate stakeholders. The stakeholders identified in the climate change context are plotted in the matrix shown as Figure 6.1. Importance, on the vertical axis, means the extent to which the needs and interests of a particular group of stakeholders are regarded as a priority by the decision-maker. The horizontal axis ranks the amount of influence they may bring to bear. Clearly, the analytical framework is common to the consideration of decisions relating to accession to any MEA. The matrix is used as an impressionistic tool to rank the importance and influence of stakeholders in relation to each other. An analysis of the relationships between the stakeholder views and the intervention objective – in this case, the imposition of trade sanctions – is the key output of a stakeholder analysis. In particular, it is necessary to assess the risks posed by the stakeholder views to the possibility of the option achieving its objective. Where stakeholders are identified as having considerable potential influence on the option, they represent a considerable risk to its implementation. This then leads to consideration of how such risks should be managed. In the climate change enforcement context, formal negotiation between UNFCCC participants has not begun on the possible use of trade sanctions as an enforcement tool. It is therefore not possible to ascertain all stakeholder views. Nevertheless, it is clear that the key relationship is

Low influence

High influence

1, 2, 3, 4

5, 6,10

7, 8, 9

Figure 6.1 Climate change MEA stakeholder matrix when considering imposition of trade sanctions. Primary stakeholders: 1, households (signatory country); 2, households (non-signatory country); 3, import substitution industries (signatory country); 4, energy-intensive industries (non-signatory country). Secondary stakeholders: 5, signatory country governments; 6, non-signatory country governments; 7, UNFCCC; 8, WTO. Key stakeholders: 9, environmental NGOs; 10, energy producers


likely to be between the signatory and non-signatory governments (both having high importance and high influence), now that the US is planning to reverse its signature. Specifically, since the US is a major export market for the EU it is foreseeable that the EU will not press for trade sanctions against non-signatory countries for fear of retaliatory action from the US. This is compounded by the uncertainty over the use of environmental trade barriers under the WTO rules, highlighted earlier. The second dimension of the analysis is to identify what assumptions need to be made about how stakeholders should act for an option to achieve its objective. If the assumption is too ambitious, then it may be that it should be regarded as what is sometimes known as a ‘killerassumption’ and the option specification should be revisited. In the climate change enforcement context, a principal assumption is that the trade sanction does not trigger a trade war, particularly between the EU and US. Whether this is the ‘killer assumption’ is not known, since the EU has made no formal statement as to its intention regarding policy towards non-signatory countries. To conclude, the views of different stakeholders are likely to have significant impacts on the implementation of any trade measures in climate-related MEAs. This section has identified some potential stakeholders that may be of importance and has indicated some of the key issues that may dictate their actions in creating or responding to the threat of trade restrictions. A more rigorous analysis will put more emphasis on the informal research approach by conducting in-depth interviews with stakeholder groups or surveys of them. This would, we hope, allow a greater degree of understanding of the flexibility of the positions that the actors take and therefore allow a more realistic appraisal of the possibilities of the MEA–trade linkage to be made.

Political economy of accession to a multilateral environmental agreement Governments must weigh the cost of accession, including intertemporal considerations, with the benefits in terms of improved environment. The net benefits of accession to an environmental agreement may be expressed as: NB = f(E, C, T, G, D, X) where E = the (discounted) environmental benefit over period t to the infinite future


C = the net direct costs of meeting the requirements of the treaty (including no-regrets options) T = the trade impacts G = the level of environmental awareness and participation D = the distributional implications of the MEA X = all other factors The net environmental benefit will depend on a number of factors, including the natural of the environmental problem in question. The impact may vary according to location of the country, the height above sea-level, the population size and many other factors. In the case of a global pollutant, such as climate change, the impact may be felt globally though the distribution of the benefits of mitigation strategies and reduced damages may be felt differently from country to country. The benefits of reducing the level of local pollutants, such as hazardous waste covered under the Basel Convention, may only be felt in the country in question. In weighing the decision of whether or not to accede to a MEA, it is obvious that the time horizon and discount rate applied may be crucial. Where the environmental benefit will be felt a long time ahead in the future, as is the case for example with climate change, then discounting the benefits has a large impact on the environment benefits derived from such a policy measure. For a discussion on intertemporal equity and climate change see Portney and Weyant (1999). However, where the impact is felt in the nearer term, as is the case with a reduction in the depletion of the ozone layer, then this implies that the environmental benefit will be larger in the minds of decision-makers. The net environmental benefit will depend not only on the timeframe of the environmental benefit but also on the environmental benefits taken into consideration by the government. This is particularly important in the climate change debate, with the contentious issue of the ancillary benefits of climate change mitigation. Ancillary benefits5 (or costs) are those benefits that arise as a consequence of a mitigation policy but are not the focus of the policy, for example health benefits. The inclusion or exclusion of such benefits (costs) may be of great importance in the decision as to whether or not to accede to a climatechange-related MEA such as the Kyoto Protocol. Estimates of the ancillary benefits of GHG mitigation range from a small percentage of mitigation costs (defined as C above) to largely offsetting these costs (Krupnick et al., 2000). A framework for the estimation of these benefits (costs) is provided in Krupnick et al. (2000).


The costs of meeting environmental standards depend critically on the costs of installing new technologies and the efficiency with which these new technologies work. This component of the net benefit function should decline with time, so delaying agreement may lower costs, although production may expand in the meantime, meaning that costs of adaptation would increase. The trade impacts would depend, as shown above in the review of trade and multilateral environmental agreements, on the nature of the commodity in question, the structure of the trade in that good and the extent to which trade sanctions may play a part in the MEA. This component may be crucial to signing a treaty, as was shown in the case of the Montreal Protocol. If the trade sanctions which may follow from non-signature of an MEA are large enough, these may affect the size and potentially the sign of the net benefits. The level of environmental awareness and participation may affect the extent to which the environmental benefits of an agreement are valued. However, they also may cause changes in voting patterns towards more environmentally friendly candidates. The extent to which this is important to accession may vary from country to country and across the electoral cycle. The distribution of impacts resulting from MEA implementation may have important implications in terms of political feasibility. Where the impact focuses on a politically active group, or an important interest group in society, then the implementation of such a policy may be stalled and render the policy infeasible. Thus, even if signing an MEA has a negative economic cost and has a low financial cost, if there are negative impacts on a key interest group this may affect the desirability of implementation in the eyes of the policy-maker. This problem was highlighted by Dixit (1996), who shows that, even in the case where compensation of the affected group is possible, credibility issues may render the policy impossible to implement. Thus, the distributional impacts on certain key interest groups in society may have important implications for the potential success of MEAs. As such stakeholder analysis, described above, will prove crucial to the design of the MEA to protect against barriers to implementation or accession. The distribution of impacts may also be important in terms of political feasibility if poorer sectors of the community are impacted. The degree of inequality in a country has a number of potential impacts, including increased social unrest and slower economic growth. The impact on the environment may also be negative. 6


The extent to which the different determinants are important in bringing about accession will vary across countries, governments and time. The nature of each variable will also vary according to the multilateral environmental agreement under consideration. First, we will examine the factors affecting the weights placed on each component of the payoff function. We will then examine the components within the frameworks of different MEAs. The weights attributed to different components of the net benefit payoff function will vary for a number of reasons. As noted above, the electoral cycle may be of importance in determining these weights. The weight given to environmental participation in elections may increase as time to the next election falls if the ‘green’ vote is important. The discount rate applied to far-off benefits may also change. The likelihood of remaining in office may affect a government’s willingness to commit to an environmental agreement. Where a government is unlikely to remain in office this may reduce the weight placed on the cost element, as it will fall on the incoming government. Political ideology may be important in determining the weight placed on various components of the net benefit payoff function. First, ‘green’ parties may place a higher weight (or lower discount rate in the case of climate change) on the net environmental benefit from acceding to an MEA. Second, the weight placed on distribution may vary according to the political ideology of the government in terms of the impacts on the richer and poorer sections of society, as well as on different industries. Governments may be less concerned about negative impacts on groups that do not form a major part of their support base. Political funding may also play a role where impacts on major industries fund political activities. A government for which industrial funding forms a major part of party income may place a greater weight on impacts on the relevant industries. The nature of government may also play a role in determining the weights. A democracy would probably be more likely to place weight on ‘green’ participation than a dictatorship. The weight applied to trade impacts may vary according to the overall importance of trade in the economy. They may also be correlated with the distributional implications of trade impacts, following the industrial funding of political activities as described above. The expected likelihood of application of sanctions may also determine the value of the trade impacts, which may be defined in expected value terms.


The relationship between the components of the payoff function and the likelihood of accession (or, put otherwise, the net benefits) need not be linear. It may be the case that small losses are valued more highly than small gains by voters, for example.

Application of framework to MEAs The above framework can be applied to existing MEAs and the Kyoto Protocol. In Table 6.3, estimates of the size of the impact on different countries are given for the Montreal Protocol and the Kyoto Protocol, based on a review of the literature on these two MEAs. The size of the impact and of the weights applied are open to some debate, though we believe those given are defendable. In the existing literature on the Montreal Protocol, the impacts of the trade regime have been identified as being particularly important in obtaining signatories to the protocol. However, as shown in Table 6.3 other factors may also have been of importance, notably the level of ‘green’ participation. The costs of adaptation to non-ODS also fell, with the development of new technologies. Expectations of this may have played an important role in accession. The literature also suggests that a lengthier phase-out period and financial supports may have played an important role in reducing costs to developing countries. In the case of the Kyoto Protocol, a major factor may be seen to be the expected environmental impact. Some scientific uncertainty as to the impacts has been identified, and some have argued that this uncertainty restricts the extent to which environmental benefits can be measured. Potential implications on industry also may be of importance to the Bush administration as a result of contributions by these stakeholders to campaign financing. These two factors may mean that the US government’s payoff function is quite different from that of the EU. Hence, negotiations have been made to reduce the cost element (and likely negative impacts on industry) by expanding the scope of the Kyoto flexibility mechanisms. The EU, however, seems to be accepting the IPCC evidence that climate change is due in part to human-made pollutants, and thus values the net environmental benefits more highly than the US. In different EU states the strength of industry and other stakeholders varies, consequently the extent to which distributional concerns are important in the EU will vary from country to country. The above is an illustrative view of the possible decision-making process undertaken by governments in the US, the EU and the developing countries. It represents a first step towards understanding the factors

144

Table 6.3

Political economy and multilateral environmental agreements (MEAs)7 Size of impact (weight)

MEA

Montreal Protocol OECD

Developing country

Kyoto Protocol US

E Environmental Impact

C Direct Costs

G Green Awareness

T Trade Impacts

D Distributional Impacts

Dependent on location (high)

Fairly low and reduced with R&D of ODS alternatives (fairly low) Higher than OECD, but reduced with technology transfer, financial supports and lengthier phase-out period

High (variable)

High (high)

Low (variable)

Low (probably low)

Potentially high (variable)

Low (variable)

Moderate (high) reducing with flexibility mechanisms and new technology Moderate (high) reducing with flexibility mechanisms and new technology Low – CDM and JI will reduce costs

High (low)

Uncertain probably high (high)

High (high)

High (high)

Uncertain probably high (high)

High (variable)

Low (probably low)

Probably low but positive (low)

Low (low)

Depends on location

Questionable – scientific uncertainty

EU

High (high)

Developing country

High (high)


that may be of importance in determining accession to the Kyoto Protocol. Although trade sanctions may play a role, their scope may be limited by the extent to which they conflict with WTO rules. Also, the threat of retaliation may be significant enough to prevent parties from placing trade restrictions on countries which are non-parties.

Conclusions and implications for future multilateral environmental agreements This paper has examined the linkages between trade and environment in terms of multilateral environmental agreements. First, we suggest that the trade impacts of MEAs must be considered in the context of increasing trade liberalization, including the expansion of the European Union. Second, the impact of potential conflicts with the WTO and the MEA have to be considered. Direct trade restrictions form part of a number of important multilateral environmental agreements, notably the Montreal Protocol, CITES and the Basel Convention. The trade impacts of these agreements varies, depending on the commodities concerned and the countries under consideration. Trade restrictions contained within MEAs have played an important part in expanding the coverage of the MEAs and thus should be considered important to the overall implementation of the agreement. There is little evidence of pollution havens resulting from those multilateral environmental agreements that have been reviewed. Some cases do exist, but can be explained through other factors such as attempts by industry to gain access to new markets through relocation. This is broadly in line with evidence in the literature on the location of industry. The actions of stakeholders in response to a multilateral environmental agreement may be central to the success or failure of the MEA in question. The positive role of trade sanctions within future MEAs is always likely to be contingent on the acceptability of the measure within society. As such, a review of stakeholder opinions is important, as is the determination of the importance of the stakeholder to the decision-maker and the amount of influence the stakeholder may bring to bear on the decisionmaking process. We present a framework for the evaluation of stakeholder opinions within the context of a climate-change-related MEA, which will be employed in a future study. Factors other than trade may be important in determining a policymaker’s attitude to accession to a multilateral environmental agreement. We develop a net benefit payoff function for governments deciding


about whether or not to accede to an MEA, including discussion of the determinants of weights placed on the different factors by policymakers. This is then applied for the cases of the Montreal Protocol and the Kyoto Protocol.

Notes 1. Boyd et al. (1993) considered the removal of tariffs existing in 1988. 2. Brack et al. (2000) point out that of the 200 MEAs in existence, around 20 incorporate trade measures. These include the Basel Convention on Hazardous Waste, CITES and the Montreal Protocol. 3. Brack et al. (2000) define leakage as ‘the situation where non-participants increase their emissions, or other unsustainable behaviour, as a result of the control measures taken by signatories’. 4. The impact of the Montreal Protocol was estimated by regressing imports/ exports on real GDP, exchange rate lagged one period and various 1–0 dummy variables to pick up trends after 1985 to proxy a protocol impact. 5. For a reviews of issues relating to ancillary benefits see IPCC (2001) and OECD (2000). 6. For a recent review of the impact of increased poverty on the environment see Markandya (2001). 7. The rankings in this table are based on what we believe may be the case, based on a review of the literature and of the media. For environmental impact, the Montreal Protocol is shown to be dependent on location, owing to the nature of the problems presented by the hole in the ozone layer. For climate change the same is true, however the overall impact is expected to be quite large. The level of weight attributed to this in the EU and DCs reflects the high media interest and importance of the issue in these areas. The costs of mitigation in the US and EU are shown to be moderate. This is because they reflect only a relatively small percentage of GDP (see IPCC, 2001). Flexibility mechanisms provide potential opportunities for reducing these costs. Some also argue that there are ‘no-regret’ options available. The extent of the ‘green’ vote varies by country, and the importance attributed may do also. In the case of the US, the weight attributed to this may be low, as industrial perspectives may be given more weight owing to political funding, employment and trade concerns. The trade impacts of the Kyoto Protocol are at present uncertain, though developed countries may be expected to bear the brunt of these impacts. The weight attributed in the US is high as the impact on competitiveness is a stated reason for non-ratification. The distributional implications may be seen to be high, as the impacts on key stakeholders, particularly industry, may be high in developed countries. Impacts on the poorer groups in DCs may be considered under the environmental cost component.

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Tim Taylor, Alistair Hunt and Anil Markandya 147 Birdsall, N. and Wheeler, D. (1992) ‘Trade policy and industrial pollution in Latin America: where are the pollution Havens?’, in P. Low (ed.) International Trade and the Environment, World Bank Discussion Papers no. 159. Washington, DC. Boyd, R., Hyde, W. and Krutilla, K. (1993) ‘Trade policy and environmental accounting: a case-study of structural adjustment and deforestation in the Philippines’ (mimeo). Athens, OH: Ohio University. Brack, D. (1996) International Trade and the Montreal Protocol. London: RIIA, Earthscan. Brack, D. (1999) ‘Environmental treaties and trade’, in G. Sampson and W.B. Chambers (eds), Trade, Environment, and the Millenium. New York: United Nations University Press. Brack, D., Grubb, M. and Windram, C. (2000) International Trade and Climate Change Policies. London: RIIA, Earthscan. CITES (2001) CITES website: www.cites.org. Commission for Environmental Cooperation (CEC) (1999) Assessing Environmental Effects of the North American Free Trade Association (NAFTA): An Analytical Framework (Phase II) and Issue Studies. Montreal. Cruz, W. and Repetto, R. (1993) The Environmental Effects of Stabilization and Structural Adjustment Programs: The Philippines Case. Washington, DC: World Resources Institute. DFID (1995) ‘How to Do Stakeholder Analysis’ Guidance Note, Social Development Division. Dixit, A. (1996) The Making of Economic Policy: A Transaction – Cost Politics Perspective. Cambridge, MA: MIT Press. Esty, D. (1994) Greening the GATT: Trade, Environment and the Future. Institute for International Economics, Washington, DC. IPCC (2001) Climate Change 2001: Mitigation. Cambridge University Press. Jha, V., Markandya, A. and Vossenaar, R. (1999) Reconciling Trade and the Environment. London: Elgar. Johnstone, N. (1998) ‘The implications of the Basel Convention for developing countries: the case of trade in non-ferrous metal-bearing waste’ Resources, Conservation and Recycling, 23(1), 1–28. Krueger, J. (1999) International Trade and the Basel Convention. London: RIIA, Earthscan. Krupnick, A., Burtraw, D. and Markandya, A. (2000) ‘The ancillary benefits and costs of climate change mitigation: a conceptual framework’, in OECD, Ancillary Benefits and Costs of Greenhouse Gas Mitigation. OECD. Lu et al. (1993) cited in Markandya and Milborrow (1998). Markandya, A. (1999) ‘Overview and lessons learnt’, chapter 1 in Jha et al. (1999) Markandya, A. (2001) ‘Poverty, Environment and Development’, in H. Folmer, H.L. Gabel, S. Gerking and A. Rose (eds), Frontiers of Environmental Economics. Cheltenham: Elgar. Markandya, A. and Milborrow, I. (1998) ‘Trade and industrial impacts of a multilateral agreement to phase out ozone-depleting substances – a case-study of the Montreal Protocol’, European Economy, 1, 39–90. OECD (2000) Ancillary Benefits and Costs of Greenhouse Gas Mitigation. Paris. Portney P.R., and Weyant J.P. (eds) (1999) ‘Discounting and Intergenerational Equity’, RFF Press.

148 Trade and Environment: Linkages Shahin, M. (1999) ‘Trade and Environment: How Real is the Debate?’, in G. Sampson and W.B. Chambers (eds), Trade, Environment, and the Millennium. New York: United Nations University Press. UNCTAD (1995) Effects of Environmental Policies, Standards and Regulations on Market Access and Competitiveness, with Special Reference to Developing Countries, including the Least Developed among them, and in the light of UNCTAD Empirical Studies: Environmental Policies, Trade and Competitiveness: Conceptual and Empirical Issues, 28 March (TD/B/WG.6/6), paras 103–5. Cited in Brack (1996).

7 Red–Green and Beyond: The German Green Party after the 2002 Elections Ingolfur Blühdorn

Introduction What is the place and what the role of green parties in European polities? Green parties across Europe have – wherever political opportunity structures allowed them to – long shed their stance of radical opposition and their anti-party identity. They have positioned themselves within rather than beyond left and right, formed strategic alliances with other parties, and in some countries (Finland 1995, Italy 1996, France 1997, Germany 1998, Belgium 1999) even entered government coalitions. As green parties have unambiguously anchored themselves on the political left, these coalitions have tended to be left-of-centre alliances with socialist or socialdemocratic parties. However, since the mid-1990s, the topography of the political landscape has changed considerably. The categories of right and left are rapidly losing their capacity of providing political orientation and structuring party systems. First, political actors gravitated towards the deideologized centre, and then new polarizations began to emerge which do not follow the traditional patterns. Public debate and political agendas have focused on issues which have so far not figured prominently on green lists of priorities and competence. For green parties this restructuring of the political landscape implies the need for radical reorientation and repositioning. Ever since they first engaged in electoral competition and coalition politics, the goal of parliamentary survival and the maximization of electoral capital has been a goal no less important than the implementation of green values and policy preferences. As regards these programmatic agendas, green parties have to confront a situation where their original thematic centre, environmental politics, is no longer a marginalized issue, but one that is fully institutionalized and increasingly integrated into all policy areas. 149

150 Red–Green and Beyond

Obviously, ecological modernization is an ongoing process, but the reformulation of environmental problems as managerial and efficiency problems, the implementation of market-oriented policy instruments and the formation of new strategic actor alliances all seem to suggest that liberal democratic systems have, in principle, successfully absorbed the environmental issue. This has triggered debates about a potential ‘end of environmentalism’ (Wissenburg and Levy, 2004) after which green parties may become irrelevant unless they radically reinvent themselves, redefining their role in contemporary politics, their relationship towards the other parties, their programmatic orientation, their constituency, and so forth. In many polities (for example Italy, France, The Netherlands) where green parties had firmly established themselves, they have recently suffered electoral decline (Mair, 2001). The German green party, Bündnis 90/Die Grünen (Alliance 90/The Greens), which has often been described as the most powerful and most successful member of the green party family, has also been going through a phase of deep crisis. In the federal elections of September 2002, however, the German Greens achieved their best result ever at the polls. They were reconfirmed as a party in government, and they were also reconfirmed as the junior partner of Chancellor Gerhard Schröder’s social-democratic SPD. Six months after the elections, their situation seemed even more favourable. While support for their senior coalition partner had slumped in an unprecedented manner, ratings for the Greens had remained stable and actually continued to rise. These remarkable achievements might signal that the party has finally overcome its crisis. The question to be explored in this article is therefore whether the German Greens have at least partially completed the process of their reinvention and repositioning and may serve as a model for other green parties to emulate. Of course, ‘there are more differences than similarities in the development of Green parties’ across Europe (Müller-Rommel, 2002, p. 5). Political systems, party spectrums and culturally ingrained value orientations vary considerably across different European polities. For this reason, the experience and strategies of the German Greens cannot simply be reproduced in other European polities. Nevertheless, the challenge of programmatic redefinition and strategic repositioning is common to many green parties, and, to some extent, the parameters determining this process are actually independent of country-specific constellations. For this reason the analysis of the German Greens may indeed reveal something about the role and shape of green parties in a wider sense. The first half of this chapter examines the anatomy of the German

Ingolfur Blühdorn 151

Greens’ crisis prior to the 2002 elections. The second half is devoted to analysing their performance in these elections and their situation thereafter.

The anatomy of the Greens’ crisis The crisis that affected the German Greens during their first term in office found its most visible expression in a series of electoral defeats that had actually started even prior to the federal elections of October 1998. It gained momentum with the elections in the state of Hesse in February 1999 and the European elections four month later (see Figure 7.1). As the legislature went on it turned into an increasingly life-threatening crisis. Opinion polls never suggested that the Greens would, in national elections, fall below the 5 per cent threshold. However, for a party in government this can hardly be the hallmark, and as regards their performance in office, there was mounting evidence that the Greens were ‘blockading themselves’ and simply ‘not up to the job of governing’ (Raschke, 2001a,b). Even though their internal factional tensions had been pacified, and ideological discrepancies between the coalition parties had become marginal (Lees, 1999), the Red–Green government swiftly ruined its credentials (Klein, 1999; Roth, 1999). After their first year in office Red–Green seemed set to remain a brief episode in German politics (Probst, 1999). As the legislature came to a close there was still only scattered evidence that Germany might be moving towards a greener future (Rüdig, 2002), and it seemed rather uncertain whether there would be much of a future for the Greens (Blühdorn, 2002a).

Permanent crisis Of course, there is something like a permanent crisis which has accompanied the Greens ever since their foundation. It was not only after they had adopted their new role as governing party that the Greens were ‘on the edge of the cliff’ (Raschke, 2001a, pp. 15f.). As a multifacetted minority party, they were a product of the 5 per cent hurdle (Murphy and Roth, 1987) that bars marginal electoral movements from entering the German Bundestag, and they have always been threatened and disciplined by that threshold. This has nurtured a continuous debate about the fragility of the Greens and a steady stream of prophecies of their decline (Dräger and Hülsberg, 1986; Kleinert, 1992; Raschke, 1993a, 2001a,b; Bramwell, 1994; Blühdorn, 2002a). Over the years the structure of this crisis has changed, but whenever it seemed that the party had firmly established itself, new clouds appeared on the horizon.


In the past, the Greens’ problems have been attributed to factors like the inefficient organizational structures of the party, their ideological fragmentation, their internal tensions between fundamentalists and pragmatists, their lack of political experience and professionalism, deficits in terms of media management, their lack of competence in areas other than environmental policy, or their preference for policy obstruction rather than constructive co-operation (Murphy and Roth, 1987; Frankland and Schoonmaker, 1992; Kleinert, 1992; Poguntke, 1993; Raschke, 1993b; Wiesenthal, 1993; Scharf, 1994, 1995). More recently, analysts have highlighted the lack of leadership and a strategic centre, ideological blockages arising from discrepancies between the party’s more radical grassroots and the parliamentary faction in Berlin, the dominant position of the Green figurehead and foreign minister Joschka Fischer, and the way in which Chancellor Schröder has managed to sideline the smaller coalition partner (Lees, 1999; Raschke, 2001a,b). Undoubtedly, these explanations have some merit. But they are insufficient in that they seem to imply that minor and short-term finetuning in the party’s structures and procedures could solve the problem. This does not seem to be the case: in recent years, Bündnis 90/ Die Grünen has addressed its structural problems, trying to strike a balance between strategic efficiency and grass-roots democracy. It has made major efforts to overcome its traditional factionalism and infighting. It has managed to establish an, albeit small, party elite comprising a number of popular and competent front people. During its first term in office, it has constructively cooperated – or even taken the lead – in government policy-making. Also, it has made significant progress in terms of media visibility and professionalism. The image of the anarchic and disorganized green chaos party definitely belongs to the past. Major concerns about Green unreliability and instability are no longer justified. Nevertheless, throughout their first term in office, the Greens never really managed to make use of their prominent position and increased visibility as a party in government in order to raise their public political profile. Although there was a total of 15 electoral contests to be fought (including the European elections of 1999), their elevated status never translated into electoral gains. This suggests that the Greens were hampered by structural factors beyond their control. The verdict that ‘there exists no structurally anchored long-term negative trend’, and that ‘no structural excuses’ for the long-lasting electoral crisis of the Greens ‘are acceptable’ appears questionable (Raschke, 2001a, p. 312). For a fuller understanding of the Greens’ situation at least two structurally anchored factors ought to be taken into account which are widely neglected. First,


when the German Greens obtained government involvement, political expectations placed on the party were extremely high while the external conditions for fulfilling them were extremely unfavourable. Second, when after twenty years of campaigning the Greens finally crossed the ‘threshold of relevance’ (Müller-Rommel, 2002, pp. 3–6), key constituents of their political ideology had become historically irrelevant.

Political expectations and potentials for disappointment When in 1998 the Greens were voted into office there were huge expectations about fundamental policy changes (Roth, 1999). The 1998 elections seemed to inaugurate an entirely new era in German post-war history not only because, for the first time ever, a German government – the Kohl government – was actually voted out of office, but also because the Kohl era that had lasted sixteen long years seemed like a political eternity. Automatically, its defeat raised the impression of a new political dawn, and this was all the more so because it was an entirely new generation that now came to power. This was not only the first genuine post-war generation of politicians, but in addition it was the generation that had triggered the cultural revolution of the late 1960s, and that had now completed what the student leader Rudi Dutschke had once called the long march through the institutions. These factors alone raised huge expectations of change even before any specific policies had been formulated. By putting the abstract idea of change at the centre of their election campaign, the SPD and the Greens themselves had increased these unspecific expectations even further. On election day, both the Social Democrats and the Greens were taken by surprise. Neither of them had genuinely expected that they would succeed in ousting the Conservative government, and in terms of their policy programmes, both of them were poorly prepared. The Greens, who in comparison with 1994 had actually lost votes (from 7.3 per cent to 6.7 per cent), were, furthermore, confronted with the problem that their party had originally been constructed as an anti-party party, that is as a party that had no intention to get involved in a political system which it rejected wholesale (Kelly, 1984). At least the more radical currents within the Greens had always been aware that government involvement could only undermine their credibility and integrity. They had always insisted that their political demands were incompatible with the principles of negotiation and compromise, and that a system that was built upon these principles would necessarily provide unfavourable conditions for the Greens. Over the years, however, the pragmatist wings in the party had gradually become dominant, but they had never


provided comprehensive and consistent evidence that radical reform could really be achieved from within the system. It was only now that the structural tension between continuity at the level of the macrostructures and radical change at the level of concrete practices and policies had to be resolved. To the extent that after 1998 the green clientèle still insisted on radical change, fundamental disappointment with the Greens’ performance in office was therefore structurally predetermined. The chances of the Greens being able to live up to the exaggerated expectations were further diminished by the fact that the German political system is structurally ill-equipped for swift and comprehensive policy changes. Governing parties are not only weakened by the need to compromise with their coalition partners, but processes of reform are slowed down by the frequency of unsynchronised election campaigns in the sixteen federal states, by the requirement to get major pieces of legislation approved by the upper chamber of parliament (Bundesrat), by the constant indirect involvement of the Federal Court of Justice in the legislative process, by the interventions of well-organized and powerful interest groups and, of course, by the influence of supranational institutions like the EU and the CBE. In this structural framework, swift and comprehensive reforms are virtually impossible to achieve. German politics is known for its incrementalism, and against the background of major reform expectations such incrementalism will necessarily lead to disappointment. The difficulties arising from these rather unfavourable conditions were further aggravated by the fact that the first four years of the Red–Green government were dominated by events like the Kosovo war, weapons exports to NATO partner Turkey, and German support for US-led antiterrorist action in Afghanistan. For the Greens in particular, all of these were highly controversial issues because the Kosovo war initiated the redefinition of the Bundeswehr, Turkey had a dubious human rights record and anti-terrorist retaliation against the Taliban regime sat uneasily with the Greens’ pacifist tradition. Given the dominance of external affairs, comprehensive reforms at home were delayed. In eco-political terms, a few reform projects such as the introduction of eco-taxes, the medium-term phasing out of nuclear energy, the support for renewables, or agricultural reforms in the wake of BSE and FMD were launched (Rüdig, 2000, 2002), yet successes were moderate, not least because a comprehensive vision and a convincing strategy were not easily available.

The decline of the traditional Green ideology In the election campaign of 1998, the immediate objective to put an end the Kohl era had taken priority over the objective to define concrete


reform policies which would then be implemented. It was only after the elections that the Greens had to confront the full implications of the fact that the guiding principles for the greening of society have become much less clear-cut and unambiguous than ecologists had originally believed. Indeed, the four ideological pillars – ecology, social justice, grassroots democracy, non-violence – which in their foundation programme of 1980 the German Greens had defined as the core of the party’s political ideology have become rather fragile, as we shall now see. To begin with, the Green principle of non-violence and radical pacifism had its foundation and justification in the power constellation and the arms race logic of the Cold War. After the collapse of the bipolar world order, however, violent conflicts (ethnic, economic, migratory, environmental) emerged in all parts of the world. Militant nationalisms, religious fundamentalisms, the spread of weapons of mass destruction, the unpredictability of regimes in so-called rogue states, as well as the fierce resolve to defend Western privileges and standards of life (Blühdorn, 2004), have rendered the position of radical pacifism inappropriate. Even though the Greens continue to reject the new ideology of pre-emptive military strikes, barbaric campaigns of ethnic cleansing or the terror attacks of suicide bombers imply that the radical stance against any form of military intervention is almost impossible to sustain. The green principle of radical democracy is no longer appropriate because increasingly complex social relations and interest constellations, as well as the increasingly complex problems which have to be dealt with, simply cannot be managed by and at the grassroots of society. The desire for legitimacy has run into conflict with the desire for efficiency. Also, a political culture that strongly relies on political marketing through the mass media and on populist mobilization strategies is not conducive to the kind of deliberative democracy and rational debate that green activists had once envisaged. Anyway, green activists of the early phase had hugely overestimated the extent to which individuals would be prepared to contribute to and participate in the project of societal reform. Of course, better services and more citizen-oriented policymaking are always in demand. Yet the electorate prefers the role of the critical politics and policy consumer and regards political parties as politservice providers (Wiesendahl, 2001). The principle of egalitarianism and social justice, which the Greens had adopted from the socialist tradition and reformulated in eco-political terms, has been undermined by societal differentiation and value pluralism. This principle is challenged by the neomaterialism and egocentrism which thrive in the culture of globalization and its political


economy of uncertainty (Bauman, 1999). The Green assumption that individuals act in a socially oriented and responsible way has given way to the opposite assumption that individuals are first and foremost egoistically minded and attempt to get a free ride. A culture of distrust and social envy undermines the Green principle of inclusionality (Blühdorn, 2003a,b). The redefinition of equality in terms of equality of opportunity rather than equality of outcome presents a major challenge to established Green beliefs. The most important pillar of the Green identity, finally, that is their concern for the natural environment, has been weakened not only because earlier warnings about the imminent collapse of the ecosystem have turned out to be unfounded or at least exaggerated (for example Beckerman, 1995; Lomborg, 2001), but also because certain environmental improvements have actually been achieved, and life with modern high-tech facilities is not anything as terrifying and alienating as environmentalists had once predicted. The post-ecologist frame of mind has transformed perceptions of environmental problems and eco-political imperatives (Blühdorn, 2000, 2002b, 2004). Also, against the background of more urgent problems such as high unemployment, sluggish economic growth, suffocating public deficits and so forth, environmental concerns have become a second-order priority. As some of the specifically green beliefs have thus become historically outdated, and others have been integrated into the programmes of the traditional political parties, it is no longer clear what exactly the Greens stand for and how they distinguish themselves from their political competitors. Of course, the development and maintenance of peace, the process of further democratization, the achievement of national and international social justice, and the implementation of ecological sustainability remain important goals. But these goals no longer add up to a specifically Green ideology and identity. The ecologist demand for ‘new politics’ and a radically different society has turned into the post-ecologist recognition (Blühdorn, 2000) that – be it in structural or in ideological terms – there is no real reason why one should desire anything radically different from what has already been achieved. In a way, the German Greens had thus fulfilled their mission, and the lack of a convincing project or vision gave rise to their electoral crisis.

Electoral crisis Neither the Social Democrats nor the Greens had been voted into office on a ticket of programmatic strength and political competence. For the SPD the crucial factor had been Schröder’s media management and his


personal charisma; for the Greens it was primarily that the Social Democrats needed a coalition partner in order to achieve a parliamentary majority. From the outset, the Red–Green coalition government lacked a political project or a clear vision of where they wanted to go. In contemporary European societies, comprehensive political ideologies may no longer be required, but in order to mobilize the electorate and generate the feeling of progress and achievement, some kind of project is still indispensable. In this sense, Willy Brandt is remembered for democratic renewal (Mehr Demokratie wagen!) and rapprochement with Germany’s neighbours to the east (Ostpolitik). Helmut Schmidt is connected to the exemplary synthesis between the economic and the welfare systems (Modell Deutschland) and Helmut Kohl is the chancellor of German unification and European integration. For Schröder and Fischer, however, no such project was in sight. Comprehensive economic and social reforms were desperately needed, but while the Green figurehead, Fischer, withdrew into the foreign office, Schröder pursued a neo-corporatist politics of consensus and reassurance. From the outset, the government failed to provide the kind of leadership and guidance that was urgently required. The Greens’ series of electoral defeats had started with the four state elections held between March and September 1998. In the federal elections that followed in October they polled 0.6 per cent less than in 1994. This put them in a rather weak starting position as the junior partner in the new coalition government. Already in the elections in Hesse (February 1999) the Red–Green government was for the first time ‘voted out’, not just in the sense that the Red–Green state government of Hesse was replaced by a Conservative one, but also in the sense that the Red–Green coalition in Berlin thus lost their slim majority in the upper house of parliament, the Bundesrat. In the European elections in June 1999 the German Greens then plummeted from 10.1 per cent in 1994 to 6.4 per cent. They did not even manage to mobilize half as many voters as five years earlier. The drop of the general turnout rate by 14.8 per cent was a clear signal of public dissatisfaction with the new government’s performance. The electoral crisis of the Greens then continued until October 2002, with the party often losing more than a third of their previous votes. (See Table 7.1.) While the main explanation for this poor electoral performance of the Greens is surely to be found in the problems discussed above, factors like the increasing normalization of the Green Party, which reduces its capacity to mobilize its constituencies, will also have played a part. The Greens used to rely on young voters, in particular. However, in recent years their appeal to first- and second-time voters has decreased

158 Red–Green and Beyond Table 7.1 2002

Bündnis 90/Die Grünen in state elections, January 1998 to October

Date

Result

Compared with previous

Lower Saxony Saxony-Anhalt Bavaria Mecklenburg-West Pomerania

3/98 4/98 9/98 9/98

7.0% 3.2% 5.7% 2.7%

−0.4% −3.6% −0.4% −1.0%

Hesse Bremen Brandenburg Saarland Saxony Thuringia Berlin

2/99 6/99 9/99 9/99 9/99 9/99 10/99

7.2% 8.9% 1.9% 3.2% 2.6% 1.9% 9.9%

−4.0% −4.2% −1.0% −2.3% −1.5% −2.6% −3.3%

Schleswig-Holstein North Rhine-Westphalia

2/00 5/00

6.2% 7.1%

−1.9% −2.9%

Baden-Württemberg Rhineland-Palatinate Hamburg Berlin

3/01 3/01 9/01 10/01

7.7% 5.2% 8.6% 9.1%

−4.4% −1.7% −5.3% −0.8%

Saxony-Anhalt Mecklenburg-West Pomerania

4/02 10/02

2.1% 2.6%

−1.1% −0.1%

Source: Federal Office of Statistics.

substantially. Closely connected to this is a shift of former green voters towards the Social-Democratic Party, which is facilitated by growing programmatic overlaps between the Greens and the SPD (Lees, 1999). Finally, the more radical parts of the green clientèle, in particular, were disappointed with the relatively weak political performance of the Greens at state level. Significant proportions of those with a strong eco-political commitment therefore resorted to non-voting (Raschke, 2001a, pp. 305f.). What this analysis reveals is that there are indeed structural causes of the Greens’ crisis. The problem of the party is not simply that they are, as Raschke (2001b) put it, ‘strategically incapable’ and therefore ‘not up to the job of governing’. Of course, in media-oriented societies the strategic management of information and presentation is a key constituent of political success. But there is still more to politics than clever media


management; and to exactly this extent it is simplistic to insist that ‘nothing is predetermined’ and ‘everything depends on strategic behaviour’ (Raschke, 2001a, p. 312). The Greens were confronted with a deeply rooted identity crisis, which cannot be remedied with a few superficial measures of political fine-tuning. Yet, the diagnosis of such a structurally anchored crisis renders the Greens’ outstanding performance in the federal elections of September 2002 all the more remarkable.

Explaining the unexpected victory 2002 had widely been regarded as ‘the fateful year’ when ‘the future of the Greens is decided’ (Raschke, 2001a, p. 303). On 22 September, however, the Greens impressively demonstrated that they are still a political force to be reckoned with. After their comeback to the Bundestag in 1994, the federal elections of 2002 represented the second major revival of Bündnis 90/Die Grünen. After a highly professional and wellmanaged campaign, they achieved their best election result ever, polling a completely unexpected 8.6 per cent. For the first time ever, a Green candidate, Christian Ströbele, gained a direct mandate for the Bundestag, capturing the constituency of Berlin-Kreuzberg. The Greens increased the number of their parliamentary representatives from 47 to 55 (out of 603). And as the Social Democrats actually lost votes (down to 38.5 per cent from 40.9 per cent in 1998) the relative weight of their junior partner increased quite considerably. In analysing the 2002 results, it needs to be kept in mind that in media driven excitement democracies, political moods may change very quickly and election results may express momentary and volatile conditions rather than consolidated and stable convictions. In the absence of major ideological differences between the main parties and of clear-cut programmatic profiles, coincidental constellations of short-term factors are significant. The choice of the right election date is at least as important as the politics throughout the legislature. In Germany, it was indeed only in September 2002, that is in the last three weeks before the elections, that the political mood suddenly changed and all predictions by opinion pollsters and party researchers were proved wrong. In comparison with the 1998 federal elections the Greens secured an additional 808 731 votes, and they managed to mobilize 2 368 841 more supporters than in the European elections of 1999 (see Figure 7.1). Interestingly, they improved their 1998 results in every single one of Germany’s sixteen federal states; and in each case they also improved

160 Red–Green and Beyond 4.5

4.1

4

3.6

3.5

3.4

3.3

3 2.5 2

1.7

1.5 1 0.5

Figure 7.1

uro pe an ele ctio 20 ns 02 fed era le lec tio ns

19 99 E

19 98 f

ed era l

ele ctio ns

tio ns ele c

ed era l

19 94 f

19 94 E

uro pe an e

lec tio ns

0

Green votes (in millions) in European and federal elections


on their most recent state election result. This pattern even extended to the five new Länder of the former GDR, where the Greens – following the revolution of 1989 – had gone ‘from vanguard to insignificance’ (Poguntke, 1998). These surprisingly consistent results and their strong contrast with the long-lasting electoral crisis described in the previous section suggest the powerful influence of external factors at the time of the elections. Indeed, the 2002 elections (See Table 7.2) were decided first and foremost by a range of circumstantial factors and coincidental events.

Floods, war and the stock market The first of these to be mentioned was the disastrous floods in East Germany and the Czech Republic. In the middle of August the river Elbe and its tributaries flooded Prague, Dresden, and a whole range of smaller cities and villages. In the worst affected areas of Saxony, the floods destroyed much of what had been achieved in the first twelve years after unification. For the Greens this was a unique opportunity to make the environment a major issue on their campaigning agenda. Somewhat cynically one might describe the Elbe floods as precisely the long-desired

Ingolfur Blühdorn 161 Table 7.2

Bündnis 90/Die Grünen in federal elections

Baden-Württemberg Bavaria Berlin Bremen Hamburg Hesse Lower Saxony North Rhine-Westphalia Rhineland-Palatinate Saarland Schleswig-Holstein

Elections 10/1998 by federal state

Last state election before 9/2002

Elections 9/2002 by federal state

9.2% 5.9% 11.3% 11.3% 10.8% 8.2% 5.9% 6.9% 6.1% 5.5% 6.5%

7.7% 5.7% 9.1% 8.9% 8.6% 7.2% 7.0% 7.1% 5.2% 3.2% 6.2%

11.4% 7.6% 14.6% 15.0% 16.2% 10.7% 7.3% 8.9% 7.9% 7.6% 9.4%

3.6% 2.9%

1.9% 2.7%

4.5% 3.5%

4.4% 3.3% 3.9%

2.6% 2.1% 1.9%

4.6% 3.4% 4.3%

Brandenburg Mecklenburg-West Pomerania Saxony Saxony-Anhalt Thuringia Source: Federal Office of Statistics.

large-scale environmental catastrophe which frustrated environmentalists have always regarded as the only way in which a ‘deeper sense of crisis’ (Rucht and Roose, 1999) can be generated and saturated consumer societies catapulted into effective ecological action. Overnight, the environment, particularly the implications of climatic change, became a major topic which provided the Greens with an opportunity to contrast their own political strengths with the obvious weaknesses in the Conservatives’ so-called ‘team of competence’. The UN summit in Johannesburg (26 August to 4 September) conveniently helped to keep the environmental issue at the top of the agenda. This summit was widely dubbed a ‘talking shop’ with few tangible results. It thus reinforced the message that strong eco-political actors are urgently required. The second major factor was George W. Bush’s politics in the Middle East. His rhetoric of the ‘axis of evil’ and particularly his change of tack, from the original agenda of bringing UN arms inspectors back into Iraq in order to investigate potential production sites for weapons of mass


destruction to the new agenda of toppling Saddam Hussein and forcing regime change, provided Schröder and his Green foreign minister Fischer with an opportunity to capitalize on public concerns about America’s new ideology of preventive military action and its neo-imperialist claim to hegemonic control of global politics. Since the time of Willy Brandt’s Ostpolitik, German election campaigns had never been dominated by foreign affairs. But in 2002, Bush’s belligerence not only deflected attention from the disastrous economic and employment situation in Germany but allowed Fischer, in particular, to pitch his emphasis on diplomatic efforts and political solutions against the much more US-oriented approaches of the opposition parties. Schröder’s ambiguous formula of a ‘German Way’ (mid-August) and his unambiguous rejection of any German involvement in a potential American war against Iraq was a gamble that caused a rift in German–American relations. But at the time of the elections Bush’s politics provided a unique opportunity to tap the strongly anti-militaristic sentiments of the German public. In the same way that the floods in the east and the Johannesburg summit revitalized the environmental issue, the prospect of a military intervention in Iraq revitalized the remains of the peace movement. A third factor that clearly influenced the public mood prior to the September elections was the stock market crisis, the collapse of the ‘new economy’ and the series of accounting scandals in the wake of the ENRON affair. Millions of small investors who had put their money, for example, into Deutsche Telekom saw the value of their shares dwindle and perceived the global economy as a new risk rather than a new opportunity. Public confidence in the democratization of globalization gains was severely undermined. For the Greens this provided an opportunity to tap public sentiments against the globalization of American capitalism (Der Spiegel 34/2002). These concerns complemented the environmental anti-Americanism triggered by Kyoto and Johannesburg, and the pacifist anti-Americanism triggered by Bush’s Middle East politics. They recognized a third dimension of traditional Green politics: anti-capitalist sentiments.

Political suicides An equally coincidental and decisive factor was, furthermore, the unique series of acts of political self-decapitation in the post-socialist PDS, the liberal FDP and the social-democratic SPD immediately before the election date. For Bündnis 90/Die Grünen, all three of these parties are rivals in the sense that in order to get beyond their loyal core constituency of around 6 per cent of the electorate the Greens depend on


different categories of flexible voters who might alternatively vote for the FDP, SPD or PDS. The PDS was a competitor for the Greens, particularly in the east and with regard to left-wing voters who are disappointed with the Greens’ shift towards the social-democratic centre. In early August, the front figure and former chairman of the PDS, Gregor Gysi, unexpectedly resigned from his post as economic secretary in Klaus Woverreit’s Red–Red government of the state of Berlin. Gysi was accused of having used business bonus air-miles for private flights, and there was a sense that he used the ensuing affair as a not entirely unwelcome opportunity to get out of his difficult job in the cash-strapped government of Berlin. This discredited the most popular and mobilizing figure of the PDS and did major damage to the party as a whole. In the elections, the PDS went down from 5.1 per cent in 1998 to 4.0 per cent, that is below the threshold of Bundestag representation. Owing to its more radical anti-war campaign, the PDS still managed to take some 10 000 votes from the left margins of the Greens. Yet, had it not been for the Gysi affair, the pool of disappointed Green voters defecting to the PDS might have been significantly larger. As regards the FDP, the party competed with the Greens particularly for young voters who are increasingly fun-, entertainment- and successoriented rather than social-movement-bred and committed to sociopolitical agendas. Jürgen Möllemann, the chairman of the North Rhine–Westphalian FDP, triggered a major crisis that plunged the party into chaos. Without the official consent of his party, Möllemann had embarked on a crusade for populist votes from the right-wing margins. Repeatedly he had made ambiguous comments about Ariel Sharon’s politics in Palestine and the Jewish television presenter Michel Friedman, who is also vice-president of the Central Council of Jews in Germany. Möllemann’s comments had caused a deep rift in his party because they were incompatible with the liberal tradition of the FDP. Only five days before the elections Möllemann then released a flyer that, once again, consciously tapped and thus legitimated anti-Semitic sentiments in the German public. The flyer, secretly prepared and financed from dubious sources, dealt a disastrous blow to the Liberal Democrats for whom Möllemann himself had set the overly ambitious goal of 18 per cent. In the elections the Liberals achieved a mere 7.4 per cent, thus remaining well behind the Greens who gained about 50 000 liberal votes from them. In comparison to 1998, the FDP still managed to improve their result, yet without the Möllemann affair they would probably have overtaken the Greens and recaptured their old position as the third force in the German party system.


As for the Social Democrats, finally, the Greens compete with them especially for votes from the ecologically oriented and market-critical left. Particularly since Gerhard Schröder’s original finance minister, the ecologically committed and neo-Keynesian Oskar Lafontaine, has left the Berlin stage, there is a considerable potential for the Greens among well-educated left-wing SPD voters. Furthermore, those parts of the electorate which favoured the continuation of the Red–Green coalition government rather than, for example, a potential social democraticliberal coalition, could express their views by voting Green. Indeed, the Greens’ election campaign was strongly based on recruiting borrowed votes of this kind. In this situation, the remarks of Schröder’s justice minister, Herta Däubler-Gmelin, about George W. Bush’s Iraq politics were water on the electoral mills of the Greens. Only two days before the elections Däubler-Gmelin was reported to have described George W. Bush’s foreign policy as an attempt to deflect attention from domestic problems. Allegedly, Däubler-Gmelin had described this as a well-known strategy that had been used by many leaders before Bush, including Adolf Hitler. This remark cost the justice minister her job and the Social Democrats votes in the region of one to two percentage points. The Greens, however, benefited: not least because of the Däubler-Gmelin effect, they secured about 500 000 votes from traditional SPD supporters.

Strategic professionalization Despite the undeniable and decisive impact of these coincidental factors it would, however, be fundamentally wrong to describe the Green victory entirely as the result of external conditions. In a number of respects the Greens’ had, undoubtedly, demonstrated political skills and strategic behaviour. At least to some extent, the outstanding election results of the Greens must therefore be regarded as a fruit of their own efforts and skills. The establishment of the new institution of a party council (Parteirat), for example, and the election of two party chairs replacing the old ‘co-speakers’, contributed to the professionalization of the Greens’ organizational structures. In terms of party organization, this brought them closer to the traditional parties and gave them a strategic centre. From June 2000, Fritz Kuhn and Renate Künast had provided competent and efficient leadership and external party presentation. From March 2001, Claudia Roth had replaced Künast, who became head of the new Ministry for Consumer Protection, Food and Agriculture. The fact that the Greens held not only the Environmental Ministry but also the Foreign Ministry and the modern post-BSE and post-Footand-Mouth Ministry of Consumer Protection, provided them with an


opportunity to demonstrate competence well beyond their traditional core business. Furthermore, taking account of the increasing personalization of electoral contests through the media, the Greens had, for the first time, fully geared their campaign to their top candidate, Joschka Fischer, who throughout the first Red–Green term in office had consistently fronted the popularity charts of German politicians. In the past, the Greens had always strictly rejected such personalization because they were deeply sceptical of any centralization of power and insisted that the electorate ought to vote for the green programme rather than for personalities. As it turned out, the Greens had actually, in March 2002, adopted a new basic programme (Grün 2020) that represents the first comprehensive attempt to update the party’s foundation programme of 1980. It is a realistic programme for a comprehensive societal modernization, and it provides a platform for long-term cooperation with other reformist parties. Yet, for the electorate such programmatic documents normally have little significance. Fischer and his party therefore preferred to rely on the strategy of personalization, which appeared as the safer option to secure their political survival. Another strategic move by the Greens was their clear commitment to the coalition with the Social Democrats. Although during the coalition’s first term in office, a clearly defined Red–Green project and vision had not really emerged (see above), there were indicators that Red–Green might develop into a longer-term symbiosis and genuine option for the electorate, rather than just a necessity of electoral arithmetic. Social justice and sustainability represented two core values for a joint venture in which the Greens would cover the spectrum of the eco-libertarian intellectual left and the SPD would focus on the more centrist and traditional social democratic clientèle. Chancellor Schröder had been reluctant about committing himself to such a longer-term alliance. For most of the campaign he preferred to keep his options open, and it was only after the self-discreditation of the Liberal Democrats that he firmly committed himself. But for the Greens there was no alternative to the coalition with the SPD, and on election day their strategy of campaigning for the continuation of the Red–Green project proved successful. The fact that a significant proportion of the electorate split their two votes (first vote: local candidate; second vote: federal party) between the two parties provides evidence that Red–Green was indeed regarded as a political project rather than just a mathematical necessity (see Table 7.3). The comparison in the table with previous federal elections reveals how the Greens’ surplus of second votes over first votes has steadily

166

Table 7.3

1994 1998 2002

Vote splitting in federal elections from 1994 to 2002 Turnout

Greens, first votes

Greens, second votes

Difference

SPD, first votes

SPD, second votes

Difference

79.0% 82.2% 79.1%

3 037 902 2 448 162 2 693 794

3 424 315 3 301 624 4 110 355

+386 413 +853 462 +1 416 561

17 966 813 21 535 893 20 059 967

17 140 354 20 181 269 18 488 668

−826 459 −1 354 624 −1 571 299



increased. For the Social Democrats, in contrast, there is a growing shortage of second votes in comparison to first votes. In 2002, the Greens secured 1.4 million more second votes than first votes. The SPD had a very similar shortage of second votes. Given that the electorate essentially had to choose between a Red–Green coalition and a Black–Yellow (Conservative–Liberal) alternative, splitting the votes across the two camps would not have made any strategic sense. The figures therefore indicate that significant parts of the electorate voted explicitly for the combination of Red and Green, supporting an SPD candidate locally and the Greens at federal level.

Conclusion: towards a Green Party research agenda What this analysis of the 2002 elections reveals is that the success of the German Greens was to a large extent due to coincidental external factors. Although organizatory, programmatic and strategic professionalization have undoubtedly had some impact, the outstanding election results cannot be interpreted as reflecting a successful programmatic reorientation and strategic repositioning. In the 2002 elections neither proven performance in office nor programmatic competence were decisive. Just as in 1998, Schröder and Fischer have won on the basis of their personal popularity rather than their government track record. Measured by their political achievements, particularly with regard to economic recovery, unemployment and welfare reform, they ought to have lost. Rational actor models do not provide acceptable explanations for the electorate’s decision. Beyond the issues of Iraq and the floods, the election campaign had centred around high and still increasing unemployment figures, poor economic growth, a high public deficit and inefficient systems of health, education and pensions. There seemed to be a choice between economic recovery through welfare austerity programmes and strengthening the welfare state at the expense of economic recovery. The defence of Germany’s economic position seemed to compete with the defence of Germany’s social equality and integration. In a context where economic strength and leadership had obviously already been lost, voting for the defence of the existing (if unaffordable) welfare system appeared as the safer option. In the short term, it seemed to provide reassurance and fend off the double risk of dismantling the welfare system for the sake of an uncertain economic recovery. After all, neoliberal economies like the US and the UK were also ailing, and they provided clear evidence of the social implications of radical economic reform.


So the German Greens have clearly not yet managed to overcome their crisis, but they have been granted another opportunity to fully develop and establish a new political and programmatic identity. They have to take a stance in, and help to shape, the debate between redistribution, reregulation and social security, on the one hand, and flexibilisation, deregulation and economic recovery, on the other. The similarities between 2002 and 1998 are indeed stunning: the problems that need to be resolved today (unemployment, economy, public debts, welfare reform) are exactly the same as for the first Red–Green government. Once again the two winning parties were taken by surprise and are poorly prepared for their job. Once again public support for the government has crashed shortly after the elections. And just as the Kosovo war confronted the first Red–Green government with almost insurmountable problems, the Iraq war is a major stumbling-block for the government in 2003. In 1999 Roland Roth noted that ‘after one year in office, no federal government has ever received such negative marks from all sides’ (Roth, 1999, p. 10). He was stunned by the ‘the pace and extent of the unprecedented decline of public support for a government that had originally been based on a broad public mood of change’ (ibid.). In its second term in office the government had reached this state as early as November 2002. The state elections in Hesse and Lower Saxony (February 2003) saw the SPD vote tumbling from 33.1 to 29.1 per cent in the former, and by a dramatic 14.5 percentage points in the latter. In Lower Saxony, once successfully led by now Federal Chancellor Schröder, the SPD lost their governing majority. The Greens, on the other hand, achieved electoral gains in both states (see Table 7.4). Economic and fiscal policy does not belong to the Greens’ traditional competence and priorities. For this reason, it is primarily the SPD which has to take the blame for the poor state of the German economy and public finances. The Greens on the other hand still benefit from their anti-war stance and Fischer’s opposition to the hawkish foreign policy of George W. Bush’s government. Yet, their electoral achievements must not be interpreted as a sign of their comprehensive recovery. On the Table 7.4

Green election results in Hesse and Lower Saxony

Hesse Lower Saxony

Federal 1998

State 1998–99

Federal 2002

State 2003

8.8% 5.9%

7.2% (1999) 7.0% (1998)

10.7% 7.3%

10.1% 7.6%



contrary, it is indicative that in Lower Saxony, in particular, they have not been able to benefit more from the radical decline of the SPD. This reconfirms that the Greens have still not yet established a new party profile and programmatic identity. For further research into the Greens’ reorientation and repositioning, the concept of sustainability provides an important cue. A redefined concept of sustainability may allow the Greens to overcome their established image and build a bridge from their old identify to a potentially emerging new one. In Germany the unsustainability of the employment situation, the pension system, the health system, public finances and so on have become glaringly obvious. In the name of more sustainability the Greens have started to suggest reforms that go beyond the policies the Social Democrats dare to impose on their clientèle. In the name of sustainability the Greens have begun to suggest welfare cuts, public spending cuts, labour market flexibilisation and other policies which sometimes resemble neoliberal suggestions. And it is perhaps exactly because their old clientèle, the social movement sector, has largely dissolved, and because the Greens have no established commitments in the sense that the more traditional parties do, that they can devise policy suggestions which are more radical and efficient than those of the more established parties. For the Greens, breaking out of their established ideological corner might also include breaking out of the Social-Democratic embrace. In the German party system coalition governments are the norm. In order to secure their long-term survival, small parties have to make sure they can enter alliances with the bigger parties. But until now a coalition with the SPD has widely been regarded as the only realistic option for the German Greens. If they want to remain the third force in the German party system, they have to be able to do what the Liberal Democrats have always done: be open to more than one side. One of the most interesting questions on the Green Party research agenda will therefore be whether and how the Greens can develop a reformist agenda that merges social democratic and conservative concerns and is, at the same time, still green at heart.

References Bauman, Z. (1999) In Search of Politics. Cambridge: Polity. Beckerman, W. (1995) Small is Stupid. Blowing the Whistle on the Greens. London: Duckworth. Blühdorn, I. (2000) Post-Ecologist Politics. Social Theory and the Abdication of the Ecologist Paradigm. London: Routledge.

170 Red–Green and Beyond Blühdorn, I. (2002a) ‘Green futures? A future for the Greens?’, in Goodbody, Axel (ed.), The Culture of German Environmentalism: Anxieties, Visions, Realities. Oxford: Berghahn, pp. 103–21. Blühdorn, I. (2002b) ‘Unsustainability as a frame of mind – and how we disguise it. The silent counter-revolution and the politics of simulation’, The Trumpeter, 18(1), 59–69. Blühdorn, I. (2003), ‘Inclusionality – Exclusionality. Environmental philosophy and simulative politics’, in A. Winnett (ed.), Towards an Environmental Research Agenda, vol II. Basingstoke: Palgrave, pp. 21–45. Blühdorn, Ingolfur (2004) ‘Post-Ecologism and the Politics of Simulation’, in Wissenburg and Levy, pp. 35–47. Bramwell, A. (1994) The Fading of the Greens. The Decline of Environmental Politics in the West. New Haven, CT: Yale University Press. Dräger, K. and Hülsberg, W. (1986) Aus für Grün? Die grüne Orientierungskrise zwischen Anpassung und Systemopposition. Frankfurt: isp. Frankland, G. and Schoonmaker, D. (1992) Between Protest and power: The Green Party in Germany. Boulder, CO: Westview. Kelly, P. (1984) Fighting for Hope. London: Hogarth Press. Klein, Markus (1999) ‘The Year After. Rot-Grün und die Wahltrends ‘99’, Forschungsjournal Neue Soziale Bewegungen, 12/4, pp. 41–9. Kleinert, H. (1992) Aufstieg und Fall der Grünen. Analyse einer alternativen Partei. Bonn: Dietz. Lees, C. (1999) ‘The Red–Green Coalition’, German Politics, 8(2), 174–94. Lomborg, B. (2001) The Skeptical Environmentalist. Measuring the Real State of the World. Cambridge. University Press. Mair, P. (2001) ‘The green challenge and political competition. How Typical is the German Experience?’ German Politics 10/2, pp. 99–116. Müller-Rommel, F. (2002) ‘The lifespan and political performance of Green Parties in Western Europe’, Environmental Politics, 11/1, pp. 1–15. Murphy, D. and Roth, R. (1987) ‘In viele Richtungen zugleich. Die Grünen – ein Artefakt der Fünf-Prozent-Klausel?’, in: Roth, and Roeald Dieter Rucht (eds.) (1987) Neue Soziale bewegungen in der Bundesreublik Deutschland. Bonn: Bundeszentrale für Politische Bildung, pp. 303–24. Poguntke, T. (1993) Alternative Politics. The German Green Party. Edinburgh University Press. Poguntke, T. (1998) ‘Alliance 90/The Greens in East Germany. From Vanguard to Insignificance’, Party Politics, 4(1), 33–55. Probst, L. (1999) ‘Ist Rot-Grün regierungsfähig? Anmerkungen zu den Perspektiven von SPD und Bündnisgrünen’, Forschungsjournal Neue Soziale Bewegungen, 12(4), 22–31. Raschke, J. (1993a) Die Krise der Grünen. Bilanz und Neubeginn. Marburg: Schüren. Raschke, J. (1993b) Die Grünen. Wie Sie Wurden, Was Sie Sind. Cologne: bund Verlag . Raschke, J. (2001a) Die Zukunft der Grünen. So kann man nicht regieren, Frankfurt: Campus. Raschke, J. (2001b) ‘Sind die Grünen regierungsfähig? Die Selbstblockade einer Regierungspartei’, Aus Politik und Zeitgeschichte B10/2001, pp. 20–8.

Ingolfur Blühdorn 171 Roth, R. and Rucht, D. (eds) (1987) Neue Soziale Bewegungen in der Bundesrepublik Deutschland. Bonn: Bundeszentrale für Politische Bildung. Roth, R. (1999) ‘Ein Jahr Rot-Grün. Ein politischer GAU für die neuen sozialen Bewegungen?’, in: Forschungsjournal Neue Soziale Bewegungen 12/4, pp. 10–21. Rucht, D. and Roose, J. (1999), ‘The German environmental movement at a crossroads’, in Rootes, pp. 59–80. Rüdig, W. (2000) ‘Phasing out Nuclear Energy in Germany’, German Politics, 9(3), 43–80. Rüdig, W. (2002) ‘Green Parties in national government: Germany’, Environmental Politics 11:1, 78–111. Scharf, T. (1994) The German Greens: Challenging the Consensus. Oxford: Berg. Scharf, T. (1995) ‘The German Greens: a political profile’, in Blühdorn et al. pp. 131–42. Wiesendahl, E. (2001) ‘Keine Lust mehr auf Parteien. Zur Abwendung Jugendlicher von den Parteien’, Aus Politik und Zeitgeschichte, B10/2001, 7–19. Wiesenthal, H. (1993) realism in Green Politics. Social Movements and Ecological Reform in Germany. Manchester University Press. Wissenburg, M. and Levy, Y. (eds) (2004) Liberal Democracy and the Environment. The End of Environmentalism?, London/New York: Routledge.


Part IV Technology, Engineering and the Environment


8 Engineering Sustainability: Thermodynamics, Energy Systems and the Environment Geoffrey P. Hammond

Summary Thermodynamic concepts have been utilized by practitioners in a variety of disciplines with interests in environmental sustainability, including ecology, economics and engineering. Widespread concern about resource depletion and environmental degradation are common to them all. It has been argued that these consequences of human development are reflected in thermodynamic ideas and methods of analysis; they are said to mirror energy transformations within society. The concept of ‘exergy’, which follows from the second law of thermodynamics, is viewed as providing the basis of a tool for resource and/or emissions accounting. It is also seen as indicating natural limits on the attainment of sustainability. The more traditional use of the exergy method is illustrated by a number of cases drawn from the United Kingdom energy sector: electricity generation, combined heat and power schemes, and energy productivity in industry. This indicates the scope for increasing energy efficiency, and the extent of exergetic ‘improvement potential’, in each of these areas. Poor thermodynamic performance is principally the result of exergy losses in combustion and heat transfer processes. However, the application of such thermodynamic ideas outside the sphere of engineering is not without its critics. The link between the efficiency of resource utilization, pollutant emissions and ‘exergy consumption’ is real, but not direct. Methods of energy and exergy analysis are therefore employed to critically evaluate thermodynamic concepts as measures of sustainability. 175

176 Engineering Sustainability

Introduction Background Energy sources of various kinds heat and power human development, but Hammond (2000b) has noted that they also put at risk the quality and longer-term viability of the biosphere as a result of unwanted or ‘second-order’ effects. Many of these side-effects of energy production and consumption give rise to resource uncertainties and potential environmental hazards on a local, regional and global scale. Examples include the depletion of North Sea oil and natural gas resources, the generation of smog from urban road transport, the formation of acid rain via pollutant emissions, primarily from fossil fuel power stations, the difficulty of long-term safe storage of radioactive wastes from nuclear power plants, and the possibility of the enhanced greenhouse effect from combustiongenerated pollutants. Consequently, the energy sector plays a pivotal role in attempts to achieve sustainable development, balancing economic and social development with environmental protection (‘people, planet, prosperity’ in terms of the strapline adopted by the UK Sustainable Development Commission). National governments, as well as regional bodies in the West (such as the European Union and the International Energy Agency), therefore need to assess the long-term advantages and disadvantages of their available energy sources in order to reconcile the pressures induced by the move towards competitive markets with the requirements of a sustainable energy strategy. Although it would be desirable on natural resource and environmental grounds to phase out the use of fossil fuels, this may not be feasible until perhaps the middle of the twenty-first century.

The issues considered The present paper employs thermodynamic methods of analysis to critically evaluate the sustainability of energy systems and components. Parkin (2000) has argued, influenced by the earlier work of Mueller (1971), that such ideas also underlie the understanding of sustainable development more broadly. She interprets the second law of thermodynamics in terms of the tendency of everything to return to an elemental state. Natural cycles are seen as combating this energy degradation as well as environmental pollution. The link between the efficiency of resource utilization, pollutant emissions, and ‘exergy consumption’ is real, but not direct. Different resource implications, for example, follow from fossil fuel use as against the adoption of, typically, solar-derived, renewable energy sources (as highlighted recently by Hammond and

Geoffrey P. Hammond 177

Ecology and thermodynamics

Economics and technology

Society

Area of sustainability Figure 8.1

Sustainability Venn diagram for engineers

Source: adapted from Parkin, 2000.

Stapleton, 2001). The former is a ‘capital’ resource that depletes over time, whereas renewables may be viewed as energy ‘income’ to the planet. This is not explicitly reflected in thermodynamic analysis, where the resource bases are taken as essentially equivalent. Engineers and physical scientists therefore have a critical role to play because of their understanding of the scientific processes that underpin the natural world. The interconnections between engineering constraints and the economic and social domain are illustrated by the sustainability Venn diagram shown as Figure 8.1 (adapted from a version attributed by Sara Parkin (2000) to Professor Roland Clift of the University of Surrey). Here thermodynamic limits are represented as underpinning the environmental sphere. The present assessment therefore aims to provide a practical framework for the use of such thermodynamic ideas and analysis in this wider context of environmental sustainability. The last book by the late Stephen J. Kline (1999), the distinguished Stanford engineering professor and co-founder of the Stanford programme on ‘Values, Technology and Society’ (subsequently renamed ‘Science, Technology and Society’), attempted to provide the new generation of teachers and students of thermodynamics with a better understanding of second-law ideas. In addition, he strove to identify misconceptions in the various definitions of thermodynamic properties, such as entropy, used in engineering, physics, informatics and biology. Hammond (2003) recently argued that Kline’s work had been rather overlooked, and that it deserved much wider recognition among the


thermodynamics community. It suggests that thermodynamic ideas (with their empirical foundations derived from the work of Carnot, Kelvin and Clausius related to ‘heat engines’) may not be appropriately applied to other domains outside the area of energy systems for which they were first devised. Attempts to use them to determine criteria for long-term sustainability (see, for example, Mueller, 1971; Parkin, 2000 and Porritt, 2000) can therefore be misleading. This paper attempts to illustrate when thermodynamic concepts and methods of analysis can directly aid an understanding of sustainable development in contrast to those occasions when their use is merely analogous or metaphorical.

Sustainable development and the energy sector Sustainable development or sustainability Over a period of some fifteen to twenty years, the international community has been grappling with the task of defining the concept of ‘sustainable development’. It came to prominence as a result of the Brundtland Report produced by the World Commission on Environment and Development (WCED, 1987) under the leadership of the former prime minister of Norway, Gro Harlem Brundtland. This commission argued that the time had come to couple economy and ecology, so that the wider community would take responsibility for both the causes and consequences of environmental damage. The WCED (1987) defined sustainable development as meeting ‘the needs of the present without compromising the ability of future generations to meet their own needs’. It therefore involves a strong element of intergenerational ethics. Engineers have generally been slow to meet the challenge of making a reality of the notion of sustainability (Hammond, 2000b), although the engineering profession now sees the importance of using their skills to improve the quality of life. Many writers and researchers have acknowledged that the concept of ‘sustainable development’ is not one that can be readily grasped by the wider public. However, no suitable alternative has currently been found (Hammond, 2000b). The sustainable development paradigm has had its critics over recent years (see Doughty and Hammond, 2003). Meredith Thring (private communication, 1999) regards the term as an oxymoron, arguing that development per se cannot be sustainable. He would prefer humanity to strive for a creative and stable world with the aid of ‘equilibrium engineering’ (Thring, 1990). Similar views can be found in developing countries, where their debt burden and inequalities in global income distribution


are seen as serious obstacles to sustainable development (Amin, 1997). On a more fundamental level, Jonathan Porritt (2000) has recently stressed that such development is only a process or journey towards a destination, which is ‘sustainability’. This process cannot easily be defined from a scientific perspective, although he argues that the attainment of sustainability can be measured against a set of four ‘system conditions’. Porritt draws these from ‘The Natural Step’, an initiative by the Swedish cancer specialist Karl-Henrick Robèrt:

• Condition 1 – Finite materials (including fossil fuels) should not be extracted at a faster rate than they can be redeposited in the earth’s crust. • Condition 2 – Artificial materials (including plastics) should not be produced at a faster rate than they can be broken down by natural processes. • Condition 3 – The biodiversity of ecosystems should be maintained, while renewable resources should only be consumed at a slower rate than they can be naturally replenished. • Condition 4 – Basic human needs must be met in an equitable and efficient manner. These sustainability conditions put severe constraints on economic development, and they may therefore be viewed as being impractical or ‘utopian’ (Doughty and Hammond, 2003). They certainly imply that the ultimate goal of sustainability is rather a long way off when compared with the present conditions on the planet.

Fossil fuel depletion The combustion of finite reserves of fossil fuels results in their obvious depletion over time (Hammond, 2000b). It is often claimed, particularly by economists, that the resource-carrying capacity of the planet as a whole is so large that new discoveries offset current production. Although this may be true on a global scale, it is unlikely to apply at the level of the individual nation-state, or even at a regional scale (such as within the European Union). There is considerable uncertainty over fossil fuel resources in the medium term. The lifetime and global distribution of these vary enormously:

• Oil – OPEC-(Middle East-)-dominated, 20–40-year life. • Natural gas – CIS-(Russian-)-dominated, 40–70-year life. • Coal – Widely distributed, 80–240-year life.


These figures are rough estimates assuming current rates of consumption (Hammond, 1998), but they indicate that the sources of fossil fuel supplies for OECD countries, with the exception of coal, are rather insecure. If depletion of oil and gas at anything like the rate indicated here actually occurred, then the price of these fuels would rise. The abundance of coal is likely to place an upper limit on all fossil fuel prices at the synthetic fuel cost for the foreseeable future (Hammond, 2000b). Nevertheless, this would make the financial case for renewable energy sources and nuclear power look much brighter. It has been frequently argued since the ‘oil crises’ of the 1970s that a nuclear power and/or renewable energy strategy should be adopted as an ‘insurance policy’ against the insecurity of the oil market. In reality these resources are not substitutable, particularly in the transport sector (Hammond, 1998).

Pollutant emissions and global warming The combustion of fossil fuels results in pollutant emissions that can damage human health and the environment on a number of levels. Most environmental concern has recently focused on global warming (RCEP, 2000): the speculative prospects of global climate change induced by the emission of so-called ‘greenhouse’ gases (GHG), principally CO2 emissions, from fossil fuel combustion is an issue of considerable interest. Obviously the main concern is found in those coastal and island nations at risk of flooding were sea levels to rise as a result of climate change (Hammond, 2000a). The critical issue is whether the observed global warming is due to human activity or simply a natural phenomenon induced, for example, by variations in solar output over decades. The UK Natural Environment Research Council has summarized the current state of the art in climate change research (NERC, 1997). The British government’s former chief scientific adviser, Sir Robert May (1997) (now Lord May of Oxford, president of the Royal Society), has advocated action to reduce carbon dioxide emissions on the basis of the ‘precautionary principle’ (see, for example, Hammond, 2000b or Porritt, 2000); not out of conviction that anthropogenic climate change is currently proven, but because its possible effects over the next century may be damaging and large-scale. Carbon dioxide released into the atmosphere from the burning of fossil fuels is thought to have a ‘residence time’ of around one hundred years (Hammond, 2000a). Recent trends in CO 2 emissions from the UK energy sector are depicted in Figure 8.2 (Hammond, 2000b), along with the anticipated reduction due to measures already included in the

Geoffrey P. Hammond 181 Carbon (Mt) 190 actual

projections

180 UK energy sector CO2 emissions 170 DTI (2000) range

160

1999 data

150

140 DETR (2000) climate change measures 130 1970

1980

1990

2000

2010

2020

year Figure 8.2

Carbon dioxide emissions from the UK energy sector

Source: Hammond, 2000b.

British government’s year 2000 climate change programme. These are likely to ensure that the UK comes close to the domestic goal of a 20 per cent cut in carbon dioxide emissions, below the 1990 levels, by 2010. However, the Royal Commission on Environmental Pollution has argued (RCEP, 2000) that the UK should take the lead in adopting a more ambitious target of reducing these emissions by some 60 per cent from 1997 levels by about 2050. The 2003 energy white paper (DTI, 2003) accepted that Britain should put itself on a path to achieve this goal by adopting various low-carbon options, principally energy efficiency measures and renewable energy sources. New nuclear power plants are regarded by the UK government as uneconomic in the present energy market conditions, and the problem of longer-term radioactive waste storage as being unresolved. However, this option will be kept open in case renewable energy technologies do not fulfil their promise in (say) five to ten years or so.


Sustainable energy systems The intergenerational ethical injunction in the Brundtland report (WCED, 1987), effectively to avoid actions that might degrade the biosphere for future generations, presents special difficulties for the energy sector. It implies that governments should conserve depleting fuel resources, and make greater use of renewable energy sources, in line with the Natural Step system conditions. However, the World Energy Council (WEC, 1993) suggested in 1993 that renewables might contribute between 3 per cent and 12 per cent of total commercial energy demand by 2020. A more recent study (Nakicenovic et al., 1998) by the WEC, jointly with the International Institute of Applied Systems Analysis, has been rather more optimistic about the contribution of renewables after 2020. The greatest potential for renewable energy is likely to be in the second half of the twenty-first century, with the most optimiztic supply projection being 80 per cent of global demand by 2100. In the United Kingdom the government is now committed (DTI, 2003) to developing a sustainable energy economy over the longerterm, and to taking a lead in reducing CO2 emissions among the industrialized (OECD) countries. The main components of this low-carbon strategy are energy conservation and renewable energy systems, with carbon sequestration and nuclear power in a rather more secondary role. Targets for new renewable electricity supply have been set at 10 per cent by 2010 and 20 per cent by 2020 from a present base of only 1.5 per cent. Bridging the renewables gap will be a daunting task. It remains to be seen whether even the government’s 2010 or 2020 targets can be met within a competitive market framework. There appears to be little prospect, for example, of large-scale projects being funded via this route (Hammond, 2000b). Even the proposed 8.6 GW WestonSuper-Mare to Lavernock Point tidal barrage scheme, which could meet some 6 per cent of UK electricity demand (albeit with potential ecological damage to the Severn Estuary) has not attracted serious investors under present market conditions, owing to high capital costs and long construction periods. Nevertheless, the Royal Commission on Environmental Pollution suggested that renewable energy might contribute between 15 per cent and 25 per cent of total energy demand by 2050 (RCEP, 2000). They envisage that some 10–15 per cent of total supply would need to be met by intermittent sources: that is, by onshore and offshore wind turbines, solar photovoltaic (PV) cells, and wave and tidal stream devices, as well as the Severn tidal barrage.


For the RCEP (2000) target contribution from renewables to actually be achieved, a significant reduction in primary energy consumption to between 45 per cent and 75 per cent of the present figure, would be required. This implies the widespread adoption of energy-saving measures across the economy, and this has now been acknowledged in the recent UK energy white paper (DTI, 2003). It is in this area that thermodynamic analysis can make a major contribution to identifying where the improvement potential lies. Indeed Hammond and Stapleton (2001) found, using second-law or ‘exergy’ analysis, that nearly 80 per cent of this potential is associated with electricity generation, together with final energy demand in the domestic sector and in transport. The poor thermodynamic performance in these sectors is due principally to exergetic losses in combustion and heat transfer processes associated with power generation, space heating and the main transport modes. Various policy instruments will inevitably be required to encourage the introduction of energy efficiency measures in the face of market barriers – including building and product efficiency standards, CO2 emissions trading, tax incentives and advice and information (DTI, 2003). The potential importance of the global warming problem in many minds has resulted in the case being made for a ‘low-carbon’ economy, rather than just a ‘low-energy’ one. Technologies for carbon sequestration have therefore been identified as an important element in any energy RD&D programme. Such approaches are certainly consistent with the ‘precautionary principle’ (see, for example, Hammond, 2000b or Porritt, 2000). Japanese industry is well advanced in terms of demonstration plant for CO2 sequestration (Hammond, 2000b), as well as for other pollutants. Integrated coal gasification combined-cycle (IGCC) plants lead to both relatively high thermal efficiencies (greater than 50 per cent) and a reduction of CO2 of better than 20 per cent compared with conventional plant. In the case of clean coal technology, pressurised fluidized-bed boilers yield high combustion efficiencies together with NO x emission control. In the UK, the Natural Resources and Environment Foresight Panel has called for research on a number of key carbon sequestration technologies.

The mathematical and physical framework for thermodynamic analysis Energy analysis In order to determine the primary energy inputs needed to produce a given amount of product or service, it is necessary to trace the flow of


energy through the relevant industrial system. This is based on the first law of thermodynamics – the principle of the conservation of energy, or the notion of an energy balance applied to the system. It involves the entire life-cycle of the product or activity ‘from the cradle to the grave’. The system boundary should strictly encompass the energy resource in the ground (for example, oil in the well or coal at the mine), although this is often taken as the national boundary in practice. Thus, the sum of all the outputs from this system multiplied by their individual energy requirements must be equal to the sum of inputs multiplied by their individual requirement. This process consequently implies the identification of feedback loops, such as the indirect, or ‘embodied’, energy requirements for materials and capital outputs. It is therefore sometimes termed ‘net energy analysis’. Energy conservation suggests that for a steady-state process the first law may be represented by (Hammond and Stapleton, 2001) equation (8.1):

∑ (h + ke + pe)in · min − ∑ (h + ke + pe)out · mout + ∑ Q − W = 0

(8.1)

where min and mout = the mass flow across the system inlet and outlet respectively Q = the heat transfer across the system boundary W = the work (including shaft work, electricity, and so on) transferred out of the system h, ke, pe = the specific values of enthalpy, kinetic energy, and potential energy respectively Equation (8.1) is commonly known as the ‘steady-flow energy equation’, and is represented schematically in Figure 8.3. This energy balance can be simplified, assuming negligibly small changes in kinetic and potential energy and no heat or work transfers, to (Hammond and Stapleton, 2001) equation (8.2):

∑ Hi,in = ∑ Hj,out

(8.2)

where Hi,in = the various energy (or enthalpy) streams flowing into the system Hj,out = the different energy outputs If all these inputs and outputs are taken into account (whether or not all the outputs are actually ‘useful’) then the first-law energy efficiency becomes equation (8.3).


Qe

T0

Wuseful Hin

Control volume

Qother (or Wother)

Qb Figure 8.3

An energy balance for a simple control volume or unit operation

∑ E j ,out Hout- = 1 η = --------------------- = ----------∑ H i, in H i n

(8.3)

This is not a very helpful expression, as many of the energy output streams will be in the form of ‘waste heat’. A more practical definition for the energy efficiency is one along the lines (Hammond, 1998) shown in equation (8.4): Overall energy supplied to final consumers system efficiency = Energy -------------------------------------------------------------------------------------------------- × 100% Primary energy consumed

(8.4)

Here ‘primary energy’ is the energy resource input into the whole system. There are many feedback loops in the energy system whereby primary energy sources (including fossil fuels, uranium ore and hydro-electric sites) and secondary derivatives (such as combustion and nucleargenerated electricity) themselves provide upstream energy inputs into the ‘energy transformation system’. This is that part of the economy where a raw energy resource is converted to useful energy, which can then meet downstream ‘final’ or ‘end-use’ demand (Slesser, 1978). ‘Renewable’ energy sources are taken to mean those that are ultimately solar-derived: mainly solar energy itself, biomass resources and wind power. Thus, energy inputs and outputs to the whole system can be equated via (Hammond, 1998) equation (8.5): Primary energy = Downstream end-use or delivered energy + Upstream waste

(8.5)


The energy efficiency defined in equation (8.4) may be rewritten in terms of the mathematical notation employed here to yield equation (8.6): ( H out ) useful ∑ E j,out

(8.8)

Thus, the exergy loss or irreversibility rate (van Gool, 1992) of the system is given by equation (8.9): I ≡ Δ Elost = Ein − Eout > 0

Ee = 1–

(8.9)

T0 Te

Te

T0

Qe Wuseful

Ein = Hin Control volume

Eb = 1–

Figure 8.4

T0 Tb

I

Qb Tb

An exergy budget for a simple control volume or unit operation


Kline (1999) argues that ‘irreversibility’, perhaps denoted better by the term exergy ‘degradation’ or ‘destruction’ (Hammond, 2003), can be interpreted as the dissipated ‘available energy’ (or exergy) that ends up as random thermal fluctuations of the atoms and molecules in the exit flow of mechanical devices. He illustrates this process by way of examples drawn largely from the sort of rotating fluid machines with which he was most familiar (essentially kinetic energy converters). A slightly different interpretation may be needed to understand exergy dissipation in the course of fossil fuel combustion (Hammond, 2003). Nevertheless, Kline rightly argues that this phenomenon can only be understood as an interaction between processes at both the macroscopic and microscopic scales. The exergy function itself is an ‘extensive’ property (Rosen and Dincer, 1997; Hammond and Stapleton, 2001), which is defined by reference to a ‘dead’ or equilibrium state (in terms of temperature To, pressure Po and species component μio) as shown by equation (8.10): E = (H – Ho) – To(S – So) + ∑ N i ( μ i – μ io )

(8.10)

i

where S denotes entropy and Ni is the number of moles of species i. Variations in species concentration are not usually significant in problems related to the macroscale analysis of energy systems. Consequently, a truncated mathematical expression can be used to calculate ‘physical’ or ‘thermomechanical’ exergy states, as in equation (8.11): E = (H – Ho) – To (S – So)

(8.11)

The choice of the reference state has been the subject of some divergence of opinion in the literature. Rosen and his co-workers (Rosen, 1992; and Rosen and Dincer, 1997) employed standard temperature and pressure (To = 298 K (25 °C) and Po = 1 atm) for his exergy analysis of the Canadian and Turkish economies, whereas Wall (1987 and 1990) adopted 15 °C as the datum for his country studies of Sweden and Japan. Nevertheless, a more common basis for heat load calculations in mainland Britain is to assume a winter outside design temperature of about −1 °C. This was the reference condition recently adopted by Hammond and Stapleton (2001) for their exergy analysis of the UK energy system. It is the same as the ‘dead-state’ temperature adopted by Reistad (1975) for exergy analysis of space heating in the USA.


The exergy method in practice: some useful parameters and tools An exergy efficiency, ψ, can be defined by (Hammond and Stapleton, 2001) equation (8.12): E out I- = 1 – ------ψ = --------- 692 K), and mechanical drives. Typical first- and second-law efficiencies in these categories are illustrated in Figure 8.9. These are end-use values, and obviously the net energy and exergy efficiencies would need to account for losses in power generation. Consequently the use of electricity to power mechanical drives is not as attractive as it appears, but is largely a necessary engineering requirement. A knowledge of fuel and electricity shares in each of the process categories (Hammond and Stapleton, 2001) enables the thermodynamic inputs and outputs associated with the industrial sector to be estimated. The overall industrial sector exergy


efficiency (≈46 per cent in the mid-1990s) is significantly lower than the corresponding energy efficiency (≈69 per cent), although Hammond and Stapleton (2001) observed that the disparity is not as large as in the domestic sector, where space heating requirements predominate. They showed that exergy losses in industry, as a proportion of the energy input, are rather smaller than in either electricity generation or the domestic sector. Nevertheless, there is still considerable scope for thermodynamic improvements in industry. There is obviously a need to stimulate improvements in resource use efficiency generally, and to encourage energy conservation ‘from the bottom up’. Such an approach would need to be coupled with measures to reduce the rate of consumption of fossil fuels, and stimulate an expansion in the use of renewable energy sources (RCEP, 2000). It would involve a consumer-oriented market approach, coupled with intervention by way of a portfolio of measures to counter market deficiencies, also the employment of economic instruments, environmental regulation, and land use planning procedures. Scenarios such as the ‘dematerialization’ or Factor Four project, advocated by Ernst von Weizsäcker and Amory and Hunter Lovins (1997), suggest that economic welfare in the industrial world might be doubled while resource use is halved, hence the ‘Factor Four’. This would involve a structural shift from energy intensive manufacturing to energy frugal services (Hammond, 2000b). Britain has moved some way in this direction, with a 40 per cent improvement in primary energy intensity since 1965. Increases in resource use efficiency to the Factor Four level (and the UK Foresight Programme is contemplating Factor Ten over the long term) would have the enormous knock-on benefit of reducing pollutant emissions that have an impact, actual or potential, on environmental quality. In reality such a strategy requires a major change (‘paradigm shift’) to an energy system that is focused on maximizing the full fuel–energy cycle efficiency, and minimizing the embodied energy in materials and products by way of reuse and recycling (Hammond, 2000b). In order to make such an approach a practicable engineering option, it would be necessary to use systems analysis methods to optimize the energy cascade (Hammond, 2000b; O’Callaghan, 1993). Thermodynamic analysis will be an important technique for identifying process improvement potential. The tools developed by van Gool (1987 and 1992) and his co-workers based on the notion of ‘thermodynamic quality’, equation (8.18), can play a key role here. They employed, as previously noted, enthalpy/quality diagrams to identify the scope for energy (or heat) cascading within the industrial sector of several developed countries.


Thermodynamic ideas and environmental sustainability: multidisciplinary dimensions Thermodynamics, analogy and metaphor Thermodynamic concepts have been drawn upon by practitioners in a variety of disciplines with interests in environmental sustainability, including ecology, economics and engineering. Widespread concern about resource depletion and environmental degradation are common to them all. It has been argued that these consequences of human development are reflected in thermodynamic ideas and methods of analysis (see, for example, the early work of Mueller (1971) at the US Goddard Space Flight Center); they are said to mirror energy transformations within society. Mueller (1971) draws a parallel between the resource flows in economics and energy (as well as implicitly exergy) flows in thermodynamics. This leads him to an analogy, arguably rather dubious, between the ‘technology of man’ and heat engines. Such ideas have inspired the environmental campaigner Sara Parkin (2000) (a co-founder with Jonathan Porritt of the sustainable development charity Forum for the Future) and others to believe that thermodynamic principles or laws may act as a guide for engineers in the quest for environmental sustainability. In the context of ‘The Natural Step’, energy and matter are seen as having a tendency to disperse. Entropy (another second-law extensive property of matter, that is related to exergy via equation (8.10) or (8.11)) is regarded as a measure of this disorder in a closed or isolated system. The earth is such a closed system in terms of matter, but an open one from the perspective of the incoming solar energy that drives living plants via photosynthesis. This underpins the notion of ‘capital’ and ‘income’ energy resources for the planet (such as fossil fuels and solar energy respectively), and is behind the first of the TNS system conditions. Outside the realm of energy systems, thermodynamic concepts are typically employed in terms of an analogy with, or resemblance to, physical processes. Alternatively, their use may be regarded, as colleagues at the University of Bath have suggested (Stephen Gough and William Scott, Centre for Research in Education and the Environment (CREE), private communication, 2003), as metaphorical – being applicable imaginatively but not literally. Entropy is not an easy concept to grasp, particularly when it has been so widely used and abused. It was originally developed by Rudolf Clausius (circa, 1864) from a consideration of the Carnot cycle for an ideal heat engine. This original ‘energetic’ (Clausius) entropy reflects the fact that, although heat can flow down a temperature gradient unaided, shaft


work or an electrical energy input is required in order to induce heat transfer to take place from a cold to a hot reservoir: this is Clausius’s inequality. However, the idea of entropy has fascinated writers in disciplines far removed from engineering and the physical sciences. Many analogous properties have been proposed. Stephen Kline (1999) identifies five microscopic ‘entropies’ (including Gibbs’s statistical entropy), two information functions (Shannon’s and Brillouin’s so-called ‘entropies’), and what he amusingly denotes the ‘vulgar’ entropy. He uses the latter term to describe the generic, but vague or ill-defined, application of entropy to various kinds of disorder. Kline interprets Gibbs’s statistical entropy as a useful measure of the ‘spread-outness’ of random molecular fluctuations among various microstates within the constraints of the physical boundaries of a system. However, he criticizes the attribution of the term ‘entropy’ to information functions as an error of typology, saying it is like equating ‘apples with oranges’. In addition, Kline demonstrates that Brillouin’s ‘entropy’, a probabilistic quantity widely employed in the field of informatics, was built on the foundation of a sign error in a famous 1929 paper by Leo Szilard, another Nobel laureate in physics. These are not unique criticisms, and Kline points to earlier reservations by the likes of Denbigh, Fast, Pierce and Popper.

Environmental economics and the entropy law Perhaps the first discipline outside engineering to seriously adopt thermodynamic ideas was economics – actually the sub-set that has become known as environmental economics. The system studied in economics is the individual firm or the consumer (Hammond, 2000a). Transactions between the firm (or consumer) and the rest of the world are described in terms of the quantities and prices of the commodities exchanged. Prices in this neoclassical economic model are supposed to reflect the ‘value’ that society places on an economic good. Thus, economic practitioners claim that their discipline is ‘normative’: it suggests the optimal course of action to be taken in the allocation of resources, whereas thermodynamic analysis is ‘prescriptive’. However, environmental economists have employed thermodynamic ideas to devise alternative accounts of sustainability by analogy to physical or natural processes, such as energy usage. There is a well-developed literature, dating back to the early 1970s, that amounts to the postulation of an ‘energy theory of value’ (Söllner, 1997), although this has been largely rejected because choices about (first-law) energy use do not reflect the full complexity of human behaviour and value judgements. However, it was soon recognized that it is second-law properties, such as entropy and exergy, which


more realistically reflect dissipative processes. Georgescu-Roegen (1971) was at the forefront of this movement with his advocacy of ‘the entropy law’, effectively the second law of thermodynamics, as a measure of economic scarcity. He viewed economic systems as ones in which energy is conserved, but in which entropy increases (or exergy degrades). A brave attempt to investigate interdisciplinary approaches to long-term energy problems and the employment of thermodynamic concepts was made in a workshop organized under the auspices of the Dutch Energy Study Centre (van Gool and Bruggink, 1985). Here similarities and differences between the physical sciences and economics were explicitly investigated, and many enduring insights obtained. A comprehensive review and critique of the use of thermodynamic ideas in environmental economics has, more recently, been produced by Söllner (1997). He again draws attention to the insight that energy and related properties can bring to economics and sustainability via the use of analogies and the setting of absolute limits respectively. An important medium-term example of the latter (Slesser, 1978; Söllner, 1997) is the dominant use and finite nature of fossil fuel resources. But there is no direct link between thermodynamic properties and the characteristics of economic systems. The former cannot explain the latter, let alone forecast the future paths of complex economies (Söllner, 1997).

Resource flows and exergy The exergy function has been viewed by several thermodynamicists as a potential tool for resource and/or emissions accounting (see, for example, Szargut et al., 1988; Dincer and Rosen, 1998). Material resources are viewed as having chemical exergy, because of their disequilibrium with the surrounding environmental conditions. When they undergo processing, these materials cause waste and therefore environmental damage. An increase in process efficiency will reduce the amount of waste and the exergy degradation. Thus, exergy is seen as a measure of the ‘value’ of the material, whereas process wastes have a potential to cause adverse changes in the environment. Dincer and Rosen (1998) term the exergy encapsulated in materials (positive) ‘constrained exergy’, in contrast to the (negative) ‘unconstrained exergy’ associated with emissions to the environment. They suggest that this provides a means of resource and emissions accounting, albeit one that needs further exploration. Szargut et al. (1988) describe the cumulative consumption of ‘natural exergy resources’ as the ‘coefficient of ecological cost’. Depleting or non-renewable (fossil and nuclear) fuels represent the largest component of this ecological cost. However, if they could be


replaced by ‘income’ energy sources, like nuclear fusion or solar energy, then these could be utilized to extract fuels from lean raw materials. It would obviously require greater exergy consumption, but this would be of little consequence in a world driven by income resources. Szargut et al. (1988) argue that expressing waste products in terms of exergy, in a manner more recently employed by Dincer and Rosen (1998), may be oversimplified. Certainly the environmental toxicology, or ‘ecotoxicology’, of waste products or pollutant emissions is unlikely to be reflected solely in their exergy content. Other environmental appraisal techniques, such as environmental life-cycle assessment (LCA), would be required to properly evaluate these emissions (Hammond, 2000a). There is clearly much that needs to be done in developing these exergy-based ideas and analysis techniques before they can be practically applied. They also suffer from the same criticism that can be levelled at the notion of an ‘exergy theory of value’ (by, for example, Hammond and Stapleton, 2001). Exergy is a measure of the maximum theoretical useful work obtainable from a thermal system (as it is brought into equilibrium with its surrounding environment), and this may be not be the only or relevant criterion in a particular situation. An innovative attempt to analyse different societies in terms of energy and exergy flow diagrams has been made by Sciubba (1995). He examined the sustainability of a variety of social structures ranging from ‘primitive’ tribal groups, via industrial (and ‘post-industrial’) societies, to a future envisaged as being dominated by a highly ‘robotised’ or cybernetically controlled social organization. In essence, energy and exergy were employed here as ‘technology level indicators’. Sciubba recognized that his model was an oversimplification of the complex interactions that arise between human societies and the natural world. Nevertheless, he believes this energy–exergy approach can adequately represent these various interactions. Consequently, the model could be used to examine alternative societal arrangements that might be ‘leaner’ in terms of resource extraction, while being as ‘comfortable’ as present industrialized societies. Not all forms of societal organization were found to be self-sustaining, with certain size and technology-related restrictions applying to most societies. Sciubba (1995) argues that neither resource scarcity nor biosphere capacity appears to constrain human development, although many energy analysts and environmentalists (for example, Goldemberg, 1996; Lovins, 1977; Parkin, 2000; Porritt, 2000) would suggest that the contrary is the case.


Ecology and ‘free energy’ In the field of ecology, strictly the branch of the natural sciences that deals with the relation between biological organisms and their physical surrounding, the concept of Gibbs free energy or function (G) is used in preference to exergy (Haynie, 2001). It is defined mathematically in equation (8.20):

G = H − TS

(8.20)

The connection between this thermodynamic property and the physical (or thermomechanical) part of exergy can to seen by comparison of this expression with the truncated equation (8.11). Gibbs free energy is again the maximum work that is available from a natural or other system, but it is not determined by reference to the surrounding environmental conditions. The dead state temperature is effectively taken to be absolute zero (−273 °C). However, in many cases, it is the change in free energy (δG) that is significant to the problem being considered, and this is effectively the same as the corresponding change in physical exergy (δE). Schneider and Kay (1994) have argued that the evolution of life from primitive to complex organizms involves processes similar to those governed by the second law of thermodynamics. They propose a new, thermodynamically oriented paradigm for the life sciences, including explanations for the origins of life, biological growth and patterns of biological evolution apparent in the fossil record. However, this approach has generated some controversy. Corning and Kline (1998) have expressed their exasperation with this line of reasoning. They argue that life is too complex and is sensitive to processes at a detailed level. Exergy (or, in their term, ‘available energy’) analysis has therefore been misused when applied to the biological domain. It focused on energy waste, whereas perhaps a more important consideration is the way in which energy is captured and utilized during the struggle to survive. These arguments mirror those that Kline (1999) employed more generally in relation to the adoption of thermodynamic concepts in other disciplines, particularly in informatics. A cybernetic perspective leads Corning and Kline (1998) to suggest that certain law-like ‘bioeconomic’ principles are more likely to constrain thermodynamic processes in living systems. Natural selection may favour organisms that improve energy capture.


Concluding remarks Engineering sustainability There are various ways in which the energy system interacts with the requirements of sustainable development. A strict interpretation of the Brundtland Commission injunction, or the ‘Natural Step’ system conditions (Porritt, 2000), would mean a rapid changeover to renewable energy, and the conservation of non-renewable sources (fossil fuels and uranium). This in turn could lead to a significant reduction in pollutant emissions, an unwanted side-effect of the energy sector, that give rise to damaging impacts at local, regional and global scales. Only in this way could the biosphere be protected for future generations. However, dramatic changes to the nature of the energy system appear unlikely in the short to medium term. Even Sara Parkin (2000) acknowledges that the timescale for achieving sustainability could be in the range 2050–2100, or longer. Current UK measures to combat climate change will reduce CO 2 emissions (see Figure 8.2) to the domestic target of a 20 per cent fall below 1990 levels by about 2010. But this is a modest achievement compared with the perceived global need to reduce GHG emissions by some 60 per cent to stabilize the climate. The UK government (DTI, 2003) has accepted the recommendation by the Royal Commission on Environmental Pollution (RCEP, 2000) that Britain should adopt a target of reducing CO 2 emissions by 60 per cent from 1997 levels by about 2050. They have charted a new path for energy policy with a focus on low-carbon options – principally energy conservation measures and renewable energy technologies for the long term (with the nuclear power option kept open and in reserve). A robust transitional energy strategy is clearly required with a focus on energy efficiency (a move in the direction of Factor Four or more technologies), and minimizing significantly pollutant emissions. The elements of such a strategy will change over time, and the ‘optimal’ mix at any given instant will be uncertain when viewed from the present. Engineers have much to contribute in terms of identifying opportunities for process improvement using thermodynamic and other related means of analysis, such as those discussed here. Actions taken to reduce pollutant emissions from power stations, industrial processes and the other sectors of the economy would have benefits on both a local and global scale. Measures to limit acid precursors from electricity generation, for example, will also reduce GHG emissions. Policies of this type are therefore of a ‘win–win’ nature (Hammond, 2000a). Central government needs to stimulate implementation, and develop an enhanced ‘systems-modelling’ capability to ensure that the


sum of the parts meet national targets (Hammond, 2000a). Thus, the environmental and sustainable development challenges of the twenty first century might be met by way of a mixture of vision and realism. Thermodynamic analysis again has an important role to play on that wider scale of effort.

Thermodynamics and sustainability: energy systems and beyond Thermodynamic methods will undoubtedly form an indispensable part of the toolkit needed to secure a sustainable future (Hammond, 2003); see also Figure 8.1 (Parkin, 2000). It is clear from the discussion here that exergy analysis can provide an important tool for the understanding of complex energy systems. It was used by Reistad (1975) to identify the true nature of losses in power plant. He noted that enthalpy losses arise in the condenser, and therefore offer little prospect of improvement other than by way of a ‘bottoming cycle’. However, exergy analysis indicates that second-law losses are associated with combustion processes and with heat exchangers. Making improvements at that end of the cycle will have the ‘knock-on’ benefit of also giving rise to higher first-law efficiencies. Hammond and Stapleton (2001) argue that the feasibility of such changes is not as important as a proper comprehension of the thermodynamic processes involved. Now it is possible, of course, to identify second-law-type improvement potential without explicitly adopting exergy analysis. Indeed Chapman (1976) correctly discerned the waste inherent in using nuclear-generated electricity for space heating rather than for electrical appliances or mechanical drives. He employed first-law energy analysis, but supplemented this via an implicit understanding of the second-law issues. Hammond (2000a) consequently advocated the use of exergy analysis as one tool among several quantitative approaches that should be employed to study energy systems, in addition to the more traditional first-law energy analysis. The components of this ‘sustainability toolkit’, which would also include environmental life-cycle assessment and cost–benefit analysis (CBA), all have their particular advantages and disadvantages (Hammond, 2000a). However, there is a tendency for some thermodynamicists to elevate second-law analysis to a pivotal position. Gaggioli (1980), for instance, views exergy as representing thermodynamic ‘value’, and regards the second-law efficiency as the ‘true’ efficiency. This is not warranted, and Hammond and Stapleton (2001) have argued that it should be discouraged. On first- and second-law thermodynamic grounds the rank order for the construction of new fossil-fuelled power plant would be CHP or


cogeneration schemes, CCGTs, and integrated coal gasification combined-cycle (IGCC) plants, reflecting the highest-to-lowest conversion efficiencies respectively. Modern IGCC plants have conversion efficiencies of 48–51 per cent and lead to a reduction in CO 2 emissions of better than 20 per cent compared with conventional coal-fired plant (Hammond, 2000b). Hydropower and wind turbines also have high thermodynamic efficiencies; the former being around 65–75 per cent. Unfortunately the UK has already exhausted all its favourable sites for large-scale hydropower and pumped storage schemes. Although there are many suitable locations for onshore wind energy generators in the British Isles, they are meeting significant community resistance at local planning enquiries owing to their perceived effects of landscape disruption and noise emission (Hammond, 2000b). The utilization of offshore wind turbine arrays may avoid these difficulties, but only at higher life-cycle financial costs. Both offshore wind ‘farms’ and the growing of energy crops (biomass) as a primary use for agricultural land have been given a strong endorsement by the RCEP (2000) as possible long-term energy options. Solar energy systems, such as modern grid-connected PV devices, are diffuse and have low conversion efficiencies compared with their 5500 K potential. Nevertheless, they are renewable rather than depletable energy systems. Consequently, Lovins (1977) has argued that renewable energy sources in general should be viewed as having a premium over fossil fuels and uranium, with their finite life. This is another reason for not giving primacy to the results of second-law exergy analysis. An important finding, reinforced by the study of Hammond and Stapleton (2001), relates to the thermodynamic inefficiency of using electricity (from whatever source) to provide low-grade space heating. Several ways in which thermodynamic concepts have been utilized by practitioners outside the energy sector have been examined. Many other disciplines have attempted to invoke these ideas in the name of environmental sustainability, not least in fields such as ecology and environmental economics. Concern about resource depletion and environmental degradation is common in these disciplines. Human development and its ecological consequences are seen by some analysts to mirror energy transformations within society. The concept of ‘exergy’, which follows from the second-law of thermodynamics, has been viewed as providing the basis of a tool for resource and/or emissions accounting, as well as indicating natural limits on the attainment of sustainability. However, the application of these thermodynamic ideas outside the sphere of energy systems, from which they were first derived, is not without its critics. These concepts are often employed by


way of analogy, or simply in a metaphorical sense. The link between the efficiency of resource utilization, pollutant emissions and ‘exergy consumption’ is real, but not direct. Indeed the relative ‘ecotoxicology’ of pollutants is unlikely to be a function of their exergy, and would need to be assessed via other environmental appraisal techniques (such as LCA). Clearly it is necessary to apply the methods of energy and exergy analysis with some care when trying to draw conclusions about the criteria for, and pathways to, sustainability.

Energy, sustainability, and the international dimension The present work has focused primarily on energy-related considerations in the developed or industrialized countries, particularly the UK. It is certainly important that these countries play their full part in maintaining environmental sustainability as they currently emit the bulk of pollutants into the atmosphere worldwide. But sustainable development must also be viewed in a global context. The resource base of the planet is not well defined; limits are often unclear until they are almost reached. One of the great challenges for the twenty first century is therefore to improve dramatically the efficiency of resource use, particularly of non-renewable energy, across the planet so that humankind will ‘tread lightly on the earth’ (Hammond, 2000a). Clearly the industrial nations, whose societies are by far the most resource-intensive, will need to take the lead. It will require difficult decisions for the West in terms of market intervention to stimulate the development of sustainable technologies, and possibly to induce changes in lifestyles. The task facing the nearly 80 per cent of the world population that live in developing countries is daunting. They have, in most cases, rapidly growing populations that will drive up energy consumption and environmental pollution. This will feed back to the whole planet, and thereby alter the climate in the wealthier nations. Consequently they need assistance from industrial countries to promote Third World economic growth, which will in time induce a ‘demographic transition’ (WCED, 1987), as well as improving the efficiency of their energy systems. These are matters of interregional and intergenerational ethics, rather than purely scientific debate. A more equitable sharing of world income and resources is likely to be a prerequisite for sustainable development in the long term. Environmental sustainability would certainly be aided by the transfer of best-practice, or ‘leapfrog’, energy technologies from the richer to the poorer regions (Goldemberg, 1996). This will ultimately be in the interests of all the citizens of ‘Spaceship Earth’.


Acknowledgements This paper has been adapted, in part, from an invited lecture presented at the Seventh UK National Heat Transfer Conference, Nottingham University, 11–12 September 2001. The author’s research on energy systems and environmental sustainability has been supported by research grants awarded by the UK Engineering and Physical Sciences Research Council (most recently under grants GR/J92910, GR/L02227 and GR/L26858). He would also like to acknowledge the support of British Gas plc, now demerged as BGplc and Centrica plc, who have partially funded his professorship. However, the views expressed in this paper are those of the author alone, and do not necessarily reflect the policies of either of the new companies. Finally, the author wishes to acknowledge the care with which Sarah Fuge prepared the typescript and Gill Green prepared the figures.

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Geoffrey P. Hammond 209 Hammond, G.P. (2000a) ‘Energy and the environment’, in A. Warhurst (ed.), Towards an Collaborative Environment Research Agenda: Challenges for Business and Society, pp. 139–78. London: Macmillan. Hammond, G.P. (2000b) ‘Energy, environment and sustainable development: a UK perspective’, Transactions of the Institution of Chemical Engineers Part B: Process Safety and Environmental Protection, 78, 304–23. Hammond, G.P. (2003) ‘Book review: Kline, S.J., The Low-Down on Entropy and Interpretive Thermodynamics’, Proceedings of the Institution of Mechanical Engineers Part A: Journal of Power and Energy, 217(3), 337–39. Hammond, G.P. and Stapleton, A.J. (2001) ‘Exergy analysis of the United Kingdom energy system’, Proceedings of the Institution of Mechanical Engineers Part A: Journal of Power and Energy, 215(2), 141–62. Haynie, D.T. (2001) Biological Thermodynamics. Cambridge: CUP. Horlock, J.H. (1987) Cogeneration – Combined Heat and Power (CHP). Oxford: Pergamon. Kline, S.J. (1999) The Low-Down on Entropy and Interpretive Thermodynamics. La Cañada, CA: DCW Industries. Kotas, T.J. (1985) The Exergy Method of Thermal Plant Analysis. London: Butterworth. Lovins, A.B. (1977) Soft Energy Paths. Harmondsworth: Penguin. May, R. (1997) Climate Change. London: Office of Science and Technology. Mueller, R.F. (1971) ‘Thermodynamics of environmental degradation’, Proceedings of the Annual Meeting of the American Geophysical Union, Washington, DC. Nakicenovic, N., Grübler, A. and Mcdonald, A. (1998) Global Energy Perspectives. Cambridge University Press. Natural Environment Research Council (NERC) (1997) Climate Change: Scientific Certainties and Uncertainties. Swindon. O’Callaghan, P.W. (1993) Energy Management. London: McGraw-Hill. Parkin, S. (2000) ‘Sustainable development: the concept and the practical challenge’, Proceedings of the Institution of Civil Engineers: Civil Engineering, 138, 3–8. Porritt, J. (2000) Playing Safe: Science and the Environment. London: Thames & Hudson. Reistad, G.M. (1975) ‘Available energy conversion and utilization in the United States’, Transactions of the ASME: Journal of Engineering for Power, 97, 429–34. Rosen, M.A. (1992) ‘Evaluation of energy utilization efficiency in Canada using energy and exergy analysis’, Energy, 17(4), 339–50. Rosen, M.A. and Dincer, I. (1997) ‘Sectoral energy and exergy modelling of Turkey’, Transactions of the ASME: Journal of Energy Resources Technology, 119, 200–4. Royal Commission on Environmental Pollution (RCEP) (2000) Twenty-second Report: Energy – The Changing Climate. London: Stationery Office. Sciubba, E. (1995) ‘Modelling the energetic and exergetic self-sustainability of societies with different structures’, Transactions of the ASME: Journal of Energy Resources Technology, 177, 75–86. Schneider, E.D. and Kay, J.J. (1994) ‘Life as a manifestation of the second law of Thermodynamics’, Mathematical and Computer Modelling, 19(6–8), 25–48. Slesser, M. (1978) Energy in the Economy. London: Macmillan. Söllner, F. (1997) ‘A reexamination of the role of thermodynamics for environmental economics’, Ecological Economics, 22, 175–201. Szargut, J., Morris, D.R. and Steward, F.R. (1988) Exergy Analysis of Thermal, Chemical and Metallurgical Processes. New York: Hemisphere.

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9 Life-Cycle Design for Engineered Timber Products Martin P. Ansell, Richard J. Murphy and Bill Hillier

Summary Life-cycle and design (LCD) is presented as a tool for evaluating the design aspects of life-cycle assessment (LCA) and applied to engineered timber products. The LCD approach is valuable for assessing the environmental impact of competing designs or design modifications. We examine two case-study examples of LCD applied to engineered timber products, namely the ash frame of a sports car and oriented strand board (OSB), a commercial panel product. Design improvements proposed for the timber frame are assessed in terms of environmental impact in the first case-study. The environmental implications of improved strand alignment and change of resin binder system for the OSB are evaluated in the second case-study. The LCD programme has highlighted the issue of energy/fuel consumption in the manufacture and use of the sports car frame. In the OSB study, weight reduction in panels derived from improved strand alignment, leading to reduced transport emissions, was not sufficient to overcome the climate change benefit associated with the ability of timber to sequester carbon. An ‘incremental LCA’ approach has been proposed and applied to the LCD of engineered timber products, which follows the design process from concept to manufactured product.

Introduction Life-cycle assessment (LCA) is a systems analysis tool for evaluating the environmental impacts of products or services over their whole life-cycle from the ‘cradle’ (raw material acquisition) to the ‘grave’ (disposal or recycling). The emphasis in LCA is to generate transparent and complete 211

212 Life-Cycle Design for Engineered Timber Products

assessments of environmental impact resulting from all stages of the life-cycle and to use this to evaluate the environmental attributes of the product or service in a holistic way. This approach has the potential to avoid mistakes engendered by ‘single-issue’ or ‘single-focus’ environmental assessments. LCA is well suited to the evaluation of established products and processes where materials flows and data requirements are readily identified. However, there is also scope for using LCA early in the design or product optimization process to develop sound decisions on the best available environmental option for further implementation. LCAs are of necessity detailed and time-consuming and thus do not lend themselves easily to reduction or simplistic conclusion drawing. This can make the approach unwieldy and impose a heavy burden of redundant work when early design options are assessed with LCA, only to be discarded later in the design evolution. The sub-discipline of life-cycle design (LCD) examines the design aspects of LCA and attempts to establish associations between design decisions and overall environmental acceptability (Medland and McPherson, 2001). An EPSRC-funded programme entitled ‘LCD for Engineered Timber Products’ was granted to the authors in 1998. The award allowed joint research, based on case studies with industrial partners, to be conducted on the issues involved in designing engineered timber products from a whole-life-cycle perspective. Fundamental principles that might be applicable to these materials were also sought. This report presents the LCAoriented aspects of the research undertaken at Imperial College London in the context of the design-oriented activities at the University of Bath. The research conducted by the institutions was integrated throughout the three-year programme, demonstrating the benefits of the LCD approach.

Objectives A key aspect of the research has been integration with manufacturers of engineered timber products. Two LCD case-studies are described in this chapter, namely an investigation of the timber frame of a sports car manufactured by traditional methods and the evaluation of a wood composite panel product in mass production. The following key advances have been made: 1. Full LCA process descriptions have been established for the ash frame of the Morgan sports car at the Morgan Motor Company Ltd (MMC) and for oriented strand board (OSB) at Nexfor Ltd.

Martin P. Ansell, Richard J. Murphy and Bill Hillier 213

2. Engineering options have been defined for enhancing the manufacture and performance of the Morgan ash frame and OSB. 3. The environmental implications of introducing the engineering options have been assessed. For the Morgan frame, the environmental profile of the materials of manufacture and the environmental impact of the redesign of the ash frame have been considered in comparison with an all-steel frame. For OSB at Nexfor Ltd, environmental advances attained through design reflect the best strategies for converting trees into strands and for orienting strands on the production line conveyer before hot pressing to form board products. 4. Engineering and environmental advantages have been achieved by refining the design of engineered timber materials and products have been integrated. Two industrial case-studies are presented below, after which the concept of ‘incremental’ LCA that arose from the LCD research on engineered timber products, which enables an efficient transition to be made from a design idea to a full LCA, is introduced.

Case-study 1. Timber frame of the Morgan car (with the Morgan Motor Company Ltd) The frames of current models of the Morgan sports car, including the latest Aero 8 model, are constructed in traditional, coach-built form from solid ash and plywood. LCD research has: 1. produced a solid model of the Plus 4 frame; 2. compared the performance of traditional joints in the frame with joints based on bonded-in rods; 3. optimized the performance of the frame in lateral impact; and 4. generated a comparative LCA of the standard ash frame and a redesigned ash frame and ‘benchmarked’ these frames with a hypothetical, alternative steel frame. The principal engineered timber interest here is in the use of a complex timber frame (72 shaped ash components, plus plywood) in the design of the motor car. The frame (and the rest of the car) has ‘evolved’ over the lifetime of the company since 1936 (the first ‘4 + 4’ model) and the present study examined a potential next step in this evolution. The MMC did not possess accurate design drawings of the frame when the LCD research began. MMC delivered a complete ash frame and steel chassis


to the University of Bath to allow accurate spatial measurements of the frame dimensions to be made, using an optical rail anchored to the chassis via a steel foundation. A solid model for the frame (Figure 9.1) was created by Colin McPherson (RA) using AutoCAD Mechanical DeskTop, in order to fully understand its construction and to provide a platform for examining design alternatives. The model can be rotated in 3D to allow inspection from any angle and virtual design modifications may be made. The frame design has evolved over many years at Malvern Link, driven by aesthetics and tradition as well as function. The frame elements are connected by traditional mortise-and-tenon joints and lap joints secured by screws and adhesives. Some elements, such as the top member of the door, have double curvature and the manufacture, alignment and connection of the parts require skill and time. A rectangular assembly at the rear of the frame is designed to act as a brace between the wheel arches and to carry the spare wheel. The mechanical performance of traditional joints located in this assembly (Figure 9.2) was compared with that of newly designed joints based on pairs of pultruded GRP rods bonded directly into drilled holes in the ash. Moment-resisting test pieces were cut from these assemblies and evaluated in comparison with joints based on pairs of bonded-in rods (Table 9.1). Joints fabricated from 8 mm diameter dowels out-performed the half-lap joints by a factor of two and environmental benefits are expected, derived from more rapid manufacture. The frame meets European side-impact standards and has an excellent record in standard seatbelt pull tests conducted at MIRA. However there was scope for developing the design of the dashboard arch and the doors,

Figure 9.1

Solid model of a Morgan frame


Figure 9.2

Rear assembly of a Morgan frame

Table 9.1

Performance of traditional joints versus joints based on bonded-in rods

Joint type

Number of tests

Mean peak force (kN)

Mean bending moment (N m)

Mortise and tenon + screw

9

0.88

88

Half-lap + screw

18

1.71

171

3

1.48

148

3

2.64

264

2

3.95

395

Bonded-in rod 2 × 4 mm dowels Bonded-in rod 2 × 6 mm dowels Bonded-in rod 2 × 8 mm dowels

Failure mode

Rotation of tenon in mortise with screw pulling through. Rotation of tenon in mortise with screw pulling through. Dowels break away from resin and pull out. Dowels break away from resin and pull out. Dowels break away from resin and pull out.

to further improve the performance in lateral impact to meet stringent US FMVSS214 standards. The frame was redesigned using an extra 5 kg of ash timber, 1 kg of PVA adhesive and 1 kg of GRP rods (Figure 9.3). The following questions were addressed:

• Does redesigning the frame to achieve higher performance impose a significant increase in environmental impact?

• Does the use of engineered timber materials represent an environmental ‘gain’ in comparison with possible alternative materials?


Figure 9.3

Redesign of front lateral arch

LCA research was conducted according to international best practice as represented in the ISO 14040 series of standards and the SETAC guidelines. SIMA Pro v4 and Imperial College London in-house (spreadsheet-based) LCA software was used to conduct the analyses. The following parameters were adopted for the LCA: Goal of the study – To assess the environmental impact of the ‘standard’ ash timber frame and two hypothetical car frames of a Morgan car. Scope of the study – To present the designer with information on the effects of mechanical modification to the frame on its eco-profile. Functional unit – The body frame for a Morgan Plus 8 model, with fixed shape and dimensions, to be used for a period of 50 years and 200 000 km of motoring. It is recognized that both the redesigned ash frame and the steel frame are likely to have crash impact properties different from those of the ‘standard’ frame. System boundaries – Limited to zero-order processes.

Data sources Input and output tables for all unit processes and/or materials are held at Imperial College London. Volumes of commodities and timber needed for the ash frame were obtained from measurements at the factory. Information on the origins of timber, plywood and ingredients needed for the different commodities were obtained from the suppliers. Data on timber and plywood production is from literature sources (see Hillier and Murphy, 2000; Hillier, 2001). Data on wood preservatives, poly


vinyl acetate (PVA or PVAc), primer and paint is from in-house data at Imperial. Data for production of steel and fibreglass come from TU Delft, The Netherlands.

Assumptions Transport distances for commodities within the UK are based on UK transport statistics. Transport distances for raw materials from abroad are based on estimates made in De Castro (1992).

Frame and redesigns The ‘standard’ frame was assessed together with a timber redesign of the dashboard arch and the doors, to further improve the performance in lateral impact. The frame redesign consumed an extra 5 kg of ash timber, 1 kg of PVA adhesive and 1 kg of GRP rods (Figures 9.3 and 9.4). The existing ash frame was measured directly and is a ‘real’ product providing the base LCA inventory. The redesigned timber frame was calculated from the timber frame + extra wood and glue + fibreglass as a new process. A hypothetical steel frame was also considered, this being based on several assumptions, most notably on its form being a shape mirror for the wood frame and the masses of steel involved in this. In the use phase of the life-cycle of the timber frames some loss of VOC emissions was modelled (from the wood preservatives) and, because the redesigned timber frame was somewhat heavier, extra exhaust emissions were also incurred. The use phase of the hypothetical steel frame incurred extensive extra exhaust emissions owing to its mass being

Figure 9.4

Redesign of joints


Harvesting

Plywood factory (6 mm), Far East

Softwood forest production, Finland

Harvesting

Plywood factory (9 mm), Finland

Hardwood forest production, SE Asia–Africa

Harvesting

Mixed forest production, south UK

Harvesting

Hardwood forest production, Far East

Plywood factory (9.5 mm), UK Kiln-dried timber

Carbonisation and destillation for coal tar

Coal extraction + cleaning, UK Deep mining 69%, surface 25%

Blenders, UK Creosote

Ammonium thiocyanate

Natural gas extraction, North sea

Ammonia Phenol

Benzene

Resin Urea

PF resin

Benzaldehyde Methanol

Formaldehyde

UF glue

Benzyl Alcohol Vinyl acetate

Acetic acid

CO

Ethylene Crude oil extraction 50% UK – 50%, Norway /Middle East Casserite extraction, Bolivia/Malaysia

Butylene

SnO2

Rock salt / brine extraction, North Sea

PVAc

M o r g a n s

Cl2

NaCl

Lime extraction, UK

Tintetrachloride

TBTO

NaOH

Lime

Aluminium

Bauxite mining, Australia Ore extraction, UK

Figure 9.5

Steel/Iron production

Flow diagram for the ash frame

greater than that of the standard wood frame. The end of life of all frames was the municipal waste scenario in SimaPro v4. The complete manufacturing system of the ash frame is shown in Figure 9.5 (Spong et al., 1999). Based on this and the use and end-of-life phases, the environmental impact assessment of the frames was made using Eco-Indicators 95. The outcome is summarized in Figure 9.6. The redesigned frame exhibited a slight additional environmental impact compared with the ‘standard’ frame but both scored substantially better than the hypothetical steel frame. The integrated LCD approach to the Morgan car frame has demonstrated that an ‘uprated’ frame can be developed with minimal increase in environmental impact. Furthermore, wood-based designs that capitalize on the favourable strength-to-weight properties of the ash timber can afford environmental benefits in comparison with other, heavier materials.


Ecopoints in mPt

600

Summer smog

500

Winter smog

400

Carcinogenity

300

Heavy metals

200

Eutrophication

100

Acidification Ozone

0 Ash original

Ash redesign

Steel

Greenhouse

Figure 9.6 Summary of the LCA environmental impacts of the three frames (mpt is a measure of global environment impact based on political targets for reduction of emissions)

This latter point is highly relevant to the use phase of the car life-cycle where the additional mass of the hypothetical steel frame imposed an increased fuel consumption, giving an additional environmental impact equivalent to more than double that of the manufacture of the entire ash frame. It was clear that where non-renewable energy consumption is linked directly to the mass of the frame then considerable environmental benefits can be achieved by ‘lightweight’ designs and design changes imposing mass increases should be minimized. In the case of the wood frames, the single, most readily improvable aspect of the life-cycle within the LCD parameters at MMC would be modifications to the wood preservative treatment system to reduce or eliminate VOC emissions (the main contributor to summer smog – see Figure 8.6).

Case-study 2. Oriented strand board (with Nexfor Ltd) OSB is a wood-based panel product manufactured in the UK by Nexfor Ltd (formerly CSC Forest Products Ltd) at Morayhill, near Inverness. It is manufactured in standard sizes under heat and pressure from wood strands, bonded with a synthetic adhesive and wax. Type F2 boards (BS 5669 : Part 3), which use adhesives that are inherently moistureresistant and confer higher levels of durability, were analysed here. The advantages of OSB as an engineered panel product stem from its structure, based on strands or flakes, produced from small-diameter logs grown in local forests within a 50-mile (80-km) radius of the factory. In contrast plywood is manufactured from sheets of veneer, peeled from older, larger-diameter trees, harvested from tropical and temperate forests. The market share of plywood is falling as OSB production increases. Other


competing panel products include chipboard, based on small chips, and medium density fibreboard (MDF), based on wood fibre. Both MDF and chipboard suffer from poor creep performance under constant load, compared with OSB. So what are the LCD challenges associated with OSB? Panels of OSB are produced in standard sizes and are used in construction for flooring, walls and roofs. Panels are generally loaded in bending so the flexural properties are critical and these properties depend on the disposition of strands at the panel surfaces. In the factory strands are delivered to a forming mat on a conveyer, where the aim is to orient the top and bottom layers along the conveyer axis and the core strands at 90° to this direction. The surface strand orientation, size and shape must be optimized to maximize mechanical strength in flexure. Furthermore the strands are flaked from a blend of wood species, typically 65–70 per cent Scots pine, 25 per cent Sitka spruce and 7 per cent Douglas fir and larch. As the supply of Scots pine declines more of the lower-quality spruce will be substituted. The product life-cycle, in terms of the energy and materials inputs and outputs within the factory system, and the panel design, in terms of wood species, strand dimensions and orientation, are therefore closely linked. Imperial made a full LCA of the Nexfor factory, while Bath engaged in a series of design studies of OSB based on image analysis. The Bath study has: 1. developed a filtered image analysis (FIA) technique (Nishimura et al., 2002; Nishimura and Ansell, 2002c) for processing images from a digital camera to determine the orientation of strands in OSB by image enhancement of the wood grain in the population of strands (Figure 9.7);

Figure 9.7

Filtered image analysis of the OSB strands


Figure 9.8

Measurement position on the OSB line

Figure 9.9

Categorization of the strands into five types

2. measured the orientation of strands in the OSB mat on the production line (Figure 9.8) on a real-time basis (Nishimura and Ansell, 2000a, 2002b); 3. used Optimas software to automatically evaluate dimensional parameters for individual strands, categorizing them into five strand types (Figure 9.9);


Figure 9.10

Manufacture of the model panel

25

Relative intensity (%)

Strand type 1 Strand type 2 Strand type 3 Strand type 4 Strand type 5

20 15

10 5

–90

Figure 9.11

–60

0 –30 0 30 Fibre orientation (degree)

60

90

Relative intensity of the fibre orientation

4. manufactured model panels in the laboratory based on these five strand sizes (Figure 9.10) with strands aligned as straight as possible by hand and 5. determined strand parameters and orientation in these panels by image analysis (Figure 9.11) and related structure to mechanical properties in flexure (Figure 9.12) (Nishimura et al., 2001; Nishimura and Ansell, 2002a,b; Nishimura et al., 2003).


MOE (MPa)

1.20E + 04 9.00E + 03 6.00E + 03 3.00E + 03 0.00E + 00 Strand type 1

Strand type 2

Strand type 3

Strand type 4

Strand type 5

Board type Figure 9.12 Relationship between the modulus of elasticity (MOE) and the board type based on the strand type

There is good correlation between strand orientation, measured manually, and strand orientation measured by FIA (Figure 9.7), offering great potential for on-line process control (Figure 9.8). The arbitrary classification of strands into five categories (Figure 9.9) and the manufacture of panels in the laboratory (Figure 9.10) have demonstrated that long slender strands (type 3) offer the highest potential for achieving optimum strand alignment (Figure 9.11) and superior mechanical properties (Figure 9.12). For example the MOE of panels made from strand type 3 is almost double the MOE of strand type 5 panels because of the tendency of smaller strands to rotate during hot pressing. The results from these unique design studies have been integrated with a factory LCA (Imperial) to assess the environmental impact of design optimization. The surface strand orientation, size and shape must be optimized to maximize mechanical strength in flexure. The product life-cycle and the panel design, in terms of wood and resin inputs, strand dimensions and orientation, are therefore closely linked. A full LCA of the Nexfor OSB manufacture and its use in a model flat roof construction was undertaken to evaluate the environmental implications of design modifications to the panels: Goal of the study – To assess the environmental impact of the ‘standard’ and modified OSB panels. Scope of the study – To assess the effects of modification in the context of OSB use in a ‘typical’ building application. Functional unit – Provision of a weatherproof outer layer to a flat roof, of the cold-roof type (as specified in Agrément certificate BBA 92/2781)

224 Life-Cycle Design for Engineered Timber Products Nailing at 150 mm centres along supported edges, and at 300 mm centres intermediately

10 mm perimeter expansion gap

Nogging support at long edges to allow ventilation

Plasterboard ceiling

All edges to be fully supported (20 mm minimum bearing) Joists at 400 mm centres Figure 9.13

Layout for the OSB in the domestic flat roof

with an area of 3 × 4 m (12 m2) above a habitable dwelling for a period of 50 years (see Figure 9.13). This included sealants, mastic, fixings, supports, coverings plus installation/maintenance of a weatherproof barrier and full replacement at 25 years (for 50 years’ service). System Boundaries – Zero-order processes – as previously. Data Sources – Direct measurements at Nexfor Ltd, design changes Nexfor Ltd and Bath. Assumptions – Transport within UK derived from UK average statistics. Underlying ceiling components (plasterboard, vapour barrier, thermal insulation) were not considered to be part of the roof and their impacts were excluded. Insulation properties of roof assumed to be dominated by the added insulation and so no thermal differences were assigned to the different OSBs.

OSB and design changes The ‘standard’ oriented strand board (OSB) was based on manufacture with a phenol formaldehyde (PF), in powdered form, added at a rate of ≈2.5 per cent (dry wood basis). A paraffin slack wax is added at a rate of 1.5 per cent. The timber used is 85 per cent Scots pine. The remaining


15 per cent is composed of varying proportions of spruce, larch, Douglas fir and other mixed conifers. All timber used is between 15 and 40 years’ growth, derived from first and second thinnings and tops. The final density of the board is between 600 and 650 kg/m3. Installation of the boards requires cutting on-site, and the use of half-sized boards to minimize waste, as is common practice, with cuts is assumed. Fixings are galvanised mild-steel nails. Product design improvements based on flake orientation studies at Bath and Nexfor Ltd process engineering improvements were examined. The study has: 1. developed an LCA for ‘typical’ PF-resin-bonded OSB at Nexfor Ltd (Figure 9.14); 2. analysed the effect of an optimized flake orientation developed in research at Bath, giving board density reduction of 5 per cent compared with the ‘typical’ OSB for the same mechanical/physical property specification (Figure 9.14); 3. analysed the effect of change from PF to PMDI (polymeric methylene diisocyanate) resin at Nexfor Ltd (Figure 9.14).

12 10

Change in normalised scores against typical OSB (%)

8 6 4 2 0 –2 –4 –6 –8 –10 Total

Human toxicity

Ecotoxicity

Eutrophication Low-level Climate change ozone creation (100 years)

Flake orientation

Fossil fuel depletion

Transport pollution and congestion

MDI OSB

Figure 9.14 LCA profile of the modified OSB in comparison with a ‘standard’ PF-bonded OSB. Ecotoxicity is the toxicity to an ecosystem where the scale of the ecosystem is specified in the LCA


These studies produced a number of striking findings concerning woodbased materials and panel products. Both changes modelled in the manufacture of OSB produced a reduction in mass of wood and other materials in the panel for mechanical/physical properties equivalent to those of the standard OSB. In this case, density reduction had a negative effect (≈8 per cent increase) upon climate change (global warming potential). The disadvantage of the ‘lightweighting’ in the OSB is a striking demonstration of the positive environmental effects that can occur from the use of timber materials via carbon sequestration. The difference from the Morgan case-study are due to substantially higher recovery rates of wood material into the final product with the OSB (flakes vs. curved solid members) and incorporation of residues into the final product (use of ‘fines’ in OSB). It is also clear that each design modification to the OSB had a relatively small effect overall on the environmental impact of the OSB (±3 per cent). However, change of the ancillary material (in this case to PMDI resin) exhibited a negative influence, whereas the processing ‘efficiency’ gain on the standard OSB from the modelled improvement in flake orientation was all positive with the exception of climate change (discussed above). A similar result was also found in the Morgan case-study where the new ancillary material for bonded-in rods led to an increase in environmental impact, although again this was very small.

Integration of LCA methods in LCD for engineered timber products A key aspect of success in applying LCA to design projects is to achieve close integration and understanding of the LCA activities with the technical design and development activities. This was exemplified in the strong collaboration between the participating universities. From the beginning of the project, all partners developed a clear awareness of the nature of LCA and of the general requirements and needs of the LCA technique. An important finding of the collaborative process of the project was the clear need to adapt the ‘conventional’ LCA procedure to the realities of the design and redesign process. The conventional principles, procedures and methods of LCA are now strongly based on the terminology and structure of the ISO environmental management systems, tools and standards on LCA (ISO 14040 series). This establishes a strict subdivision of the tasks and procedures needed for conducting an LCA. However, in the development of a new design or redesign the range of technical possibilities


to be considered varies depending on the type of development project, but the most innovative and valuable solutions may come from the greatest degree of design freedom. In such cases, the applicability of the full LCA process is very limited, since it is based upon the full specification of the process chain. These details, by the nature of the design process, are in flux, and may encompass an impracticably large range of possibilities. Furthermore, the design process need not even begin from a specific functional application (which is an absolute requirement for an LCA), but may start, for example, as a search for workable applications for new material or process possibilities. The design process by which that range of possibilities is reduced is also not generally led by environmental data. As experimental and development data accrue, technical difficulty and economic and market issues will all be significant drivers for rejecting possibilities. This situation is illustrated in Figure 9.15 as a three-dimensional space in which the optimal solutions are those with a low technical difficulty and low cost which also have a high potential environmental benefit. Low-difficulty, low-cost options with modest potential environmental gains might also be subject to LCA. Options with a high cost or high technical difficulty, or both, are likely to be rejected, even for potentially large environmental gains. This illustration is entirely compatible with the principle of ‘best available technology not entailing excessive cost’ (BATNEEC). This analysis shows the place of a full LCA as an end-point of the procedure for successful designs, but this is not practicable for every possible option which may occur anywhere in the design space at the

Examine

t

Full LCA

Reject

jec

st

Re

Environmental benefit

Examine

Examine closely

Reject

ic

co

m

o on

Ec

Technical difficulty Figure 9.15

The role of LCA in establishing the best development options


project inception. There is therefore a need for a structured procedure in which the greatest practical amount of environmental data are provided for examination alongside technical and economic data. As the range of possibilities is reduced, the detail and completeness of environmental data escalate, making possible full LCA data for the final options. We propose a procedure of ‘Incremental LCA’ to do this which is not a streamlined or abridged LCA, but rather a gradual route to a full LCA. Incremental LCA aims to enhance the application of life-cycle thinking and LCA to LCD for engineered timber products. Its structure and framework maximize the value of LCA within the design process and minimize the redundancy of data that result from changes in a design during its development.

Implementation of incremental LCA It is possible to identify three distinct stages from the initiation of a design to the completed product specification – ‘elimination/reduction’, ‘prioritization’ and ‘elaboration’ (see Figure 9.16). These are briefly as follows:

• In the elimination/reduction phase, the activities are directed at estimating environmental attributes of a wide range of alternatives and eliminating those options that have low technical merit (that is, are least likely to produce a working solution) or extremely high technical barriers, safety risks or economic cost. Provided that generic environmental data and the correct expertise are available, this can be a rapid process based around group working and estimation.

Design idea

Full LCA

Role of environmental data

Range of design options Elimination/ reduction Figure 9.16

Prioritization

Elaboration

Stages in the movement from a design idea to a full LCA


• In the prioritization phase, the remaining alternatives are ranked in terms of technical, economic and environmental merit. The range of options available is likely to be still too large to apply the full LCA methodology, but environmental ‘life-cycle thinking’ can be applied to produce an assessment of environmental potential. This process can be semi-quantitative, based around the use of available specific data within a hazard matrix of environmental effects such as energy consumption, air or water contamination, resource consumption and so on that relate directly to full LCA. • The elaboration phase requires the design to have progressed to activities such as ‘scale-up’ of laboratory trials. At this stage, the main LCA rules apply and a strict functional unit, goal and scope for the LCA and site-specific data for the product as it would appear in the market are defined. Some aspects of the designs may still be uncertain. They must be identified before finalising the goal and scope of the LCAs and the key variables included as scenarios within the assessment. For example, if the length of service life is uncertain, then a range of periods should be assessed for the significance of additional replacements being required. The incremental LCA procedure encompasses the design process from a concept to a market-ready product. In redesign, where the application of the product and possibly large parts of its production and life-cycle are already known and fixed, it was found possible in the project to omit the first phase of the incremental LCA process and commence directly with the activities of the prioritization phase. In addition to the outcomes of the case-studies and development of the concept of incremental LCA, there are important implications for the implementation of LCA methodology to engineered timber products from this research. These include issues in the correct setting of system boundaries, end-of-life modelling and by- and co-product allocation. Several of the options for managing such issues when researching wood-based materials have been debated within the EC COST Action E9 ‘LCA for Forestry and Forest Products’, where elements of this work have been reported and discussed (Hillier, 2001). Thorough and effective application of the procedures developed in this project will help ensure that LCA can be commenced at the optimum time and completed as early and efficiently as possible in the design process for engineered timber products. The completed LCAs will also provide a sound basis for application in ecolabels, environmental product declarations (EPDs) and support environmental management systems.


Conclusions Timber is a sustainable resource with widespread applications. This study has demonstrated that a whole life-cycle perspective can be a valuable adjunct to technical and economic development advances in engineered timber products. The general benefits of timber as relatively low-impact material for a variety of engineering applications have been exemplified in the case-studies. The issues of energy and/or fuel consumption in the manufacture and use of all products has been particularly well demonstrated in the Morgan case-study (it is also applicable to insulation issues in building construction). The climate change benefit in using wood material was strikingly and unusually demonstrated in the design ‘improvement’ of OSB where the lower density giving lower transport emissions was still not sufficient to overcome the climate change benefit arising from carbon sequestration in the wood product. The research has provided a new concept of incremental LCA which will be employed in future research projects and also disseminated to industry and LCA practitioners. These LCD advances will surely benefit the UK forestry, construction and engineering industries and raise the profile of engineered timber products.

Acknowledgements The authors are grateful to the Engineering and Physical Sciences Research Council for funding this research under grant reference numbers GR/L74965/01 (University of Bath) and GR/L74996/01 (Imperial College). They acknowledge the support of Mr C. Morgan, Managing Director of the Morgan Motor Company Ltd, and Mr D.I. Flett of Nexfor Ltd (Inverness). They also acknowledge the vital contributions to the research of Professor A.J. Medland (Co-investigator) and Mr C.J. McPherson (Research Officer) of the Department of Mechanical Engineering, University of Bath, Ms K. Spong (Research Assistant) of the Department of Biological Sciences, Imperial College London and Dr Takuya Nishimura (Research Assistant) of the Department of Engineering and Applied Science, University of Bath.

References De Castro, J.F.M. (1992) ‘Energiekentallen in relatie tot Preventie en Hergebruik van Afvalstromen, deelrapport: houtproducten’, Nationaal Onderzoekprogramma Hergebruik van Afvalstoffen, the Netherlands.

Martin P. Ansell, Richard J. Murphy and Bill Hillier 231 Hillier, W. (2001) ‘Conclusions for the implementation of Land Use into LCA’, COST Action E9 LCA on Forestry and Forest Products, Proceedings of the Final Conference, November/December, Hamburg. Hillier, W. and Murphy, R.J. (2000) ‘Life-cycle assessment of forest products – a good story to tell’, Journal of the Institute of Wood Science, 15(4), 221–32. Medland, A.J. and McPherson, C.J. (2001) ‘Design for minimal environmental impact – a philosophy and an outline methodology for life-cycle design’, Seventh International Conference on Concurrent Enterprising, ICE, Bremen. Nishimura, T. and Ansell, M.P. (2000a) ‘Monitoring fibre orientation in OSB during production using filtered image analysis’, Proceedings of Sixth World Conference on Timber Engineering, Whistler, British Columbia, 31 July to 3 August, paper no. P54. Nishimura, T. and Ansell, M.P. (2000b) ‘Monitoring fibre orientation in OSB during production using filtered image analysis’, Proceedings of the Fourth European Panel Products Symposium, Llandudno, October. Nishimura, T., Amin, J. and Ansell, M.P. (2001) ‘Image analysis of the shape and size of strands in model OSB panels and correlation with MOE and MOR’, Proceedings of the Fifth European Panel Products Symposium, Llandudno, 10–12 October, pp. 155–66. Nishimura, T. and Ansell, M.P. (2002a) ‘The relationship between the arrangement of wood strands at the surface of OSB and the modulus of rupture determined by image analysis’, Wood Science and Technology, 35, 555–62. Nishimura, T. and Ansell, M.P. (2002b) ‘Monitoring fibre orientation in OSB during production using filtered image analysis’, Wood Science and Technology, 36(3), 229–39. Nishimura, T. and Ansell, M.P. (2002c) ‘Fast Fourier Transform and filtered image analysis of fibre orientation in OSB’, Wood Science and Technology, 36(4), 287–307. Nishimura, T., Ansell, M.P. and Ando, N. (2002) ‘Evaluation of the arrangement of wood strands at the surface of OSB by image analysis’, Wood Science and Technology, 36(1), 93–9. Nishimura, T., Amin, J. and Ansell, M.P. (2003) ‘Image analysis and bending properties of model OSB panels as a function of strand distribution, shape and size’, accepted for publication in Wood Science and Technology. (Forthcoming). Spong, K., Murphy R.J., Hillier, W., McPherson, C.J., Medland, A.J. and Ansell, M.P. (1999) ‘Life-cycle assessment for the ash frame of the Morgan car’, in SETAC-Europe (ed.), Proceedings of the Seventh LCA Case Studies Symposium, 2 December, Brussels. Brussels, SETAC-Europe.


Part V Managing the Environment


10 A Car in Three Days! Environmental Impacts of the Automotive Supply Chain Joe Miemczyk

Summary This chapter discusses the trend in the automotive industry to reduce lead-times and build to customer orders, and how this may impact on the environmental aspects of the automotive supply chain. It argues that more responsive operations and supply chain processes can have a negative impact on the environment, owing to current operations strategies. The main areas of concern are vehicle delivery, car body painting, component delivery and high-risk supplier processes. The chapter goes on to describe how mitigating factors can reduce these impacts and can have a positive impact on operations’ costs. This trend of responsiveness is common across many industries and unless mitigating factors are introduced collaboratively and early on across the value chain, the impacts on society may be considerable.

Introduction The concept of responsiveness in manufacturing, although not new, is beginning to influence whole industries in search of this goal. This is seen as crucial to the success of e-commerce initiatives where the ability to react quickly is essential. These efforts have led to changes in manufacturing and distribution strategies and influence companies across whole supply chains. Well-known examples of responsiveness exist in the personal computer, apparel, photography and optical eyewear industries. Dell Computer is often cited as a clear example of how manufacturing strategy (and so 235

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operations) was designed to be more responsive to customers. Dell does not subscribe to central manufacturing for stock, but instead late configuration of PC hardware modules to customer orders (Magretta, 1998). The benefits of responsiveness through build-to-order, and not fulfilment from distribution network finished goods, are seen as a reduction in inventory costs, lower obsolescence, improved knowledge of the market-place, reduced opportunity costs from discounting and better responsiveness to changing customer needs (ICDP, 2000). A crucial requirement of these developments is that of speed. If orders are not fulfilled quickly enough then customers may buy from stocks elsewhere. Thus any responsive build-to-order system must be quick enough to satisfy impatient customers. Industries, such as automobiles, have introduced targets for customer fulfilment in relation to the time it takes to fulfil orders. As a result of large finished inventory stocks and slow build-to-order lead-times (often around 30–40 days in Europe for both) many companies have set themselves targets to reduce these lead-times. Renault, Ford, Volvo, Nissan and, BMW have all issued statements that they intend to cut order-to-delivery times to less than two weeks in most cases (Automotive-World, 2001). These initiatives and the general trend toward short-lead-time, build-to-order strategies led to the development of the 3DayCar Programme based in the UK. This research programme studies the feasibility of producing a built-to-order vehicle and delivering it to a customer in the home market in only three days. This is a significant challenge for the auto industry, which is aiming at two weeks, but a demanding target is thought to highlight many of the problems involved. A key aspect of looking at responsiveness is taking a whole-systems view. Without looking at the whole manufacturing system, the process of optimizing parts of the system at the expense of the whole system can occur. This is the case in the automotive vehicle supply system where assembly plants, and to an extent suppliers, have been optimized through lean manufacturing techniques and yet the whole system does not deliver exactly the products customers want, when they want them. A key aspect of taking a systems view, though, is that industrial systems are typically open systems affected by agents outside the typical boundary of industry. Legislators, shareholders, community groups and other industries will often have an impact on firms in a system. A systems view therefore should consider this effect of environmental pressure on operations (Sarkis, 2001). In particular, the influence of the environment on the automotive sector is an important one. The environment

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(in the form of green issues) affects the types of products manufactured by impacting on their fuel and engine type, their vehicle weight, their recyclability and also the processes by which they are produced, for example limiting emissions from vehicle painting plants. This chapter examines the trend toward manufacturing responsiveness through build-to-order and how the influence of the natural environment interacts with this trend. The research programme was initially set up as part of the UK Engineering and Physical Science Research Council research area under the theme of ‘Innovative Manufacturing Initiative/Land Transport’. The primary sponsor base was from industry, with car companies, suppliers, logistics firms and other service providers included in the interested parties. Although the natural environment is often not a top priority with many of these companies, it was felt during the project specification stage that the car industry has often been criticized because of its environmental aspects. Thus any project intended to change the way the industry operates should consider how this affects the environment. The research team comprises primarily of manufacturing and operations experts, car distribution and marketing experts and researchers from the International Motor Vehicle Programme (IMVP) which is famous for the book The Machine That Changed The World. IMVP had in fact organized environmental research in the automotive sector. This related to assembly plant performance and actions in the supply base, and formed a theoretical basis for this study. The challenge here was to predict how industrial environmental performance might change. However this was only in generic terms, and so the specific applications like life-cycle assessment would not be possible. Also the huge range of operations potentially affected by a three-day car make an overall model of the ‘environmental’ system very difficult. The research needed to focus on key areas of concern and those most likely to be affected by a three-day car strategy. The research design attempted to address these issues.

Review of main contributions so far Build-to-order (BTO) is held up as a new target for manufacturing industry (Holweg and Pil, 2001). It should be noted that this follows a long history of operations and distribution initiatives such as quick response (QR), efficient consumer response (ECR), time-based competition, supply chain management, just-in-time (JIT), agility and lean thinking. Buildto-order can be seen as a synthesis of these operational strategies, taking aspects of each. Attributes of these initiatives include the customer


focus of QR and ECR (Wood, 1993; Suri, 1999; Hunter, 1990), the time emphasis of time-based competition, JIT and lean (Stalk and Hout, 1990; Womack et al., 1990; Harrison, 1992; Womack and Jones, 1996). Other aspects include the integrated and collaborative processes of SCM (Christopher, 1992) and the flexibility notions of agility (Kidd, 1994; Duguay et al., 1997). All these attributes facilitate build-to-order and are inclusive to it. As such BTO is not a new manufacturing fad, but an overarching goal which can allow value to flow efficiently between all stakeholders from mineral processors to consumers.

What are the effects of build-to-order? Improvements in the areas described may all contribute to build-toorder capability, and describing these improvements gives insights into how build-to-order initiatives can impact on operations. Lean manufacturing is generally related to lower inventories, just-in-time production and delivery, and to an extent flexible manufacturing facilitated by shorter setup times and thus cycle times (Womack et al., 1990; Womack and Jones, 1996). The agile plant can also mean flexibility in the workforce as well as the organizational structure and production technologies utilized (Duguay et al., 1997). Agility has become associated with less vertical integration and more reliance on flexible contracts and networks (Kidd, 1994). SCM and JIT improvements relate to better coordination and reduced order lead-times. Finally, QR and ECR ideas lead to links to real-time demand and efficient inventory management (Kurt Salmon Associates, 1993; Suri, 1999). Taking these points and applying them to vehicle manufacturing, it is clear that build-to-order means avoiding finished inventory and delivering custom-ordered cars in a timeframe acceptable to the customer. With these concepts in mind, the development of a three-day car scenario is possible. In this case the delivery to the customer in the home market is feasibly one day, leaving two days for the order to be received, processed and the car manufactured. Vehicle assembly is typically less than one day, leaving around one and a half days to receive an order, schedule it into production and inform suppliers of the requirements for that vehicle and start fulfilling the order. Building cars only to customer order requires flexible capacity when demand is not stable, processes such as the paint shop need to produce to orders and not just optimal batch sizes and line balancing sequences need to be modified to account for multiple combinations. The supply chain implications are similar, in that capacity and production requires flexibility. Ultimately, to not increase inventory levels in the supply chain, batch sizes

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may be reduced and the frequency of delivery increased in order for demand to be matched by the production of parts and components.

How does automotive manufacturing affect the environment? In examining the impact of a three-day car in the automotive sector it is clear that there are implications for both manufacturing and logistics operations. There is also no doubt that manufacturing causes environmental impacts and is subject to pressures as a result of environmental issues (Gupta, 1995; Sarkis, 2001). Every stage of manufacturing has some environmental implication: for example the painting of cars releases emissions into the atmosphere and produces solvent wastes and paint sludges which are difficult to dispose of (Geffen and Rothenberg, 2000). Firms can have different approaches to dealing with this which can depend on whether they are proactive or defensive or whether they can be considered advanced in manufacturing or less advanced (Florida, 1996).

Advanced manufacturing and distribution and the environment Much research to date has drawn a positive link between advanced manufacturing and reduced environmental impacts (Klassen and Whybark, 1999; Geffen and Rothenberg, 2000; Goldsby and Stank, 2000; Kitazawa and Sarkis, 2000; Florida, 1996). This is clearest between activities such as total quality management (TQM) and waste reduction and prevention (Willig, 1995). Links have also been drawn between ISO 14001 (an environmental management standard) and continuous source reduction (Kitazawa and Sarkis, 2000), lean principles generally and lower waste levels (Florida, 1996; Maxwell et al., 1997; Rothenberg, 1999), closer supplier coordination and reduced paintshop impacts (Geffen and Rothenberg, 2000) and supplier environmental quality improvement (Florida, 1996; Helper et al., 1997a; Helper et al., 1997b). There is less evidence that advanced logistics operations can lead to lower environmental impacts, however, and logistics managers appear to take a defensive stance to environmental pressure (Murphy et al., 1996). It has been reported that JIT may adversely effect environmental performance because of lower transport utilization (Baum, 1994; Werkgroup-2000, 1993) and issues such as home delivery are still unresolved as to their possible implications (Cairns, 1998). World-class logistics practices have been compared with environmentally responsible logistics (where the presence of recycling activities and environmental awareness as well as other measures indicates a higher level of performance). Goldsby and Stank (2000) found correlations only between performance measurement systems, positioning (strategic and structural


approaches) and environmentally responsible logistics. In fact no relations were found between integration and agile characteristics, which are attributes of advanced logistics operations. From this discussion of advanced manufacturing and logistics operations and the implications for the environment it can be said that many questions still arise over how these activities sit together. With regard to the impact of greater responsiveness in the automotive industry and in particular the implementation of a three-day car scenario, a number of questions need to be addressed, as follows:

• What is the impact of greater responsiveness in the automotive industry?

• What is the impact on the environment of reducing vehicle BTO lead-times and running stockless distribution systems?

• How might reduced lead-times affect in-bound and outbound operations of vehicle manufacturers?

• What impact could more flexibility have on vehicle manufacturing operations, for example the paint plant?

• What impact might shorter production schedules and more flexibility have on supplier operations? These are clearly broad questions, requiring a diverse research approach. As suggested earlier, these are open systems subject to many variables difficult to measure and control, and thus experiment and simulation approaches may be misleading unless carefully targeted. A case-study at the industry level employing a number of techniques is likely to be fruitful and is discussed next.

Research methods The research took the form of a multi-method, multi-stage process which is appropriate for case-study work where multiple perspectives might be necessary (Yin, 1993). The use of the exploratory case is intended to generate more questions to develop theory, and the identification of variables and measures is an important output of this process (Voss et al., 2002). The first stage consisted of a series of semi-structured interviews with the firms shown in Figure 10.1. In the 14 organizations studied, interviews of 1–2 hours each were undertaken and in some cases more than one interview took place, depending on the personnel available and who held the relevant operations expertise. In most cases

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First tier supplier

Inbound logistics

Assembly plant

Outbound logistics

3 firms

3 firms

5 plants

2 firms

Figure 10.1

Dealerships 1 group

Scope of the research in the automotive supply chain

it was the environmental manager who was interviewed initially (or where this function was not present an operations manager). In some cases supplementary information was gained from specific operations personnel, such as logistics or paint shop managers. 22 interviews were carried out for this stage. The next stage of the research involved a workshop held for industry and academic experts to understand the impact of a build-to-order vehicle in a short lead-time. A number of academic institutions (3), supplier companies (1), vehicle manufacturers (2) and logistics service providers (2) were present. The key findings on the first round of interviews were presented at this workshop. The workshop participants were then asked to suggest their views on which parts of the supply chain would be affected and the types of impacts possible in order to validate the previous findings. Owing to the variability in the processes found in the supply chain, upstream from vehicle assembly it was decided to add supplementary questions to a questionnaire sent to 17 automotive suppliers which varied from first- and second-tier suppliers. The sample was theoretically chosen on the basis of component type so that a range of types were included to account for a number of automotive supplier processes. The aim of these questions was to provide information on the types of processes which had the most significant environmental impacts and which were likely to be affected by the three-day car proposition. The next stage included quantitative modelling of the main processes perceived as having the largest impact in the workshops (new car delivery, vehicle painting and inbound delivery). These methods are described in more detail in other papers (Miemczyk and Holweg, 2001; Gregory et al., 2002; Holweg and Miemczyk, 2002). The final stage of the research involved a streamlined Delphi survey of 10 industry experts, drawn from consultants and vehicle manufacturers. Once all the supply chain processes which could be affected by a threeday car were identified, a list of them was drawn up and the panel of experts were asked to rank them in order of environmental importance. This ranked list averaged across the respondents was then used against a potential three-day car impact score to produce an aggregate score of impact.


Data analysis Detailed notes were produced from all the site visits, face-to-face interviews and telephone interviews. Over 180 pages of interview transcripts were produced in the first stage. To make sense of all this data, themes were drawn from the data and the notes were sorted using a matrix format according to the responses made in particular themes. The vertical side of the matrix comprised the research themes and the horizontal side was used to place the company interviewed. The themes emerging from the field work are shown in Table 10.1. The questionnaire findings were used to supplement the data in the research theme analysis, and notes and comments were added on the basis of this source of information. This particularly related to the themes of operational activities and type and level of impacts. The results of modelling were used to compare the impacts in the current state with the implementation of a three-day car in the UK. These results were further validated at a number of industry conferences in 2000 and 2001. The Delphi results were presented in a final report ranking the impacts by importance.

The impact of the three-day car This discussion section reports the primary findings of the field research supplemented by the questionnaire data and summarizes the key conclusions of the modelling exercises. The section deals one by

Table 10.1

Key ‘emergent’ themes used in the industry interviews

Key research theme Company environmental policy and strategy Corporate proactivity Description of operational activities Type and level of environmental impacts Pollution prevention or end-of-pipe solutions Predicted impact of responsiveness * Impact of increased flexibility * Impacts of reduced lead-times * Impacts of altered inventory policy Role of operations in environmental initiatives Role of logistics in environmental initiatives *Sub-theme.

Company response

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one with the parts of the supply chain, from distribution back to supply, as a convenient way of presenting the data, but the impact of responsiveness can affect a complete supply chain and so the findings should be viewed within this overall context. An assessment of the impact of responsiveness on each area is given at the end of the subsections.

Distribution The distribution of vehicles after manufacturing typically follows a number of routes. First, many are destined for a distribution centre where the car will wait for a customer order or be taken by a dealer for stock or as a demonstrator. Second, the car will be delivered straight to a dealership for stock, and third around 32 per cent of cars go directly to a dealership to be collected by a customer who ordered the car in the UK. Typically it physically takes 3–4 days for a car to reach a customer once it has left the factory. This is due to logistics operations needing time to build economic loads on their trucks. The pressure on cost reduction has driven economies of scale in that the vehicle fleets are predisposed toward large delivery batches. The transit time is further restricted by the opening times of dealers, so a specific delivery window normally needs to be met. The primary impact of BTO and specifically a three-day order-todelivery lead-time is that the normal 3–4 day delivery time must be cut. This has an impact on delivery logistics operations which would not have the time to plan loads and would need to deliver as soon as possible. Full loads could not be created and transport capacity not utilized to the full. A dealer in the UK normally sells about one car per day. Thus transporters could only deliver one car per dealer per day. For delivery trucks holding 11–12 cars this means visiting 11–12 dealers fully utilize the load and thus trucks would travel further to reach these extra dealers. Suppliers

Inbound logistics

Figure 10.2

Body and paint

Final assembly end of line

Physical distribution

Main processes of the auto supply chain

Dealers


Vehicle distribution companies are primarily transport contractors who have taken extra responsibilities including pre-delivery inspections and vehicle remarketing, but tend to take a typical transportation sector view on environmental responsibility which is normally defensive in nature (Murphy et al., 1996). In the firms in the study none had a specific environmental strategy, although one was anticipating implementing ISO 14001 in response to demands from its parent company. The main driver to reducing impacts was cost, since using less fuel reduces operating costs. The environmental impact of a three-day car is due to the longer distances covered by car transporters. This is estimated to increase by 30 per cent for a one-day delivery system. Modelling of the distribution systems found that an average of 100 transporter kilometres were covered per car delivered. The one-day delivery scenario was found to increase this to 130 kilometres per car. This clearly increases costs as well as impacts such as fossil fuel use, CO 2 production, emissions of NOx, SO x, CO, particulates and hydrocarbons. This impact was ranked as the most important impact of three-day car implementation.

Vehicle assembly The assembly of motor vehicles is a three-stage process comprising body assembly, body painting and final assembly where systems and components are added such as seats, engine and transmission. The sequence of vehicles sent through this process is set weeks before and depends on the orders received, the best mix considering supply and labour constraints and optimal batch sizes in the body and paint shops and final assembly. The lead-time is normally around one day for this process from start to finish. The final assembly process takes seven to eight hours. The actual type and number of cars proceeding through assembly also depends on the need for volume throughput to maximize capacity. Thus, if there are fewer customer-ordered cars, extra cars will be included in the schedule to fill capacity which then become stock vehicles sent to distribution centres or dealers awaiting customers to buy them. In the three-day car scenario only sold vehicles are assembled (with only a small percentage extra built as showroom demonstrators). This means that volume could be lower than capacity if fewer orders arrive at the factory than are forecast. The mix of product must only be those sold and so, for example, the paint batches must reflect this. Any mix of vehicle may also be sequenced in final assembly and so labour constraints due to high-value-content vehicles need to be resolved.

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Car plants are typically lean in all respects, which includes the management of environmental wastes. It was anticipated by respondents that impacts would be low. All the vehicle assemblers in the study had both environmental policies and strategies and considerable resources dedicated to resolving conflicts between company objectives and environmental demands. Operations had a role to play in reducing impacts, but as is commonly found elsewhere there was a dichotomy between the environmental department and production management (Florida, 1996; Helper et al., 1997b). One area of concern was the paintshop. Where batches of paint are optimized to reduce changeover wastes (solvent purging of paint lines), a reduction of batch size could increase this impact. Environmental reporting indicates that vehicle painting accounts for around 5 kg of solvent released per vehicle painted. Initial research shows that purging wastes could increase by three times if paint batches were reduced from the average 12 to 4. Volatile organic compounds produced by solvent releases are thought to be related to respiratory disorders and so are of significant concern for regulators of industrial processes. There is some indication that ‘lean’ practices of small paint batches can lead to greater emissions (Rothenberg, 1999), but it must be noted that regulation of their release is less stringent in Japan than in the US, which could account for a difference in approach in ‘lean’ plants such as Japanese transplants (Maxwell et al., 1997). This hypothesis has yet to be tested in academic research.

Material and component supply The automotive supply chain is a much researched area. A large proportion of the supply relations literature is based here (Sako, 1990; Lamming, 1993; Dyer, 1996; Fine, 1997), as is the operations management and logistics literature (Harrison, 1992; Jina, 1996; Aquilon, 1997; Hoek, 1998; Gonzalez-Benito and Spring, 2000; Svensson, 2000; Doran, 2001; Hertz et al., 2001). Research examining supply chain and environmental issues tends to concentrate on the drivers for action in the supply chain (Lamming et al., 1996) and practical techniques for approaching environmental issues (Faruk et al., 2002). There is some limited research on the types of impacts found in automotive supply chains (Helper et al., 1997a,b; Kincaid et al., 2000). The main operations and logistics activities in the automotive supply chain consist of transformation of materials such as steels, plastics and textiles into products and components which are combined as systems and modules. This makes for a very complex supply system with upwards of 3000–4000 individual parts from 300–600 suppliers in many


cases. Examining every stage at every supplier was beyond the resources of this project. Combining products into groups with similar characteristics allowed selective sampling of firms with different processes and different supply characteristics.

Inbound logistics implications The research showed that inbound logistics operators generally considered the environment as a low priority and so did not have environmental strategy in place. One firm was implementing ISO 14001 but this only considered site operations and not their main activity, transportation. The main activities of these operators in the automotive supply chain under study was the collection of components from suppliers, consolidating loads where needed and delivering into assembly plants. JIT operations were frequently used where collection was often on a multi-daily basis. This required the use of milkruns to make collections more economically viable, but the average vehicle utilization was less than 80 per cent. The main impacts of this operation was the transportation of goods using heavy goods vehicles normally of the order of 40 tonnes. There was some transportation of hazardous materials such as batteries containing acid, but these were well controlled. As the impact of fuel use and emissions is closely related to costs, actions to reduce fuel use were commonly in place. Drivers received training and routes were planned to minimize distances and therefore time and fuel. The drive to smaller collection quantities and more frequent collections however put pressure on this objective. In this sense the logistics and operations personnel were very much involved in reducing impacts in order to reduce costs, but investment in new low-emission technology was again subject to the normal vehicle renewal cycle (replacement being every few years). The component questionnaire revealed that similar distances were covered by trucks delivering to supplier plants. The expert panel again suggested that logistics impacts of greater frequency would be a likely result of implementing a three-day car. Modelling the comprehensive impacts of a three-day car on the automotive supply chain, including all first-tier suppliers, was not possible owing to the complexities of the potential simulation requirements. An assumption was then made as to possible implications such as an increase in delivery frequency. To understand this impact a model was used which calculated the impact of all UK suppliers to one plant going to at least daily delivery. This showed that in this case the transport distances per car produced at the factory would increase by 85 per cent (Miemczyk and Holweg, 2002).

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Supplier operations implications Automotive suppliers in the UK are subject to many environmental pressures from their many customers and from regulations. The requirement from customers such as Ford, MG, Rover and Honda to achieve ISO 14001 has led to most suppliers developing a policy and some sort of environmental strategy. The activities with environmental aspects are wide-ranging, with some suppliers having relatively few impacts, for example component assemblers, to those with large impacts, for example metal-plating firms. This diversity makes a generalizable approach problematic, so a framework for assessing the impact of responsiveness was therefore the best option. The key aspects of such a framework were as follows: energy and resource intensity, pollution severity, pollution quantity, batch process economies of scale, changeover/setup wastes, inventory buffer policy, impact reduction strategy (prevention or end-of-pipe). By assessing the aspects shown in Figure 10.3 it may be possible to understand how increased responsiveness could impact on the environment. These elements were derived from interviews with suppliers on their production processes. Helper et al. (1997a) argue that if a supplier process represents a high risk and is strategically important to the supplier then a high degree of action should be taken to reduce these impacts. Hence, when assessing the impact of responsiveness, it is suggested here that if a firm has a high environmental risk process which is subject to high demand

Supplier environmental criticality Resource Intensity Pollution severity Pollution magnitude Prevention or end-of-pipe Low-impact responsiveness Operations deployment Batch economies Inventory buffers Changeover waste/cost

Figure 10.3

Key issues for suppliers implementing low-impact responsiveness


variability (potentially greater if BTO is implemented), then an integrated approach to resolving the issue should be considered. This could include close working arrangements between operations and environmental departments through pollution prevention practices.

Mitigating the impacts of responsive supply chains New technology is clearly able to solve many of the problems highlighted in the study so far. These technologies include low-emission goods vehicles and water or powder-based paint applications. Cost pressures mean that investment is driven by regulation imperatives and if these do not exist then investment may be slow in coming; for example one plant planned to upgrade its paintshop when new EU regulations are in force in 2007. Other actions, though, could resolve these issues if the industry can combine operations know-how and environmental savvy to reduce impacts at the same time as operations costs. This combination of capabilities in manufacturing operations is commonly found where pollution prevention, TQEM or source reduction practices have taken place, where impacts and costs have both been reduced. The important aspect of this approach is to concentrate on those resources that may be viewed as tacit rather than explicit. Figure 10.4 depicts how these practices could be allocated to deal with greater responsiveness. Following this there are some suggested examples of how this approach might reduce the impact of a three-day car.

Distribution In combining the operational know-how of the vehicle logistics companies (their knowledge of congestion hotspots), the delivery requirements of ordered vehicles from vehicle manufacturers and the delivery constraints of dealerships quicker information transfer can reduce impacts. This is a result of more planning time to build economic loads for delivery. If franchises work together economies of scale can be built between manufacturers, again reducing the impacts of delivery. Having cost transparency and longer-term relationships common in lean manufacturing could also enable greater investment in low emission trucks, reducing the impacts further still. These are all operational measures which could reduce impacts. Modelling delivery scenarios confirmed that these measures would reduce impacts to better than the current state.

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Final assembly

Vehicle body painting

Seat assembly

Colour-coded bumper coating

Responsiveness

High

Low

Trim fasteners

Steel blank electroplating

Low

High Environmental risk

Figure 10.4 Positioning of processes according to environmental risk and responsiveness requirements

Vehicle painting The research suggested that painting individual cars to customer order would require a reduced colour-batch size and so more changeover wastes. New paint technologies are being implemented on a continuous basis to resolve the conflict between regulations and operational requirements. Such technologies include paints that are water-based, powder-based and slurry-based. Vehicles such as the MCC Smart use in-mould coloured panels, reducing the need for a complex paint facility and thus the production of changeover wastes from paint line purging. Decoupling paint from order-driven production may also allow larger paint batches to be maintained if a large coloured body buffer store is used. All these solutions require large capital investments which would delay immediate mitigation actions. Previous research has shown that working with suppliers can be of benefit in finding the right solution in terms of cost and reduced environmental impact (Geffen and Rothenberg, 2000), and is seen as essential to tackling impacts in this area.

Inbound logistics and supplier impacts In some circumstances the implementation of a three-day car would lead to increased delivery frequency from suppliers and in turn an increase in the mileage travelled by heavy goods vehicles. New technologies are


able to significantly reduce the impact of fuel use and exhaust emissions, but would have no effect on congestion increases (although telematics could have a role to play here). To reduce this impact of congestion, as well as reducing cost, fuel use and exhaust emissions, the capacity utilization of trailers should be improved. This can be facilitated through the use of shared collection schemes. Many suppliers deliver to a number of customers from one site. If customers coordinated collections to coincide then greater order quantities could be delivered in one vehicle if a cross-dock system were used to split the loads prior to line-haul to separate assembly plants. This would greatly improve utilization and is a practice commonly found in the Japanese auto supply industry. Within the suppliers’ production operations themselves, the range of potential impacts is large. Therefore, as suggested in Figure 10.4, actions should be concentrated on high-responsiveness and high-risk suppliers and their processes. Technology solutions exist for many of the problems potentially arising such as low-energy coolant circulation for machining equipment or improvements in startup/shutdown reliability so that equipment can be turned off when demand is low. These measures inevitably involve extra costs, which the auto supply industry can ill afford. Operational measures may be more suitable in some cases, for example by analysing the impact of customer schedules on environmental efficiencies. Joint risk analysis of processes to ensure non-compliance does not risk supply continuity should be part of any increase in responsiveness requirements. Customer standards already restrict the types of materials used – for example phasing out hexavalent chromium from coatings – and should be extended to include production process parameters. This is increasingly important as processes are outsourced to countries where the local regulations on wastes and emissions are less stringent than in western Europe or the USA, for example in eastern Europe or northern African states.

Conclusions There are adverse impacts related to increased responsiveness of the automotive industry. The impacts are in the areas of vehicle and component logistics, vehicle painting and high-environmental-risk supplier operations. In comparison with the vehicle life-cycle these impacts may be small. For example the extra 30 transporter kilometres driven per car delivered in the UK equates to about 4 litres of fuel used. The average car over its useful life uses about 20 000 litres of fuel. There are technological solutions to resolve many of these impacts but these come at

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a financial cost. Operational solutions could reduce the costs of responsiveness while at the same time lowering environmental impacts, and collaborative efforts between customers, suppliers and service providers should be made to implement these where greater responsiveness is required.

Implications for practice Operations and environmental departments must work together to resolve problems and target these limited resources where the changes and risks are most prominent. These departments should also collaborate with their counterparts in the customer or supplier facilities to identify areas which could be improved jointly by modifying schedule or process requirements to reduce environmental risks. Managers should apply the model of responsiveness and environmental risk to supermarkets and other industry types and processes. Supermarket developments have seen an explosion of new practices such as home delivery and super-distribution centres; shared approaches as suggested for automobile supply chains would save logistics costs and congestion. How important is brand on delivery vehicles? Many vehicle manufacturers already share some transporters, but would fast-moving consumer goods retailers be able to do the same? Mass customization in home appliances is also a developing field, with multi-coloured fridges and washing machines becoming common. Would ‘colouring appliances to order’ have the same implications for this technology, for example in-mould colour versus coating processes?

Implications for theory The development of variables and measures is an important output of exploratory case-study. Two variables are discussed here, ‘responsive processes’ and ‘environmental risk’; linking them suggests targeted action to reduce the impact of advanced production and operations trends such as lean and agile. The key measures of responsiveness are related to three main areas: (1) order lead-times and demand (Is it stable and is there a Pareto curve?), (2) variety and complexity of the product and where it is customized, and finally (3) the process lead-time including orders, distribution and supply (Holweg, 2001). Where demand fluctuates, the product is complex and high-variety, and the lead-times are long actions may be needed to improve responsiveness. If the environmental risk is high then joint action may be required.


Where responsiveness already exists or is not required and risk is low then actions can be less urgent. Advanced manufacturing must not be seen in isolation. There is a need to look at whole industries from supply, through manufacturing, distribution and sales. The industrial ecology approach is mainly geographically based, but manufacturing operations are global systems, so the focus must be far wider in order to observe the real impacts of the new industrial landscape.

Towards an environmental research agenda This research study employed an interdisciplinary approach, taking findings from operations management, marketing management, transport and logistics fields, and environmental management. The programme also involved industrial partners where, to an extent, they were able to influence the research agenda themselves collaboratively with researchers. Of particular use in future will be links with political scientists to examine the legislative process and how it may encourage or discourage actions which benefit competitiveness and environmental performance together. Another area of potential is the link between environmental management and macroeconomics as it influences production networks. The increase in globalization has led to longer more geographically dispersed supply chains which can have an adverse impact both on responsiveness of production and on the environmental performance of these vast material flows. The whole field of operations and production management offers many opportunities for researchers from diverse backgrounds, and while changes continue to occur in the way consumers’ desires are fulfilled, those engaged on research into environmental implications have a social obligation to continue.

Acknowledgements The author would like to thank the EPSRC, funding through the Innovative Manufacturing Research Centre (Grant: GR/R6749/01) and the sponsors of the 3DayCar Programme, a study of the UK automotive supply chain. The objective was to develop a framework, which allows for vehicles to be built to customer order in minimal lead-times. It was a collaborative programme between the University of Bath, Cardiff University and the International Car Distribution Programme. Further information on the 3DayCar Programme can be found at www.3daycar.com.

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References Aquilon, M. (1997) ‘Cultural dimensions in logistics management: a case-study from the European automotive industry’, Supply Chain Management: An International Journal, 2(2), 76–87. Automotive-World (2001) Build-to-order, just-auto.com., available at: www.justauto.com/features (accessed January 2001). Baum, H. (1994) Desynchronisation of economic growth and transport development in Europe, Working Paper. Cologne: University of Cologne. Cairns, S. (1998) Home Delivery: Environmental Solution or Disaster? Corby: Institute of Logistics. Christopher, M. (1992) Logistics and Supply Chain Management. Strategies for Reducing Costs and Improving Services (2nd edn). London: Prentice-Hall. Doran, D. (2001) ‘Synchronous supply: an automotive case-study’, European Business Review, 13(2), 114–20. Duguay, C.R., Landry, S. and Pasin, F. (1997) ‘From mass production to flexible/ agile production’, International Journal of Operations and Production Management, 17(12), 1–11. Dyer, J.H. (1996) ‘Specialized supplier networks as a source of competitive advantage: evidence from the auto industry’, Strategic Management Journal, 17(4), 271–91. Faruk, A.C., Lamming, R.C., Cousins, P.D. and Bowen, F. (2002) ‘Analyzing, mapping and managing environmental impacts along supply chains’, Journal of Industrial Ecology, 5(2), 13–36. Fine, C. (1997) ‘Power diffusion in automotive supply chains’, Working Paper, International Motor Vehicle Program, MIT. Cambridge, MA. Florida, R. (1996) ‘Lean and green: the move to environmentally conscious manufacturing’, California Management Review, 39(1), 80–105. Geffen, C. and Rothenberg, S. (2000) ‘Suppliers and the automotive painting process’, International Journal of Operations and Production Management, 20(2), 166–86. Goldsby, T.J. and Stank, T.P. (2000) ‘World class performance and environmentally responsible logistics practices’, Journal of Business Logistics, 21(2), 187–208. Gonzalez-Benito, J. and Spring, M. (2000) ‘JIT purchasing in the Spanish auto components industry: implementation patterns and perceived benefits’, International Journal of Operations and Production Management, 20(9), 1038–61. Gregory, J., Miemczyk, J. and Waller, B. (2002) ‘Resolving the distribution impacts of the 3DayCar’, Logistics and Transport Focus, 4(3), 49–54. Gupta, M.C. (1995) ‘Environmental management and its impact on the operations function’, International Journal of Operations and Production Management, 18(8), 44–51. Harrison, A. (1992) Just In Time in Perspective. London: Prentice-Hall. Helper, S., Allen, M., Clifford, P.G., Henderson, W., Hochfielder, D. and Rozwadowski, H. (1997a) Pollution Prevention Assistance in the Automotive Supply Chain. A Study of Northeast Ohio: 1–86. Cambridge, MA: International Motor Vehicle Programme. Helper, S., Clifford, P.G. and Rozwadowski, H. (1997b) ‘Can Lean Be Green?’ International Motor Vehicle Programme. Working Paper. Cambridge, MA. Hertz, S., Johansson, J.K. and Jager, F.D. (2001) ‘Customer-oriented cost cutting: process management at Volvo’, Supply Chain Management: An International Journal, 6(3), 128–41.

254 A Car in Three Days! Hoek, V.R. (1998) ‘Logistics and virtual integration: postponement, outsourcing and the flow of information’, International Journal of Physical Distribution and Logistics Management, 28(7), 508–23. Holweg, M. (2001) ‘Responsive order fulfilment-quantifying the key variables’, in Blackman, K., Brown, S., Cousin, P., Graves, A., Horland, C. and Lemming, R. Maylor (eds). Proceedings of the European Operations Management Association 8th International Annual Conference, Bath, 3–5 June, pp. 216–29. Holweg, M. and Miemczyk, J. (2002) ‘Logistics in the three-day car age’, International Journal of Physical Distribution and Logistics Management, 32(10), 829–50. Holweg, M. and Pil, F. (2001) ‘Successful build-to-order strategies start with the customer’, Sloan Management Review, 24(4), 74–83. Hunter, A. (1990) Quick Response in Apparel Manufacturing. Manchester: Textile Institute. International Car Distribution Programme. (ICDP) (2000) Fulfilling the Promise: Is There a Future for Franchised Car Distribution? Solihull. Jina, J. (1996) ‘Automated JIT based materials management for lot manufacture’, International Journal of Operations and Production Management, 16(3), 62–75. Kidd, P. (1994) Agile Manufacturing – Forging New Frontiers. Reading, MA: AddisonWesley. Kincaid, L.E., Geibig, J., Miller, M. and Sparks, J. (2000) ‘Life-cycle management in the automotive supply chain: results of a survey of Saturn tier-1 suppliers’, paper presented at the Total life-Cycle Conference, Detroit, Michigan. Kitazawa, S. and Sarkis, J. (2000) ‘The relationship between ISO 14001 and continuous source programs’, International Journal of Operations and Production Management, 20(2), 225–48. Klassen, R.D. and Whybark, D.C. (1999) ‘The impact of environmental technologies on manufacturing performance’, Academy of Management Journal, 42(6), 599–615. Kurt Salmon Associates (1993) Efficient Consumer Response. Washington, DC: Food Marketing Institute. Lamming, R.C. (1993) Beyond Partnership – Strategies for Innovation and Lean Supply. London: Prentice-Hall. Lamming, R.C., Warhurst, A. and Hampson, J. (eds) (1996) Purchasing and Environment: Problem or Opportunity? Stamford: Chartered Institute of Purchasing and Supply. Magretta, M. (1998) ‘Managing velocity’, Unesco Courier, December, pp. 26–8. Maxwell, J., Oye, K., Rothenberg, S., Briscoe, F. and Koike, A. (1997) Preliminary Report: Environmental Practice Survey Results. Cambridge, MA: International Motor Vehicle Programme. Miemczyk, J. and Holweg, M. (2001) ‘Logistics and the 3-day car – implications for inbound logistics’, paper presented at the Logistics Research Network, Edinburgh. Miemczyk, J. and Holweg, M. (2002) Building cars to customer order – what does it mean for inbound logistics operations? Submitted to the Journal of Business Logistics. In Review. Murphy, P.R., Poist, R.F. and Braunschweig, C.D. (1996) ‘Green logistics: comparative views of environmental progressives, moderates and conservatives’, Journal of Business Logistics, 17(1), 191–211. Rothenburg, S. (1999) ‘Is lean green? The relationship between manufacturing processes and environmental performance within varying regulatory environments’, unpublished PhD thesis, Massachusetts Institute of Technology.

Joe Miemczyk 255 Sako, M. (1990) Prices, Quality and Trust: Inter-firm relations in Britain and Japan. Cambridge University Press. Sarkis, J. (2001) ‘Manufacturing’s role in corporate environmental sustainability’, International Journal of Operations and Production Management, 21(5/6), 666–86. Stalk, G. and Hout, T. (1990) Competing Against Time: How Time Based Competition is Reshaping Global Markets. New York: Free Press. Suri, R. (1999) Quick Response Manufacturing. Portland, OR: Productivity Press. Svensson, G. (2000) ‘A conceptual framework for the analysis of vulnerability in supply chains’, International Journal of Physical Distribution and Logistics Management, 30(9), 731–49. Voss, C., Tsikriktsis, N. and Frohlich, M. (2002) ‘Case research in operations management’, International Journal of Operations and Production Management, 22(2), 195–219. Werkgroup-2000 (1993) A new course in freight transport. Amersfoort, Netherlands. Willig, J.T. (1995) Environmental TQM. New York: McGraw-Hill. Womack, J. and Jones, D.T. (1996) Lean Thinking: Banish Waste and Create Wealth for Your Corporation. New York: Simon and Schuster. Womack, J., Jones, D.T. and Roos, D. (1990) The Machine That Changed The World. New York: Rawson. Wood, A. (1993) ‘Efficient consumer response’, Logistics Information Management, 6(4), 102–31. Yin, R.K. (1993) Applications of Case-Study Research. Thousand Oaks, CA: Sage.

Further reading Fischer, K. and Schot, J. (eds) (1993) Environmental Strategies for Industry: International Perspectives on Research Needs and Policy Implications. Washington, DC: Island Press. Porter, M.E. (1991) ‘America’s green strategy’, Scientific American, 264(4), 168. Shrivastava, P. (1995) ‘Environmental technologies and competitive advantage’, Strategic Management Journal, 16, 183–200.

11 Paradox in Marketing: An Inquiry into Sustainability, Ethics and Marketing Carole Bond and Chris Seeley

Summary Marketing and sustainability are seen by some to be fundamentally incompatible because marketing is about selling more while sustainability is about consuming less. Given that marketing’s core role is to align what business produces with what the market wants, however, it is possible to consider a deeper level of engagement around the issues. A six-month cooperative inquiry research project, commissioned by the Chartered Institute of Marketing (CIM), worked with more than two hundred marketing, sustainability and ethics practitioners to investigate the links between the new ethical issues of environmental sustainability and corporate social responsibility (CSR) and the profession and practice of marketing. The outcomes of the research identified seven key paradoxes or challenges to the marketing profession concerning market theory and principles, reputation, trust and branding, planning, social and cause-related marketing, new product development and distribution, communications, and professional codes and development. The research concluded that marketing must frame its own response to issues of increasing social and environmental complexity and that this will, in turn, bring new stakeholder groups into the marketing field. Furthermore, if the marketing profession is not to be left behind by other mainstream management fields, it must both capitalize on the strengths of its current concepts and practices and be prepared to learn from the developing practice within corporate social responsibility and sustainability management in order to underpin both its position and its strategic response. The profession must show it can deal with uncertainty in the world and reinvent itself in order to take up its key role of 256

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linking business with its increasingly sustainable and ethical operating environment. Further interdisciplinary research opportunities exploring corporate governance, CSR, intangible brand value, reputation management, corporate reporting, media ethics, professional standards and education, and regional and international development are recommended to support these aspirations.

Introduction Ethical decision-making and socially responsible conduct are not new ideas for marketers, nor is care for the environment. Perhaps what is changing is that people, whom marketing serves, are themselves becoming more concerned with the behaviour of ‘others’ and the higher-order self-actualisation concerns, many of which are fundamental like human rights and organizational responsibilities. This discussion of rights for people and for the planet itself is now thirty years old – the foundation of Greenpeace for instance occurred in 1972 – and has arguably become part of a language of resistance uniting many against the very success of business and as such marketing. Marketing needs to reflect and address this thinking because it represents both critique and innovation in Western democratic globalized economies and a means of addressing the pressing concerns of the less-developed world. In the twenty-first century, marketing may possess just one certainty. The last hundred years have seen the success of a market-led philosophy and its practice through global business and institutions and yet it is part of something wider. The increasingly vocal ‘sustainability movement’ can be viewed as a response to marketing’s success, a response driven by people who have identified failures in market theory and business practice. Marketing can ignore this response only at a cost to the profession. Business is at the forefront of global change and marketing is at the forefront of business. The profession of marketing should be seen leading the response to new global realities and the ethical concerns that emerge from them, in doing so creating new opportunities to serve the wellbeing of companies and their stakeholders, marketing’s ultimate purpose. A six-month research project entitled ‘Paradox in Marketing’ was established in March 2001 in order to investigate the links between the new ethical issues of environmental sustainability and corporate social responsibility and the profession and practice of marketing. The research, subtitled ‘Sustainability, Ethics and Marketing’, was commissioned by the Chartered Institute of Marketing (CIM) in the United Kingdom

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following a year of negotiation and discussion concerning the relevance of sustainability for marketing. The research project team consisted of Carole Bond of Carbon Data Environmental Communications, Chris Seeley of Just Business Limited and Robert Beckett from the Institute of Communication Ethics.

Research methodology The purpose of the research was to identify the key issues and begin to develop a common understanding about relationships between the changing nature of marketing and the influence of emerging sustainability and ethical issues, both for industry and for the profession. Sustainability, ethics and marketing are not closely defined fields of practice where you refer to books and write up the answers. Marketers however are well versed in the art of working with complexity, and a paradoxical and reflective mindset is appropriate for creating coherence and building understanding in the dynamic marketing of the information age. The project team felt it was important to consult widely and to gather the views of both experts and practitioners across the fields of marketing, sustainability and corporate social responsibility. To ensure that the outcomes were practical rather than theoretical, a ‘cooperative inquiry’ approach was adopted. Cooperative inquiry is a form of ‘action research’, concerned with ‘revisioning’ our understanding of the world, as well as transforming practice within it. Unlike more conventional quantitative and qualitative research methodologies, action research seeks to generate new knowledge in a way that learns from individual and collective organized learning experience. In a cooperative inquiry group people who have similar concerns and interests work together to find creative ways of looking at things and to identify practical ways of doing things better.1 It is a participatory process where the key challenges are to open up the space for dialogue and then make sense of the discourse. As such, the boundaries between expert and learner, telling and experiencing, become blurred and the inquiry itself becomes as important a part of the process as the outcomes.

The inquiry process The inquiry was undertaken in three phases. The purpose of the first was to raise a few key questions and begin to develop a common understanding about relationships between the changing nature of marketing


and the influence of emerging ethical issues, both for industry and for the profession. The first phase took the form of a day-long inquiry workshop with an invited group of 19 individuals including marketing practitioners, academics and sustainability and ethics specialists. These participants generated a number of key questions. In the second phase these questions and the combined thoughts and comments generated by the first inquiry workshop participants were compiled and then circulated to a much wider group of more than 150 marketing practitioners, accompanied by a selection of questions which were designed to prompt responses and comments. This wider group had expressed an interest in becoming involved with the inquiry process following a focused advertising and regional direct-mail campaign to the CIM membership. Some of this wider group became virtual commentators – and their contributions were added to the initial document. Others, along with some of the attendees of the first workshop, formed the 57 attendees of the third phase inquiry workshop, which explored the emerging paradoxes further, building on the outcomes of the first two phases. Both workshops were recorded and notes of the transcriptions formed the basis of the research reports. Introductory presentations were also made in both workshops to provide food for thought and discussion. However the key emphasis of the whole process was participation and the generation of new knowledge. Two reports were generated from the Paradox in Marketing inquiry. First, the Inquiry Process and Outcomes Final Report was created as an account of the project process and structure itself and reproduced the dialogue that took place over the course of the three inquiry phases. The dialogue was unattributed, unedited and largely freeform, although the comments were grouped under topic areas – using the paradoxes that emerged throughout the process as a template. A second report entitled simply Paradox in Marketing – Sustainability, Ethics and Marketing built on this inquiry dialogue and explored the key issues raised, using existing and emerging marketing and business models, case-study material and learned references, to provide a more in-depth investigation and discussion of the principle paradox areas. The knowledge acquired through the project was assimilated into the Chartered Institute of Marketing under the banner of the ‘Canon of Knowledge’, a project that aims to bring together practical information for marketing professionals, using the internet as the key delivery medium. Elements of the second report in particular are held within the Canon of Knowledge as factfiles.


Seven paradoxes of marketing and sustainability Developing the paradoxes During the first inquiry phase workshop, session participants were provided with a provisional list of paradoxes for marketing – those tricky questions posed by new debates within the profession and society as a whole. Participants were requested to identify which if any of these they felt were important (or to add their own). From the very start, the inquiry participants challenged some of the key definitions of professional marketing and the economic theory that supports it, arguing that the drive to consumption and other traditional marketing objectives may no longer be appropriate to a new generation of resource, environment and socially conscious practitioners and consumers. Or as one participant commented, ‘The key is to remember the core issues of marketing, which are to listen and learn and lead, ask the right questions and find the right answers.’ The key questions which then emerged from the first phase were as follows:

• Is marketing part of the sustainability solution, and how does it work • • • • • • • •

with sustainable processes, particularly in an era of environmental meltdown? Can the profession of marketing take on board new ideas of sustainable business and develop a wider grasp of socio-ethical issues? Is marketing sustainable? Is reputation ever manageable, or are there now bigger issues that determine trust and reputation? Do new ideas for customer relationship management reflect the stakeholder debate on sustainability, and how may each inform the other? How do marketing and sustainability relate to new issues of intangible value? Where is the evidence that dematerialization (the product to service shift) will do anything but keep pace with increases in consumption? Education strategies in marketing utilize professional ethics, but do they know how to teach a less applied ethics of sustainability? The whole-earth ecology and philosophy and the understanding of the links there gives us a powerful driver to start integrating thinking on sustainability and how we deal with the issues of sustainability of marketing at a professional level.


During the second and third phases of the inquiry this list of questions evolved, taking into account the dialogue and ideas generated from both workshops plus the virtual feedback. It was finally distilled into the seven paradoxes or challenge areas, which are listed below and which are then explored individually in more detail in this section.

• Jam today or jam tomorrow? How can marketing contribute to a more • • • • • •

sustainable society, when its role is to create and meet the demands of consumerism? Can we have jam today and jam tomorrow? Value or values? Are the values in the minds of consumers as important as the values established within the brand itself? Beacons or reflections? Should marketers plan to build their business in sustainable and socially responsible ways, or should they wait until the market adopts such behaviour itself? Knee-jerks or leaps of faith? In an examination of social, green and cause-related marketing are ethical responses already framed by marketing? Can tactical marketing responses provide strategic solutions? Cakes or recipes? In the information-rich world, should marketers now be concentrating on shipping products or sharing expertise? Monologue vs. dialogue How can marketing truly listen to the voice of the market? Old school or new cool? Can the profession of marketing learn faster than the society it serves?

These issues present major challenges for the role of marketing and an opportunity for a timely response for individual marketers to consider what this means in their day-to-day work.

Jam today or jam tomorrow? Market theory, principles and function How does marketing contribute to a more sustainable society, when its role is to create and meet the demands of consumers? There has been a shift in the pace of change in UK corporate governance and wider regulatory activity in relation to reporting, directors’ duties and risk. These changes have been fast and far reaching. Boards are beginning to face integrated reputation and intangible management issues. The issues that have previously been addressed within marketing, such as relationships, are now addressed by the board, by general management or even by other management disciplines including new sustainability and CSR functional units in leading companies.


The language marketing needs to understand is that of human and professional concern – or ethics – a language that all organizations, whether for profit or public interest, need to speak as well as address. Ethics is also the language of professional responsibility and should be an intrinsic part of marketing management systems. The good news is that the ethics and sustainability movement has encouraged a language based on ethical concern, a language that marketing wittingly developed some time ago but may have unwittingly neglected, and that is now being spoken in the boardroom. The bad news is that marketing is often excluded from the conversation. The emerging global civil community criticizes global institutions and global business. It can be a powerful counterforce to certain aspects of business and market philosophy. The ethics and sustainability of business are a core concern to groups involved in civil action and consultation. As one inquiry participant commented: We need to . . . try to move away from the public image that sees marketing as being primarily concerned with promotional wizardry: forcing sales of outmoded or unnecessary products and services on unwilling and ill-informed consumers. This image of marketing is in direct conflict with the whole concept of sustainability and ethics. Businesses, like government, are seen as institutions derived from society and should therefore be held accountable by society, whether in a chaotic and informal sense through ‘direct action’, or more formally through active participation in systems of global governance and regulation, as well as national systems of business regulation. For example, a third of UK consumers claim to be seriously concerned about ethical issues when shopping – even if only half of that number currently put their principles into action and buy (or boycott) products because of the manufacturer’s reputation. Meanwhile investment by UK investors in socially responsible investment funds has risen from £791 million to £3.3 billion in the period 1996–2001. In response, business is knitting together a few simple techniques, using an overriding philosophy of care for people and the assessment of the wider impact of business on its environment. However, the unique properties of each organization will lead to unique responses that can be regenerated through partnership, network and communication effects. The whole is greater than the sum of the parts, as marketing has often repeated and has now become a by-phrase of the global sustainability movement.


Value or values? Reputation, trust and brands Is reputation or brand value ever manageable, or are there other issues that determine the trust on which they are based? Global business is undoubtedly a target for the criticism of newly enfranchised global citizens and reputation is the currency of this debate. Accusations include damage to the environment, human rights abuses or complicity in regimes that carry out abuses, poor labour conditions, unsafe testing of products, animal testing, lack of care for local communities, destruction of wildlife habitats, complicity in species extinction, supply of illegal arms and military sales to unfit regimes, even new product development such as genetically modified organizms, AIDS drugs and new scientific research. Under these conditions business is looking for ways to manage its corporate reputation. The problem for traditional PR approaches within the sustainability ethics debate is that even the most sensitively judged crisis management can have a long-term effect on reputation, reducing confidence, implying poor decision-making and affecting the long-term value of the business. Today’s PR management systems, although improving fast, appear unable to predict a crisis or to manage a reputation once a crisis occurs. Using the right language is key, and if your whole business doesn’t understand such language you may come unstuck in a very public way. There are examples of well-managed, values-led organizations that have fought back from adversity. Marks & Spencer took Granada Television to court over the implication that the store group had knowingly sourced products from a company that employed child labour. M&S won the case, not because there were no child workers involved in the production of their goods but because they were able to establish that the fact was unknown to them. Arguably, however, the context of global communications reduces the possibility of a fightback, particularly once reputation is damaged; witness the demise of Arthur Anderson following the Enron scandal. Reputation is particularly difficult to manage in the global age, across borders and cultures, with new ideas, arguments and sources of controversy rapidly emerging. Loyalty is also diminished as customers purchase from companies across the world. In the context of globalization, reputation can, it may be argued, be supported only by trust. Trust is earned and returned in reputation assets. Trust is actually what reputation management systems seek to build in order to sustain the


relationships on which the business is founded. Trust requires more considered, more ubiquitous and better constructed management, because a small thing can destroy so many others. Again this is where new models of CSR and sustainability aim to link business and stakeholders. The brand is the capitalized value of the trust between a consumer and the company. Most companies use sales as their primary measure. Yet, what will need to be measured in future are the number of customer relationships and the distribution curve of these relationship values. These will be the measures that reflect trust in the company. ‘The brand is the only means to creating this relationship with consumers, and this is what should be nurtured’ (Clancy and Wright, 1999). The reputation of brands is clearly dependent on trust, while the language of brand management often implies a consensus of values between company and customers when, as Naomi Klein suggests, little such consensus exists (Klein, 2000): Brand activism – that is coordinated actions against well-known brands – is a new values-based phenomenon especially in local and international environments where people’s views of brands can be quite negative. In one inquiry participant’s opinion: The reason why Nike has suffered over the Third World labour issue is not out of pure altruism on the part of consumers. Rather, it’s because people naturally think: ‘If this company is willing to cynically exploit other people in its quest for a quick buck, then it’s also likely to be the sort of company that is willing to cynically exploit me or my children in the same quest for a quick buck. Therefore, I can’t trust that company and I don’t approve of it.’ In response, brands need to develop a competency to address ethical and sustainable arguments. Brands need to build trust through brand relationships and manage risk within marketing. This shift is epitomised by changes in the attitude of leading companies towards a stakeholder centric corporate positioning. This is a shift from a ‘trust me’ culture, to a ‘show me’ (prove it or I’ll react) response and finally to an ethically sound ‘involve me’ request from stakeholders that should be difficult to ignore. The problem with sustainability and responsibility debates is that such arguments are complex, time-consuming and motivated by ethical ideas of fairness and legitimacy. For marketing with a short-term, profit-driven agenda, these are characteristics that are contradictory. For one inquiry participant this represents a key paradox for marketing:


If you consider brand value as a whole, based on current measures, most of the return comes from hard products and brand features, very little in the way of social, ethical or environmental returns. Investment in these ‘softer’ issues now could reap huge value in the longer term but that does not satisfy current short-term investment targets, and therein is the paradox.

Leading businesses are now setting up high-level committees to address difficult issues, committees that aim to be representative of democratic opinion and draw together groups of stakeholders rather than simply business managers. Connected to corporate governance, these committees need to be linked to marketing as the key management function for corporate relationships and communications. What is clear is that the opinions of the market and the customer can represent a clear danger to brand value. New trends, consumer attitudes and demands can jeopardise the book value of brands in incredibly short periods.

Beacons or reflections? Marketing planning, research and buyer behaviour Should marketers plan to build business in sustainable and socially responsible ways, or should they wait until the market adopts such behaviour itself? Market planning has moved from a traditional and prescribed set of applied rules to a more responsive and dynamic set of methods and analysis. Its role now includes a dynamic interpretation of business performance, operating environment and decision-making. Marketing assumptions should be open and be based on clear signals that all may understand, question and interpret. This translates to a ‘marketing mindset’ for the entire organization. The new quality for marketing focuses on a human-centred rather than a technical process, putting people, ideas and innovation at the heart of the planning process. One inquiry participant said, Let’s continue to serve societal and customer needs including latent needs. Sustainability is a latent need if ever there was one, so intuitively there must be market value for not just for making current business models more sustainable but for actually delivering sustainability itself! But are we smart enough to find that value?


Some leading business organizations have already developed sophisticated planning responses to manage their sustainability impacts. In some cases, sustainability strategies directly affect the entire industry. Clancy and Wright (1999) note: In the UK, the public reaction to genetically modified organizms (GMOs) has spurred food manufacturers and retailers to offer and promote organic produce. Companies like Doves Farm have suddenly catapulted to fame and almost immediately; supermarkets have developed their own label competitors. There is now a vibrant organic market throughout Europe, such that it is impacting the decision of Brazilian soya producers about their switch to GMO seeds. The sustainable nature of an industry is being reshaped positively. This is the key point about ethical issues, that they are widespread and complex and are the natural responsibility of professional strategic management. One of the difficulties of identifying these issues is that they often start with the smallest voices and individual perception (Drucker, 1993). This is why market research and planning will need to become sensitized to ethical and sustainability issues. Increasingly, focus groups and independently mediated stakeholder dialogues are linked into performance measurement systems, through integrated processes of sustainability reporting. However, more often than not, marketing is not represented in these debates, or the systems for their management. Market planning needs to be able to predict and respond to various issues likely to damage the reputation of the business and its brands, but also to identify new opportunities through these issues. In May 2001 the Co-operative Bank published a cost–benefit analysis that attributed up to 18 per cent of its profits to ethical policies while Iceland, the frozenfood retailer, was badly hit by its decision the previous year to sell only organically produced vegetables in its own-label range. It expected a 30 per cent rise in sales but found that customers bought less.

Knee-jerks or leaps of faith? Social, green and cause-related marketing Can tactical marketing responses provide strategic solutions? Without integration into the overall business, critics may condemn social marketing programmes because, despite high principles, they appear to be situated tactically and pragmatically rather than strategically and qualitatively. An inquiry participant posed the question:


Do consumers target ethical brands for purchase because the products represent values they aspire to but are not yet reality? For example I understand that the average Body Shop customer is an average Daily Mail reader. What can we conclude from this? Do Daily Mail readers enjoy the cache of progressive, ethical products so long as they are not directly challenged in the process? If this becomes the logical extent of cause-related marketing and the marketing of sustainability and ethics then it can only build apathy. I don’t have an answer but it would be good to have a think about this. In short, are we looking to market ethics or make marketing ethical?’ The speed of change in the field of marketing, much of it based on changing public expectations, may provide marketing with the opportunity to reclaim and re-examine the green, social and cause-related marketing models and reposition knowledge as part of the core analysis for marketing in a sustainable age. The trouble is that if market responses are not integrated into the overall business strategy, they are likely to be seen as part of the problem – that is a cover-up of more fundamental and non-resolved issues – than a solution in themselves. Recently, companies with excellent environmental records have been criticized for their human rights records or supply chain failures. For example, the Belgian manufacturer Ecover was an early example of green marketing, using biodegradable ingredients in an environmentally responsible manufacturing plant which receives thousands of visitors a year in its own right. Issues of waste (particularly at the palm oil plantations the company uses) have still been questioned in spite of the company’s progressive green marketing approach. It is important for marketing to become part of an integrated approach to corporate reputation and risk management and not simply to run independent programmes. Arguably, marketing has a real claim to be the function where ethical and sustainability initiatives are located and managed on behalf of and linked to corporate planning functions. However, new and developing practice in sustainability management is tending to locate management of relationships and sustainability programmes within new general management functions, particularly in the new CSR units cropping up in leading companies. In arguing for its role in managing ethical and environmental issues, marketing may be able to link new tools and models developed in CSRsustainability fields to marketing’s already powerful practice and thereby integrate key management processes within the practice of professional marketing. Ty Francis (2001) cites Interbrand’s recent report on ‘The


Future of Brands’ which makes it clear that successful brands in and of the future are going to have to start contributing to society in order for people to want to do business with them: We’re talking way beyond cause related marketing here. Whether your values match or enrich the customer’s personal values is becoming a business-critical strategic issue and looks set to become an important element of commercial competition in coming years. The key marketing assets for general management consideration include the following:

• Relationships Stakeholding has become a model that marketing should • •

•

•

be seen to manage, particularly linked to new customer relationship management (CRM) models. Reputation Brand and corporate reputation programmes are likely to require linkage to new internal risk management and audit systems. Intangible value In the future brand and reputation valuation models, along with customer relationship management, are likely to be connected with the financial valuation systems, whether with marketing’s involvement or with. Innovation As innovation is increasingly seen as an organization-wide process, marketing may be able to link new market and consumer research and NPD processes with new internal systems for generating innovation. Communication The communication system should be realigned to encourage communication with stakeholders and redesigned in order to be able to deal with complex ethical and environmental issues.

Is it possible to imagine marketing itself changing to become driven by ethical and sustainable values – part of the management team responsible for embedding ethics and sustainable performance within every responsible business and not-for-profit organization? Taking on such responsibility might also lead marketing back to the boardroom, where it absolutely belongs in the complex postmodern global economy. The big question is whether marketing can redefine itself around new social and environmental realities and, excitingly, whether it can reposition itself to deliver on the enormous potential for business, as the most obvious means of securing social and environmental resource integrity, to support markets, communities and societies alike.


Cakes or recipes? New product development, distribution and pricing In the information-rich world, should marketers concentrate on shipping cakes or sharing recipes? Information is the key resource in the knowledge age. Marketing information is speeding up the innovation process as competing organizations begin to innovate across their operations and along their supply chains and partner networks. Marketing’s unique concern is to match product and service innovation and to deliver increased performance from the business to its markets. Leading thinkers now associate innovation with the ethics of cooperation that allows different groups and individuals to trust one another and to build agreements based on mutual advantage. The process of trustbuilding that underlies finding, retaining and maximizing the value of key innovation relationships is at an early stage of understanding, but certainly points towards a future based on marketing providing a clear set of relationship values to innovation partners. The textile manufacturer Designtex provides an example of sharing sustainable business practices. The company opened the use of its proprietary Climatex Life-cycle system of manufacturing 100 per cent biodegradable fabrics to the entire textile industry. In sharing its proprietary research and development with its competitors, Designtex embraced the ‘co-opetition’ business model. Complementing the internal model of trust-based innovation is a market-led response that demands new products based on new consumer attitudes. Local community development and localization of human and strategic resources is likely to play a part in new product planning for sustainable development, as is the low-resource model of sustainability, supported by information- and technology-rich communities. E-trading and information technology are increasingly used to support real-time knowledge and information and are also contributing to more sustainable patterns of resource management and distribution, that is just-in-time delivery. Even in the IT hardware sector, previous notions of planned obsolescence are now starting to be driven out of the market by the concepts of eco-design, eco-efficiency, upgradability, dematerialization and virtualization, extended producer responsibility and take back. As Geoff Lye of Sustainability told inquiry participants: Marketing is fundamentally concerned with innovation and when we look at traditional industries, there is a small group of inspired,


enlightened businesses that are starting to think, using a different, increasingly dematerialized frame of reference. For example car manufacturers like Ford – shifting from car manufacturing to provision of mobility; chemical manufacturers thinking about leasing the chemical unit until it’s served its useful purpose and then taking it back and re-using it; carpet manufacturers Interface, moving from manufacturing carpets to providing a floor-covering service. All carry incentives to minimize the volume being produced and maximize the value. The shift from volume to value is profound. The developing world offers new markets and outlets for low-cost sustainable solutions that can be applied quickly and successfully in multicultural, multicommunity environments and in all, including the poorest, economic climates. For marketers the options are to focus and concentrate on home market sustainability and ethical strategies for products and service development while also preparing for new market development in dramatically different but centrally globalizing multimarketplaces. According to economist Hazel Henderson (1996): When entrepreneurs and investors establish themselves in virgin territory (an unexploited wilderness or a traditional, non money-using culture), they can compete as long as the ‘market space’ allows. Then, similar to ecosystems, as more competing firms (or species) arrive, all the available niches in the market (or ecosystem) get filled. At this point species and firms must shift to symbiotic, cooperative strategies and learn to coevolve, as in evolutionary biology. Pricing is likely to become part of this equation as the world moves towards a future based on protected intellectual property and hypothecated taxes and incomes. In this future, local communities will patent and protect local resources. One of the key issues for the future and for the sustainability movement, and where marketing will increasingly play a part, is the establishment of trade, registrations and intellectual properties. The sustainability movement’s next targets are certainly those companies who have set their sights on global patent protection of what is rightfully the property of local people, or in some cases humanity as a whole. These negotiations are likely to be crowded with conflict and long-lived, and may actually be the cause of new commercial and business paradigms as well as having the potential to wreak havoc within the global trading systems.


For marketers, third-party and membership rights are often negotiated through marketing agreements, as are licensing and royalty arrangements. In the case of intellectual property the marketers of the future will need to define policy between social justice and democratic rights, on the basis of concern for life along with commercial expediency and proprietary.

Monologue or dialogue? Communications and e-marketing How can marketing truly listen to the voice of the market? Globalization is being led by information-communications technology (ICT). For marketing in a multichannel media environment, where people are no longer passive consumers of information, the issues are complex (the ‘24/7’ and ‘CNN World’ phenomena). Some definitions of post modern reality embrace the notion that ‘perception is, in fact, reality’. The paradox for communications is that on the one hand it tends to homogenise and standardize while on the other it increases diversity and localization. This is where coherent ideas based on human values are so important. Through distributed networks, mediated reality and ‘the world of signs’ the individual needs some certainty, a certainty that only mindful conduct can deliver. The success of communication technology has been its ability to bring together new groups and new debates, opening up the concerns of people and giving them an opportunity to address them. The simpler life of an earlier age has been replaced with multiple-media-led cultural discourses on every subject under the sun, a situation that has led some people to experience ‘future shock’ but for others represents a unique opportunity to resolve otherwise intractable problems. In the information age, human problems need to be resolved faster and faster as the damage they can cause costs so much to repair, and it is certainly more efficient and effective to address them before they become global. The sustainability debate, based on the ethical principle of inclusivity, attempts to address these issues through an integrated philosophy based on care of people and the planet. Communication is at the heart of democracy in the postmodern age because people’s access to communications, ability to learn, change and improve their lives is based on being able to communicate. Mass-marketing and media have always been the setting for much debate, but as the media world fragments and differentiates, it is likely to face the demands and subtleties of increasingly complex ethical and


environmental concerns, including how it handles itself in terms of technology, news, commercial and personal information and advertising. For advertising agencies, for example, this could mean a shift in attitudes and role. At present, it may be argued, agencies act as advocates for their clients; like lawyers, they do not judge but merely seek the most convincing arguments. Should they instead, for the sake of their clients as much as for themselves, develop their own principles? How can they advise clients, and build communications which attempt to transmit a sense of integrity for themselves and the brands they are charged with managing? If agencies do not confront these issues do they risk loss of credibility with consumers? If so, the medium of advertising might be ‘discounted’ by informed consumers, who will search for more flexible media options. The emerging discussions on media, journalistic and internet advertising and information ethics are only now beginning and are likely to become key debates in the information age. Marketing as a major sponsor of the media will need to take its place in the centre of these diverse, dynamic and sometimes dangerous debates. Understanding ethical reasoning and communicating sustainable solutions is likely to provide a way to steer through the rapid white water in issues management. Traditionally, a key role for marketing communications has been the interpretation of consumer trends. The use of new ethical terms and the ‘discourse on sustainability’, driven by citizens and consumers alike, represents a language that marketing is well advised to learn, understand and speak, or face being marginalized or locked out of emerging ideas and debates. As communication channels are now so numerous, interaction with consumers and stakeholders using interactive processes and ‘live’ dialogues is going to increase. Although often no more than focus group opinion-gathering, interactive customer participation is a new and dynamic field contained within the sustainability movement. An inquiry participant noted: Best practice has already moved away from recognizing only short term cash profits, towards a broader vision of ‘long term shareholder value.’ We now recognize many other ‘stakeholders’ alongside the shareholder. But as long as we work in a capitalist economy, the shareholder is the lead stakeholder. But considerations of long term shareholder value depend crucially on the engagement and performance of the other stakeholders – and hence the needs and motivations of the other stakeholders must be taken into account.


Marketing may need to introduce and oversee strategic planning for integrated communications, planning that takes into account the principles and policies relating to ethical and environmental concerns. New media, particularly e-marketing and e-services, generally conform to the low-impact and low-resource model of sustainability. However, the virtual economy is only just emerging as a rich and low resource media environment and there are still issues of inclusivity. A UNDP report comments: The network society is creating parallel communication systems: one for those with income, education and – literally – communications, giving plentiful information at low cost and high speed; the other for those without connections, blocked by high barriers of time, cost and uncertainty and dependent on outdated information. (UNDP, 1999) For marketing, models of e-commerce tend towards increased interaction with customers, increased information and choice and improved customer relationships as a consequence. Still there are many lessons to be learned for marketing. An ethical understanding of customer choice, and the ability to trust new e-models of business and the quality of their information assets, suggests a more empowered customer, client and consumer. This in turn is leading to increasing interest in ‘the ethics of information management’ and its many associated issues.

Old school or new cool? Marketing profession, codes and ethics and training Can the profession of marketing learn faster than the society it serves? The issues for professional marketing relate to the speed of development. Wider business ethics may define how a company integrates core values of honesty, trust, respect, and fairness into its policies, practices and decision-making. Organizational ethics may also involve an organization’s compliance with legal standards and adherence to internal rules and regulations. Today, a growing number of companies are designing values-based, globally consistent programs that give employees a level of ethical control that allows them to make appropriate decisions, even when faced with new challenges. At the same time, the scope of organizational ethics programmes has expanded to encompass a company’s actions with regard not only to how it treats its employees and obeys the law, but


also to the nature and quality of the relationships it wishes to have with stakeholders – including shareholders, customers, business partners, suppliers, the community, the environment, indigenous peoples and even future generations. During the inquiry, participants were asked to create their definition of sustainable marketing; in response to the question, ‘What would sustainable marketing look like?’ the following descriptions were given:

• Brilliant at creating well-being (and not just financial wealth). • Gets marketers to ask different questions. • Acknowledges finite resources and the ultimate fragility of current business models.

• A positive celebration of human diversity. • Makes long-term choices. • Allows consumers and businesses to make genuinely informed choices.

• Takes responsibility for its full sphere of influence over time, locally and globally.

• Fully recognizes the value of the human soul. In order to work towards redefining itself, marketing needs to develop its involvement in organizational governance and reputation management based on a set of professional principles related to the ethics and sustainability of professional thinking. It needs to reinvent itself as a key discipline for linking organizational and environment change, and for protecting the value of intangible assets and organizational relationships. New measures of human and environmental performance will increasingly be integrated into marketing research and the valuation of key intangible assets such as brands. Marketing should become more involved with stakeholder relationships as well as specifically with customers and be responsible for measurement and assurance of these relationships based on well-regarded marketing theories of the lifetime value of the customer and the model long-term valuation of customer relationship management. Information and communications are also of critical concern for marketers; however, marketing must be ready to accept the demands for transparency and accountability that go with the vast power of information management systems, and the great responsibility that goes with resource management of new-economy assets. Demands for greater responsiveness are driven by potential customers, and shareholders and business organizations are becoming more sensitive to the perception of


their licence to operate – defined not by the organization alone, or even by industry regulators, but by a broad and systematically informed society itself: The net effect of the high level of material consumption of all types engendered by the marketing system [says Laurence Feldman (1971)] is what has been called a ‘mass-and-energy nimbus’ that, even with fewer people, would threaten the environment. As this knowledge becomes available, marketing must assume the moral burden. Failure to do so erodes marketing’s long-run usefulness to society and implicitly threatens the well being of individual consumers. Furthermore the failure to recognize and respond to its responsibility implies that the marketing system will fail to make the adaptation necessary for its healthy survival. Marketing can learn from other management disciplines that have engaged with ethical and sustainable thinking and add value though professional development and training for new management processes, that link ethical reasoning with suitable management systems and that gradually reposition the marketing profession as the key discipline for integrating innovation and new business relationships within the business. Marketing might then re-establish its role of facilitating and regulating organizational activity rather than positioning itself more tactically and less crucially as a key discipline of strategic management. An inquiry participant comments: Marketing is a paradox in itself in that it should be the principal activity of all CEOs and senior board members in shaping the future of businesses and yet it is usually practised at a much lower level and nearly always in the promotion of existing products and services. The recent shift towards stakeholder relationships is forcing a change of emphasis at company and corporate board levels and there is every danger that the economic and ethical issues that are incorporated in the marketing function will be usurped by other management disciplines as these seek to maintain their ascendancy in the hierarchy of management. If this were to go unchallenged, marketing would cease to be a separate management discipline and would become enshrined as the sales promotion function attached to the sales department, as is now the case in so many businesses.


Re-established as a key strategic activity, marketing can offer business organizations a professional management discipline founded on key principles that are agreeable to both the old and the new economy. As such, marketing will offer a service that puts people at the heart of the knowledge organization and positions both internal and external relationships as the key management and strategic asset of the organization.

Research conclusions For marketers, this research into sustainability, ethics and marketing highlights issues of increasing social and environmental complexity and begins to frame a marketing-led response that may take years to fully define. Reflective debates and well-defined responses are likely to bring new stakeholder groups towards the marketing field – particularly and very encouraging for marketing high levels of innovation from the voluntary and debureaucratised public sector. Such dynamism requires marketing to listen to voices not always heard before, particularly in order to understand and communicate new complexities and build professional competencies to deal with them. Since the 1970s, marketing has responded with social and green marketing strategies, but these may have been solutions provided as specialist marketing responses to what are now generally seen as broad questions of business theory and conduct. The Co-operative Bank in the UK and Bodyshop International with its brand-values success story are organizations employing ethical approaches that may point towards the future despite being unique and original. According to the participants of the inquiry there appears to be little point in having an ‘ethical sustainable marketing’ if ethics and sustainability are attached to a business that is neither ethical nor sustainable. There is increasing concern confirmed by this research, that new demands for ethical and sustainable business practice have left marketing theory, if not practice, behind. As forward-looking management groups seek to integrate total business responses to new attacks on their reputation and build their ability to deal with ethical and environmental problems, marketing appears to be left on the sidelines. New debates on reputation risk, governance, corporate social responsibility and sustainability are emerging through leading organizations both business and non-business, potentially affecting the way all organizations manage their tangible and increasingly valuable intangible assets. What is truly a paradox is that these new responses appear to have much in common with marketing practice and yet marketing appears often to be excluded from new systems


for their management. Surely it is the success of marketing concepts (such as relationship management) that are now sweeping business more generally, and, according to the findings of this research, may force marketing to once again reinvent itself in order to take up its key role of linking the business with its increasingly sustainable and ethical operating environment. Another view apparently growing in the marketing community, and among the participants of the research inquiry itself, is that its clothes have been borrowed, restitched and dyed, and have become the tools of a newly empowered general management wielding a revitalized wardrobe, attended by a group of management consultants busy tailoring the haute couture of strategic marketing into the ready-to-wear of strategic management. Marketers have long foretold the accretion of marketing into management and the corresponding drain of prestige and fees taken away from the field. Marketers beware. Marketing should respond, to produce research and tactical frameworks that support its role as the guardian of many of the key intangible assets of business, including its relationships, reputation and communication resources. It is a key finding of this research inquiry that the profession of marketing can learn from the developing practice within corporate social responsibility and sustainability management and should take up some of the tools freely available from these fields, coopting them for its own professional practice and thereby strengthening its immediate role and strategic response to longer-term global issues. Within the present debate on globalization marketing is itself paradoxical. With marketing viewed by many as a culprit, promoting consumption and unrealiztic demands, few people consider its role in increasing the efficiency and conservation of resources (through product development, packaging, distribution and so on.) or in innovation and market responsiveness (through relationships, intangible value and reputation), roles often neglected by critics and under-promoted by marketers themselves. As the research indicates, it is marketing’s responsibility to resolve its own paradox and face its many in situ dilemmas, but not because to do so will minimize ethical failing and misinformation outside marketing, nor because it will improve the profession’s reputation and value to business, management and society. Marketing needs to show it can deal with ethical uncertainty in the world – because that is marketing’s very purpose, serving people and their society by understanding their needs and concerns. Ethical thinking may also be a realiztic peg upon which the next generation of professional marketers can hang their suitably


green and sustainable hats, allowing marketing to be viewed as the key discipline for commercial success and social cohesion in the globalized business world of the twenty-first century.

Towards an environmental research agenda Parameters for further research In the light of the emerging research conclusions, the inquiry participants were asked to comment on the nature of the potential outputs from the Paradox in Marketing research work, both from the point of view of short-term outputs which could be aimed directly at the marketing profession and for the sake of the wider research and communication agenda. The participants’ comments and responses echoed five key themes: involvement, inspiration, innovation, integration and implementation

Involvement – engaging industrialists and marketers The notion that people who are dealing with marketing on a day-to-day basis need to become engaged in issues of sustainability and ethics because marketing is a key part of the ethical debate in society. However it is also important for each corporate body as a whole to take an interest in these issues in such a manner that it changes the way it operates. Neither the CIM nor any member of the marketing community is going to be able to make a change of this magnitude on their own. As one participant commented, ‘For me, it’s [all about] who we are involving in the discussion rather than what the discussion is, otherwise we’ll be a closed loop.’

Inspiration – the Chartered Institute of Marketing as a change agent The institute needs to be a force for change if self-regulation, rather than government regulation, is the way forward. Professional associations have an important part to play in improving standards, setting policies, and creating visions. The CIM has a key role to play in moving the ethical debate on. The Institute has the opportunity to inspire 60 000 marketers to ask different questions. Refining those questions and embedding a questioning ethic into the curricula at all levels may encourage people to ask themselves what the different issues might be rather than always looking to someone else to provide the answers. This approach was emphasized by the participants, one of whom said: ‘Any frameworks that are developed will not get used unless there is a strong component of awareness and education in the profession


and beyond. It is not just about depositing knowledge; it’s also about an active change programme.’

Innovation – getting marketing to lead from the front There is a danger in promoting a compliance-plus stand which merely shadows legislation, as opposed to being well out in front, designing modern marketing around sustainability that is, for instance, more effective than conventional marketing. It is vital to get into marketing the mindset that you can redesign the process of marketing through sustainability, through much more cost-effective means of selling your product. This clearly involves research and development of tools and processes, and putting together a new language.

Integration – the language of sustainability in marketing As one participant stipulated, Perhaps [some] of the success criteria for this project [could be] that eighteen months down the line the language of sustainability has entered the language of marketing [and that furthermore] that the Institute [the CIM] is talking the language of sustainability [and using it to educate future marketers].

Implementation – multilayered outputs Participants felt that to move the debate forward would require multiple efforts embracing the following:

• the creation of usable outputs, tools that measure value creation, and so on.;

• the encouragement of active debate and exchange of information at all levels of the system;

• the development of new concepts and ideas that can then be applied.

Ongoing research project agenda Building on the findings from the inquiry, the project team considered ways in which further research could influence the future agenda for marketing. If the profession of marketing does not embrace these issues then it runs the risk of other business disciplines taking over what was once clearly the role of marketing. Key research areas to be taken forward include the following:


• Governance in marketing – reviewing market and corporate theory

• •

•

• • • •

•

•

including a survey of marketing participation in the corporate governance of FTSE 350 companies. Using sustainability as a driver, the research would assess how marketing might understand and thereby improve its role in the development of corporate sustainability through governance. Corporate social responsibility in marketing – investigating the connections between CSR and marketing, reviewing existing theory and case information and producing a report and training materials. Brands and intangible value – researching the role of marketing in creating and protecting corporate value and values. The measurement of intangible value may be a key method for building marketing’s credibility and role in the sustainability debate. Reputation and relationships – exploring the role of marketing in building and protecting key corporate assets, particularly the values inherent in relationships and the building of trust to underpin reputation, adapting new concepts of sustainability towards marketing. Corporate reporting – reviewing new corporate reporting techniques and outputs, particularly those relating to reputation risk, environment and social reporting. Media ethics – investigating the link between organization, communication and the ethics of media that are sponsored by vast amounts of marketing activity. Standards, frameworks and tools – reviewing existing management systems and frameworks that may be adapted for marketing. Professional and educational practice – investigating how the profession may develop its practice and education material in the light of new understanding of ethical and sustainable learning, including review of key definitions, principle and practices. International development – working with international partners to build a discourse within the international marketing community, looking at ethics, sustainability and the interrelationships with globalization. Regional projects – linking with local networks and regional CIM chapters to feed the learning and outputs of the project.

Note 1. For more information on the inquiry-led approach, see: www.bath.ac.uk/ carpp.


References Clancy, F. and R. Wright (1999) Towards Sustainable Brands: A Step by Step Guide to Securing a Share of the Future, UNEP paper on the role of advertising in sustainable consumption. Drucker, P. (1992) ‘The New Society of Organizations’, Harvard Business Review, 70:5, Sep/Oct. Feldman, L. (1971) ‘Societal Adaptation: A New Challenge for Marketing’ Journal of Marketing, 86, July, 54–60. Francis, T. (2001) Branding – The Puzzles and Paradoxes. Nowhere Group Paper. contact:[email protected] Henderson, H. (1996) Building a Win-Win World. San Francisco: Berrett-Koehler. Klein, N. (2000) No Logo. London: HarperCollins. UNDP (1999) Human Development Report. New York.

Further reading Commission Green Paper: ‘Promoting a European Framework for Corporate Social Responsibility’, July 2001. See: http://europa.eu.int/eur-lex/en/com/gpr/ 2001/com2001_0366en01.pdf Resolution of the Employment and Social Policy Council on CSR. Recalling: The Commission Green Paper on promoting a European framework for Corporate Social Responsibility, which launched a consultation procedure on the concept of corporate social responsibility (CSR). December 2002. See: http://www.europa. eu.int/comm/employment_social/soc-dial/csr/csr_resolution.html European Parliament Report on the Communication from the Commission concerning Corporate Social Responsibility: A business contribution to Sustainable Development. May 2003. See: http://www.europa.eu.int/comm/employment_ social/soc-dial/csr/sipade2.pdf Launch of the EU Multi Stakeholder Forum on CSR, October 2002 http:// forum.europa.eu.int/irc/empl/csr_eu_multi_stakeholder_forum/info/data/en/ csr % 20ems % 20forum.htm ‘Commission urges greater Corporate Social Responsibility in Europe’ 18 July 2001. See: http://www.europa.eu.int/comm/employment_social/soc-dial/csr/green paper_press.htm In the UK Douglas Alexander was appointed minister for corporate social responsibility in 2000 following the European debates. Details of the UK government focus can be found on the following website: http://www.societyandbusiness.gov.uk/ Business in the Community – set up in 1983, this is one of the largest and longest established organizations supporting corporate social responsibility. Their website has a case-studies database, resources (MORI research and a contacts list), and advice on reporting CSR; see: http://www.bitc.org.uk/marketing.html Business Impact Taskforce – improve your impact on society. Set up in 1998 in the UK, its website is: http://www.business-impact.org/bi2/front/index.cfm FTSE International, which runs the stock market index, has a website which will include only companies that qualify as socially responsible. See: http://www. ftse4good.com/frm_home.asp The Association of British Insurers has published investment guidelines to include ethics, risk and the behaviour of companies: Report by the ABI: Investing

282 Marketing and Sustainability in Social responsibility – Risks and Opportunities, December 2001. See: http:// www.abi.org.uk/ResearchInfo/SocialResponsibility/ Social Accountability International (SAI). Details of their global standard Social Accountability 8000 initiative can be found at: http://www.cepaa.org/ Institute of Social and Ethical Accountability. Website: http://www.accountability.org.uk/aboutus/default.asp?level1=tools Global Reporting Initiative. – Aims to create a common global framework for reporting economic, environmental, and social impact of the organization. See: http://www.globalreporting.org/ The Sunday Times 50 Best Companies to Work For in the UK. DTI-sponsored survey. See: http://www.greatplacetowork.co.uk/Bestlist.html Awards for Excellence 2000. Sponsored by the DTI in association with the Financial Times. See: http://www.business-impact.org/bi2/case_studies_2k/ Enterprising Communities: Wealth Beyond Welfare. A report to the Chancellor of the Exchequer from the Social Investment Taskforce, October 2000. http:// www.enterprising-communities.org.uk/rpt-cont.shtml United Nations research programme on corporate social responsibility. Produces a variety of publications. See: http://www.unrisd.org/engindex/research/busrep.htm International Labour Organization. Its Database on Business & Social Initiatives includes information on private sector initiatives. See: http://oracle02.ilo.org/ dyn/basi/welcome Winning with Integrity Handbook by the Business Impact Taskforce. This report can be downloaded chapter by chapter. It includes information on how organizations can get started on social responsibility. See: http://www.businessimpact.org/bi2/homes/winning.cfm Starter Pack on Social Responsibility, by the Business Impact Taskforce. Excellent short points in the section on marketing. See: http://www.business-impact.org/ bi2/starter/index.cfm Business for Social Responsibility (BSR). This is a global membership organization. See: http://www.bsr.org/ Centre for Social Marketing – University of Strathclyde. Its website includes definitions of social marketing. See: http://www.csm.strath.ac.uk/ CSR Europe. This European business network was launched in 1996. See: http:// www.csreurope.org/ The Sustainable Development Unit. Website: http://www.sd-commission.gov.uk/ Ethical Corporation magazine. The first independent by-industry, for-industry briefing on the business case for corporate social and environmental responsibility. Provides free print and online publications which looks at the operational issues in corporate social and environmental responsibility. See: http:// www.ethicalcorp.com/ European Marketing Council (EMC). The voice of marketers in Europe; for more information See: http://www.emc.be/

Part VI Afterword


12 Local Agenda 21 into Local Action 21 Stephen Bendle

Summary Over ten years on from the United Nations Environment and Development at Rio in 1992, a lot has been achieved to make our lives more sustainable. But there have been serious discontinuities between the actions taken at different levels, by different agencies and through different means. If we are to develop into a sustainable society, the next ten years must go beyond agenda setting and unconnected pilot actions and must instead involve collective action towards goals around which a wide consensus has been generated, built on a solid foundation of research; this will require not only coordinated government action on regulations and taxes but also the active local participation of businesses and people in their everyday lives The ‘Rio + 10’ conference in Johannesburg was a missed opportunity, but it may be that this consensus can be built within UK programmes and more widely under the umbrella of the European Union’s Sixth Action Programme on the Environment.

Since 1992 – government level actions One of the first major successes at the end of the last century was action on some of the most damaging chemicals that were being released into the environment. For example, pressurized chlorofluorocarbons were being used so extensively in aerosol sprays that these and other chemicals could be shown to be damaging the protective ozone at high levels in the earth’s atmosphere. Despite good scientific evidence of damage, it took intense pressure by environmental campaign groups before the signing of the Montreal Protocol, which began to reduce and finally to 285

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ban their use. Uses of other ozone-damaging chemicals has persisted, or a longer period has been allowed for finding replacements, but nevertheless there is already evidence that the ozone hole is becoming smaller again. Individual action to avoid CFC-based aerosols helped, but the change was not one brought about by action at the local level. There was a widespread campaign but the action taken was through regulation so that action by individual consumers was no longer needed. There has been a lot of success, too, in cutting sulphur dioxide and other acid emissions and reducing ‘acid rain’ in the European Union which has caused widespread damage to forests and lakes. Overall a twothirds reduction has been achieved through action at large plants (especially power stations), through requirements to reduce sulphur in fuels and through higher emission standards for new vehicles. This success has not been widely publicized or recognized nor has it involved individuals very effectively. New vehicle purchasers are aware that they have to have a catalytic converter on their exhaust pipe and fuels purchased from petrol stations are labelled as ‘low-sulphur’, but the population has had little sense of participating collectively to reverse acid rain damage. The same is true of the partial progress made in other fields. The approach used across the European Union is to set national standards and targets – for example air and water quality standards and recycling targets – and timescales which each nation agrees to achieve. The EU’s Sixth Environment Action Programme has as its headlines climate change, health (including reducing chemicals in the environment), protecting biodiversity and cutting waste of resources, and these are likely to lead to further targets and standards over the ten years of the programme. In the UK the Environment Agency has been responsible for setting the regulatory framework for water companies and businesses within which these targets have to be achieved, with local authority environmental health staff having responsibilities too for air quality levels where there are exceedances caused for example by heavy traffic. Business is well aware of its responsibilities and is adapting to them, sometimes recognizing that there are opportunities to be grasped as well as increased costs to be borne. Again however public involvement in setting and celebrating the achievement of these targets is weak or non-existent. This dislocation between often well-established government policy and action at the local level was well illustrated by the protests in autumn 2001 over the ‘fuel escalator’. Successive governments had said they were going to increase petrol prices by 5 per cent above the rate of inflation to provide a gradually increasing incentive to cut fossil fuel use.

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However when crude oil prices also jumped, the tax on fuel was widely perceived as no more than that: a source of government revenue, not a policy instrument for change. As a result the debate in the media was rarely about how green taxes might bring about change and much more about the need for affordable travel. The government has recently announced that landfill tax, currently £13 on every tonne of waste going to landfill, is to be increased fourfold in the years to come. For business, the tax has made a difference to the way waste is dealt with: recycling materials is now undertaken more frequently where it is economic. Further measures impacting on business include the packaging regulations, which require large packaging producers to take back a proportion of the packaging they produce or pay various penalties; and future requirements on manufacturers of cars and electrical goods to take back goods at the end of their life for repair or recycling. For households, there is an awareness of strong pressure to recycle more and there seems also be abundant goodwill to support such measures. But the targets, taxes and local voluntary action are not yet part of a collective perception that the rising volume of waste is a problem we all have to tackle together.

Action at the local level At Rio, local authorities were exhorted to develop a Local Agenda 21 initiative, because it was argued that only by everyone acting at a local level could change be brought about. In Bath and North-East Somerset, the Local Agenda 21 Initiative took some time to set up but it has worked effectively with limited resources. It includes representatives from all sectors – the local authority, business, voluntary organizations, campaigning groups, the Environment Agency, the local health trusts, the university and other educational bodies. It was decided that its role should be, through a community conference, to develop and promote a ‘Vision for a Better Future’ for the B & NES area. This document has subsequently been widely used as a core document for the local plan, the local economic strategy and other key local strategies. The LA21 initiative has sought to raise awareness and participation by giving ‘change 21’ awards to people and organizations who have implemented actions that contribute to the vision and has produced a set of indicators which try to show what progress is being made towards it. ‘Envolve’ was set up, as the Bath Environment Centre, in 1994 to provide people and organizations with information about living sustainably. Since then it has developed a range of projects which work directly with


businesses, schools, the public sector and individuals. It has been a member of the LA21 initiative but the initiative has not sought to be an umbrella for all the activity taking place in the local area, so to a large extent Envolve’s work has been independent of the initiative. Work by the council on home energy conservation and domestic waste recycling work (which has had a high national profile) have similarly not been reported to or monitored by the initiative. Envolve employs about twenty staff, divided into three sections based on the audiences it is trying to reach – business, community and education. A section which deals with transport cuts across all three. On the business side, advisers work with local businesses to help them minimize waste, save resources and cut energy and water costs. On average, a firm can make a 4 per cent saving, which should show directly in its bottom line. Some firms, such as Cross Manufacturing, have actually made businesses out of it: Cross installed a process which uses water instead of solvents and is managing to sell this system elsewhere. The community team works on social and regeneration initiatives like a healthy living centre; and, more obviously, on schemes to do with tree planting, energy efficiency, and fresh local food. Both individuals and groups are engaged in actions. Envolve tries to work with all parts of the community on actions they can personally take: work with low-income households on saving energy and water costs is especially important. The education team is led by a full-time teacher who works with local schools, integrating sustainable development into the curriculum. She has worked mostly with primary schools but secondary schools have been engaged too, linking to the curriculum for geography, design and technology, and citizenship. Adult education programmes have also been developed and the education section includes a small youth team, working with young people including some who have dropped out of the system or been excluded from school, using sustainable development as a way of re-engaging them. Transport as an issue affects all three audiences. Envolve has worked with businesses on travel plans, with individuals in developing a car club and travel awareness, and with schools on travel plans. Other initiatives Envolve has been engaged in include the first UK farmers’ market in Bath (and co-founding the National Association of Farmers’ Markets which now supports 220 farmers’ markets across the UK), and involvement in a European network to share action and experience. In all this work Envolve’s role has been to act as a partner to a wide range of businesses, organizations and groups, facilitating and assisting action that they are taking or helping individuals to find out more about what they could be doing as consumers, as householders or in their workplaces.

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Envolve’s strategy has been to act as a ‘horizontal’ partnership organization, seeking to promote engagement of all parts of local society in all the issues which need to be addressed if sustainability is to be achieved. The changes in the tax and regulatory regime; and campaigning by groups like Friends of the Earth and Greenpeace help to drive this practical work at the local level. But the connections made between local action and Government or European policies is weak; and for many businesses and individuals the advice and support from Envolve may only be about how to cope with change, rather than about how to bring it about.

The Contribution of Research The work of universities might be seen as the third strand in bringing about change to sustainable living, providing the research framework within which change can happen. Locally in B & NES, Envolve has had contact with the university in relation to its development of a travel plan and other work on campus to reduce its environmental impact as a business. Postgraduate placements and a joint conference run by Post Graduate Certificate of Education (PGCE) students have also brought the organizations into contact. But perhaps inevitably the major research carried out in different departments of the university on energy, material science, behavioural studies and many other topics relates to research contracts obtained and published at national level. Turning much of this research into action on the ground depends on local organizations picking up on it and finding the means or resources to implement it: it is rare for the research to be implemented locally. Looking at the examples where change has been successfully brought about, the sequence might be generalized as follows:

• • • • •

Research identifies a developing issue and its consequences. Awareness is raised among the public. A campaign or other movement develops, demanding action. New regulations and/or taxes are proposed. New technologies or management techniques are developed in response, sometimes to meet a deadline set in regulations, using new or existing research. • Action is facilitated through advice and local support to enable the change to take place, leading to the reduction of the environmental impact.


Where the mechanism used has been a regulatory approach applied to business or products, the change has generally been successful. Use of green taxes has not had such a smooth path however, especially where the awareness-raising stage has not begun to prepare the ground or build consensus for behavioural change.

Integrating National and Local Scale Actions Implementing change on a wider scale and with the support of the public and businesses alike now requires a more concerted approach. It must link more closely national tax and regulatory change, driven in turn by international agreements at European or global level: (1) with the research which justifies the change, (2) with the research which can show how change can be made and (3) with the action at the local level where the changes must finally happen. The way policy has evolved on each issue has been quite different, and lessons could be drawn from a comparison between them. Examining three current issues may help to illustrate the present dysfunctions.

Recycling There is no general awareness that waste is growing by 7 per cent a year and that this often negates any benefits from increased recycling. There is little awareness, either, of the large disparities in recycling rates in different local authorities from 5 per cent or less up to over 30 per cent for the best performers. The European directives on recycling electrical goods, on the disposal of refrigerator insulation and on the recycling of cars receive mainly negative media coverage, either as unwanted Eurobureaucracy or as examples of poor government planning. The landfill tax and the aggregates tax are not widely known, nor is their purpose widely understood. Few people would have a clear idea of the nature of national targets and the part they are expected to play in achieving them, nor whether this will come about through financial incentives, regulations or voluntary changes in behaviour. Overall therefore while there is widespread sentiment in support for recycling, there is little sense of a national project being put in place to tackle waste and to use resources more wisely.

Energy There is an understanding that global warming is happening, that action needs to be taken internationally and that the government is committed

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to reducing energy use. But there has been little attempt to calculate and communicate the overall potential for energy efficiency or for renewable energy, whether the renewable energy can be generated locally or remotely. Few people seem to know, either, that everyone pays some money on their electricity bills which goes to pay for energy efficiency measures in cutting the cost of low energy appliances or making homes more energyefficient. Businesses are more aware of the energy tax they are now paying, but even there awareness is surprisingly low. The increasing fossil fuel consumption by transport is the major area where consumption continues to rise with GDP, but transport is not yet linked in the public mind with global warming; and rising air transport is still seen as an important driver for economic growth by government, despite commitment elsewhere to energy efficiency. As with recycling, while the policy issues of energy efficiency and greater use of renewables are understood to be important there is however little sense of national direction.

Air pollution As discussed above, it is possible to point to regulatory success in improving air and water quality and reducing acid emissions. Ordinary citizens have played a largely unconscious part in this, buying aerosols driven by hydrocarbons, new cars with catalytic converters, more energy- and water-efficient electrical appliances, and energy and water produced with lower environmental impact. Progress has been made too on volatile organic compounds generally. In the Sixth Environment Action Programme, Europe wants to make progress on regulating some 50 000 chemicals which are regularly used in industry, agriculture and in the home. In this example, success to date has not been recognized or publicized and the opportunity has been missed for showing how public concerns and increased product and service costs have led to action, or how those concerns might be lead to positive change in the future.

The way ahead?-A national context for local action The next stage of Local Agenda 21 needs therefore to be at a different level. National plans need to be developed around key issues and communicated to both individuals and businesses so that they can see how they can play a positive part in their achievement. Local action can then be seen as an essential component of national plans which


will enable it to have a clearer focus and is likely to create a more supportive climate. Many of these plans will need to be based around targets agreed by the national government with European Union partners. Communication between the European Commission and citizens on these issues is extremely poor. Consultation at ground level is not something the Commission does well, and national governments miss the opportunity of communicating the idea of a joint European project for fear of raising hackles over European bureaucracy, although one might imagine it could often be a chance to present the positive aspects of a common regulatory framework to promote a better quality of life. If citizens do not understand what part they are playing and have no chance to debate how change can be brought about, there is a risk, as with the fuel escalator, that there will be no commitment to change or to finding the best way of bringing it about. There needs therefore to be a mix of top-down consultation about identified issues and how they are going to be tackled, combined with a responsive approach to the concerns of local people about the issues they want to see prioritized and the kinds of actions, taxes or regulations they would be prepared to support. The 15 c tax on plastic bags in Ireland is an excellent example of a green tax that has been widely supported and even welcomed. Public information and debate needs to be founded on effective research, first to identify the issues and the technological options and possibilities and second to elucidate the options of green taxes versus regulatory or behavioural approaches. A public debate is needed on all the options from which a national policy framework would develop. Different political parties would obviously adopt different approaches and policy would change over time: for example the contributions to fossil fuel reduction from transport could be reduced and that from housing improvements increased, or the scale of renewable generation could rise provided the overall target of, say, 20 per cent lower fossil fuel emissions was achieved. But the underlying data and models would still be there against which these alternative approaches could be formulated and assessed. Some simpler way of communicating progress towards the goals set by national policy – less waste, greater energy efficiency, lower carbon emissions – is needed too: the government’s published set of sustainability indicators showing overall progress towards a better quality of life is admirable, but as a communication tool with the general public it is far too complex.

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The European Environment Agency, in order to assess progress in the transport field towards agreed policy objectives, set up the Transport and Environment Reporting Mechanism to compare policies with the actual situation in each EU state. It found that in no country had there been an overall assessment of how much the transport sector was contributing to overall carbon emissions, nor of how the overall level of emissions from transport needed to change (presumably by falling) if the targets agreed at Kyoto were to be achieved. In the UK, some studies are now under way to look at the energy ‘footprint’ of all sectors in each region and where change might be made most effectively, either to save energy or to generate it more from renewable sources. But these are tentative and are not yet part of a wider process to develop a national plan. Although the transport sector is proving a particular problem, with energy use continuing to rise alongside rises in GDP, continental Europe is nevertheless some way further forward in developing national plans. The Netherlands has had a policy on energy reduction which has not only been part of political manifestos but has also been a significant factor in deciding some recent elections. It includes the use of variable taxes to provide a predictable price which gives both business and households a level of pricing which makes many more efficiency measures economic. Passive solar water heating for example is virtually economic, whereas in the UK it is quite some way from being so. In Gothenburg, Sweden, district heating has been more common and has provided a network through which combined heat and power systems have been developed. Most homes in the city are now heated via mains services which distribute waste heat from industrial estates. An integrated approach of this kind would enable local plans and activities to be seen in context. This would both increase the sense of purpose and provide more powerful arguments for more controversial changes both at national and local level. Green taxes would be viewed less cynically as they would be part of a deliberate and published longterm strategy for change and, locally, changes in transport or planning policy or targets for renewable energy could be seen as contributing to wider change. At the individual level, information campaigns to seek changes in behaviour to reduce waste or energy could be given greater force by contributing to a national programme or national targets. At the local level, Envolve has considered how best it can organize its partnerships:


• Around audiences: working with businesses, schools, the public sector, community groups or individuals.

• Around the issues: energy, water, waste, biodiversity and so on. • Around the ways to bring about change: demonstration projects, advice and information, training, bringing people together to act collectively and so on. Partly because a number of national and regional organizations already exist whose experience and skills can be drawn on when needed, the most effective approach has been seen as one related to the audience, where different methods of providing support and partnership can be selected to meet different circumstances. In many local authorities the LA21 process has been subsumed by the development of local strategic partnerships (LSPs), which are intended to be an inclusive vehicle for taking forward improvements to the quality of life in the district, with a community plan as the focus for how this should be achieved. In B & NES, the LA21 Initiative has become one of the key partnerships which come together to form the LSP. In every local authority the number of strategies and partnerships has proliferated enormously in recent years and LSPs could be an effective way of making sure these link together effectively. There is considerable potential for this structure to set targets and programmes, and also to find ways in which the partnerships can gather resources to make these happen. One of the areas where this might be closest to achievement is in relation to waste. A framework of targets for recycling has been set by Europe for domestic waste and packaging regulations, aggregate tax and landfill tax are all in place. Statistics have been collected for waste volumes and trends – which as already mentioned above show volumes increasing by 7 per cent per annum. Locally Bath and NorthEast Somerset has taken a lead on recycling and has said it wants to work towards the principle of ‘zero waste’. It is seeking to establish an ‘environment park’ where waste materials would be processed and turned back into useful products. Envolve has been working for six years with local businesses on waste minimization and can already show how this has helped many to save money or adapt their processes. Local recycling organizations such as SOFA in Bristol (who repair furniture and white goods and sell them to low-income households) and RecommIT in Salisbury (who repair or dismantle and recycle IT equipment) are already operating. Charges are already made for the disposal of organic waste and bulky waste, and the B & NES waste team has a strong track record of innovation.

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It would not be a giant leap therefore for a waste partnership to be set up within or alongside the LA21 partnership which establishes a range of targets related to national targets. The partnership would need to include a range of business, research and practical expertise and people with knowledge of both domestic and commercial waste. Its task would be to agree how a wide range of individual and collective actions could contribute to the targets, could plug research and information gaps, and could develop new projects and ideas as necessary. It would seek to communicate with members of the public about how their actions were contributing and where insufficient progress was being made. Where targets look like being missed or circumstances change, the partnership would have the task of finding new solutions or approaches to put the programme back on track. Such a group almost exists already in B & NES and would need only some widening of aims and membership.

Conclusions Since Rio in 1992, some good progress has been made, although on the whole this has not been sufficiently celebrated, nor are people and businesses aware of how they have played their part through changed behaviour, new products and technologies or via the cost of goods and services (for example low-sulphur fuels, tighter building regulations on new homes, higher water charges) or changed behaviour. There has not been enough connection between (1) international and national policies which have led to tax and regulation changes, and (2) the ‘local agenda’ which is where individuals and organizations react to these changes and become involved through local planning and local actions in bringing about the change in their own areas. Academic research has been too distant, helping to inform policy and regulation but not engaging enough with what this means locally. The next phase of the move towards more sustainable lifestyles needs to be more connected and more strategic. National plans are needed which plot a potential course to lower fossil fuel use, lower waste volumes, greater recycling and reuse and greater protection for green spaces and biodiversity; and these need to be consistent with policies for economic development and housing. These plans would change over time as political parties change but the statistical models would remain. This target-based approach fits well with the way the European Union is now seeking to bring member states’ sustainable development policies into line, leaving local flexibility for the means of achievement.


The Local Agenda 21 process could then become more clearly a local action plan which sets out the contribution the district or subregion will be making to these national targets and how this is to be achieved. This plan would help to underpin and provide a significant part of the underlying justification for action taken in relation to local plans, transport plans, waste action plans, economic development plans and many others. It would also enable change organizations such as Envolve to engage people and businesses in actions that contribute towards wider totals. These might in the short term be simple targets such as a number of solar panel installations, the number of people switching to cycling to work instead of driving or the percentage of people using their green box for recycled materials. But these local targets could be brought together to show how the local contribution relates to targets in a national plan. This would more clearly show both the progress made towards sustainability and what more needs to be done, giving the LA21 process a much stronger role in local planning as a whole.

Index accommodation 59–60 acid rain 286 action research 258 Afghanistan 154 Africa 250 age 56, 103, 109, 112 aggregate tax 290, 294 agility 237, 238 air pollution 291 see also willingness to pay, mortality and air pollution in Brazil air quality 286 Alberini, A. 108 Allan, J.D. 92 Allenby, B.R. 13–14 Amin, S. 179 angling 92–8 Ansell, M.P. 211–31 apparel 235 Appleton, J. 54 Aquilon, M. 245 Arthur Anderson 263 Asia 129 ASPT 89–90, 91 assimilation 59–60 Atran, S. 54 autism 41 AutoCAD Mechanical DeskTop 214 automotive supply chain 235–52 advanced manufacturing and distribution 239–40 build-to-order effects 238–9 distribution 243–4, 248 environmental impacts 239 implications for practice 251 implications for theory 251–2 inbound logistics and implications 246 inbound logistics and supplier impacts 249–50 material and component supply 245–6 research methods 240–1

supplier operations implications 247–8 vehicle assembly 244–5 vehicle painting 249 averting behaviour method Ayres, R.U. 14

107

Balling, J.D. 56 Barry, S. 35 Basel Convention 123, 127, 132–4, 135, 136, 140, 145 Bath Environment Centre 287–8 Bath and North East Somerset (B & NES) 289, 294, 295 Baum, H. 239 Bauman, Z. 156 Beck, U. 35, 37, 42, 46, 47, 48 Beckerman, W. 156 Beckett, R. 258 Belgium 127, 128, 149 beliefs 72–3 Bendle, S. 285–96 Berlin, B. 54 best available technology not entailing excessive cost 227 Bilgen, E. 195–6 bio-oils 22, 24, 25 biological quality 89–90, 91 biophilia 54–5, 56 Birdsall, N. 125 Bis, B. 91 Blühdorn, I. 36, 149–69 BMW 236 Body Shop 267, 276 Bond, C. 256–81 bootstrapping 58 Boster, R.C. 56 Bourassa, S.C. 52–3 Boyd, R. 125 Brack, D. 124, 126, 127, 134 Bramwell, A. 151 brands 263–5, 280 Brandt, W. 157, 162

297

298 Index Brazil 133, 266 see also willingness to pay, mortality and air pollution in Brazil Broome, J. 9 Brown, D.E. 52, 71 Bruggink, J.J.C. 201 Brundtland, G.H./Report 5, 178, 182, 204 BSE 154 build-to-order 237–8, 240–1, 243, 248 Bundesrat 154 Bundestag 151, 159, 163 Bundeswehr 154 Bündnis 90/Die Grünen (Alliance 90/The Greens) 150 Burrows, C.R. 8, 18, 19, 20, 24 Bush, G.W. 143, 161–2, 164, 168 buyer behaviour 265–6 Cairns, S. 239 Canada 13, 188 ‘Canon of Knowledge’ 259 Canter, L.W. 14 capital stock 10 carbofluorocarbons 128, 129, 130, 134, 286 carbon dioxide 39–40, 180–1, 182, 183, 204, 206, 244 Carey, S. 54 cycle 199 catchment impacts on river 89–91 CBE 154 CEC 124 Central Europe 26 Centre for Agricultural Strategy 25 Chapman, P. 6–7, 11, 12, 186, 194–5, 205 Chartered Institute of Marketing 256, 257, 259, 278–9 chemical indicators 89 chemical quality 91 chi-squared test 65, 66, 67, 68, 69, 94 China 125, 128, 130 Chomsky, N. 57

Christopher, M. 238 Clancy, F. 264, 266 Clausius, R. 178, 199–200 Clift, R. 177 Climate Change and Global Trade project 135 Co-operative Bank 266, 276 coal 178, 180, 183, 184, 193 codes 273–6 cogeneration plant 195–7 cognitive development, stage theory of 58–9 cognitive/information processing level 63 combined heat and power 27, 195–7 Common, M.S. 8 Commonwealth of Independent States 178 communication 268, 271–3 compensating wage method 106, 107, 108 Conservative government 153, 157, 161, 167 contingent valuation method 8, 23, 106, 108, 118 continuous source reduction 239 Convention on International Trade in Endangered Species 123, 127, 131–2, 136, 145 cooperative inquiry approach 258 Corning, P.A. 203 corporate reporting 280 corporate social responsibility 256–7, 261, 264, 267, 276, 280 cost formation process 27 cost–benefit analysis 5, 8–10, 18, 22, 25, 28, 29, 205 willingness to pay 102–3, 104, 105, 107 Costa Rica 132, 133 covering law theory 72, 73–4 Cramer’s V-test 65, 66, 67, 69 Cropper, M. 104–5 Cross Manufacturing 288 Cruz, W. 125 Cuffney, T.F. 92 customer relationship management 268 Czech Republic 160

Index 299 Daley, J. 41 Daniel, T.C. 56 Däubler-Gmelin, H. 164 De Castro, J.F.M. 217 De Geus, M. 35 Dell Computer 235–6 dematerialization 198 democracy 44, 45, 48, 49, 155 democratic convergence 42–8 demographic information 106 Department of Energy 22 Designtex 269 desires 72–3 Deutsche Telrom 162 DFID 137 Dincer, I. 29, 187, 188, 189–90, 193, 201, 202 distribution 269–71 Dixit, A. 141 Dobson, A. 35, 38, 42, 43 Doherty, B. 35 domain-specificity thesis 57 Doran, D. 245 Dorfman, N.S. 8 Dorfman, R. 8 dose-response functions 118–9 Doughty, M.R.C. 178, 179 Doves Farm 266 Dräger, K. 151 Drucker, P. 266 Dryzek, J.S. 42, 43, 44, 46, 48 Duguay, C.R. 238 Duncan, J.S. 56 Dutschke, R. 153 Dyer, J.H. 245 e-marketing 271–3 Eastern Europe 250 ecological approach see river quality: ecological and economic approach ecological-economic model 98 ecology 203 econometric analysis 98 economic approach see river quality: ecological and economic approach Ecover 267 educational practice 280

efficient consumer response 237 egalitarianism 155 egocentrism 155 Ehrlich, P. 36 El-Sayed, Y.M. 26 elaboration phase 229 electricity 11, 22, 23, 26 engineering sustainability 182, 186, 189–90, 192–5, 197, 205–6 elimination/reduction phase 228 emissions permits 9 energy 28, 290–1 energy analysis 11–12, 183–6 energy, free 203 energy productivity improvement 197–8 energy in quantitative and qualitative terms 11 Energy Review 17 energy sector 178–83 energy systems see thermodynamics and energy systems Energy Technology Support Unit 11 energy transformation system 185 Engineering and Physical Science Research Council 212, 237 engineering sustainability 204–5 ENRON affair 162, 263 entropy 28, 199–201 enviro-accounting method 25 Environment Agency 89, 94, 286, 293 environmental crisis 35–6 environmental economics 7–8 environmental experience 56 environmental imperatives 34–49 environmental crisis 35–6 global warming 39–41 MMR vaccine controversy 41–2 objective harm and democratic convergence 42–8 risk, uncertainty and conflicting values 36–9 Environmental Ministry 164 environmental preference see necessity in environmental preference environmental priority strategies 25 envolve 287–9, 293

300 Index equality 156 Esty, D. 126 ethics see sustainability, ethics and marketing Europe 15, 16 automotive supply chain 236, 250 ecological modernization 36 Environment Agency 293 environmental preference 57 environmental voting 35 Green parties 149, 150, 152 local Agenda 21 288, 289, 290, 294 multilateral environmental agreements 128 Sixth Environment Action Programme 285, 286, 291 sustainability, ethics and marketing 266 European Commission 22, 292 European Community 129 DG Research 123 European Union automotive supply chain 248 engineering sustainability 176, 178 Green parties 154 local Agenda 21 286, 292, 293, 295 multilateral environmental agreements 124, 125, 127, 139, 143, 144, 145 Sixth Action Programme for the Environment 285, 286 exergoeconomics 26–7, 29 exergy 11, 26, 28, 175, 186–8, 189–92, 201–2 analysis 12–13 consumption 176 costing 29 engineering sustainability 183, 200, 203, 205, 206–7 externalities 7 ExternE 22, 23, 24, 25, 26 Eyre, N. 17, 18 Factor Four project Factor Ten 198 Falk, J.H. 56

198, 204

Faruk, A.C. 245 Fast 200 FCCC 135 FDP (party) 162–3 Federal Court of Justice 154 Feldman, L. 275 Fells, I. 192 Fine, C. 245 Finland 149 first law of thermodynamics 5, 11, 12, 16, 18, 29 engineering sustainability 184, 186–7, 189, 192, 195, 197, 200, 205 Fischer, J. 151, 157, 162, 165, 167, 168 fish populations 91–2 Fisher, D.S. 91 Fletcher, T. 103 Florida, R. 239, 245 FMD 154 Fodor, J. 57 folk psychology 72–3 Ford 236, 247, 270 Foreign Ministry 164 Forum for the Future 28–9 forward stepwise logistic regression 67 fossil fuels 11, 179–80, 186, 244, 286, 291 engineering sustainability 193, 194, 195, 198, 199, 201, 204 see also coal; gas; oil frameworks 280 France 41, 149, 150 Francis, T. 267–8 Frankland, G. 152 freedom of choice 41–2 Freeman, A.M. 104–5 Friends of the Earth 289 Gaggioli, R.A. 18, 26, 205 gas 178, 180, 189, 190, 191 Geffen, C. 239, 249 Gelman, S.A. 54 gender 56, 109, 112 General Agreement on Tariffs and Trade 126 genetic epistemology 57–61 as interactionist model 69–70

Index 301 genetically modified organizms 266 geographical information system 93 geology 89, 91 Georgescu-Roegen, N. 8, 201 German Green Party 149–69 crisis 151–3 electoral crisis 156–9 floods, war and stock market 160–2 ideology, decline of 154–6 political expectations and potentials for disappointment 153–4 political suicides 162–4 strategic professionalization 164–7 Germany 133, 191 free energy or function 203 Giddens, A. 42 global warming 39–41, 45, 180–1, 291 Golan, E. 106 Goldemberg, J. 202, 207 Goldsby, T.J. 239 Gonzalez-Benito, J. 245 goodness-of-fit statistics 67–8 Gough, S. 199 Gould, S.J. 53 Gouveia, N. 103 governance 276, 280 government level actions 285–7 government policy 124 Graedel, T.E. 13–14 Granada Television 263 green participation 143 Green Party see German Green Party green taxes 9 Greenbie, B.B. 56 greenhouse gases 40, 134, 135, 140, 180, 204 Greenpeace 257, 289 Gregory, J. 241 gross energy requirement 11, 12 Guinee, I.B. 16 Gummer, J. 5 Gupta, M.C. 239 Gysi, G. 163 habitat quality 91 habitat selection 55 Hammond, G.P. 3–30, 175–207

harm 42–8 avoidance 39, 40, 41, 42, 49 Harrison, A. 238, 245 Haynie, D.T. 203 hazards 46, 47 health status 103 Hecht, M. 56 hedonic price model 106–7 Heerwagen, J.H. 55 Heijings, R. 16 Helper, S. 239, 245, 247 Henderson, H. 270 Hertz, S. 245 Hertzog, T.R. 97 Hicksian measures 106 Hillier, W. 211–31 Hirschfeld, L.A. 54 Hitler, A. 164 Hoek, V.R. 245 Holweg, M. 237, 241, 251, 256 Honda 247 Hong Kong 130 Horlock, T.H. 195 House, M. 97 Hout, T. 238 Hülsberg, W. 151 human capital approach 104–5, 107 Hunt, A. 123–46 Hunter, A. 238 Hussein, S. 162 hydraulic oil 20 hydrofluorocarbons 134 Iceland 266 implementation 279 inclusionality 156 India 133 indirect valuation methods 108 infrastructure 124 Inhelder, B. 58 innovation 268, 279 input-output table analysis 12 inquiry process 258–9 inspiration 278–9 intangible aspects 99 integration 279 interactionist approach 70–4

302 Index interactionist explanation: Piaget’s genetic epistemology 57–61 Interbrand 267–8 interdisciplinary perspectives 3–30 cost–benefit analysis 8–10 energy analysis 11–12 energy in quantitative and qualitative terms 11 environmental economics 7–8 exergoeconomics 26–7 exergy analysis 12–13 life cycle assessment 13–16 life-cycle emissions and wastes 18–22 microeconomic analysis, limits to 6–7 monetary valuation of environmental burdens 22–6 sustainability and economic thought 10 sustainability as modern paradigm 5–6 thermodynamic approaches and limits 16–18 international development 280 International Energy Agency 176 International Federation of Institutes of Advanced Studies 12 International Institute of Applied Systems Analysis 182 International Motor Vehicle Programme 237 International Panel on Climate Change 40, 46, 143 involvement 278 Iraq 161, 162, 164, 167, 168 ISO 14001 239, 244, 246, 247 ISO 14040 14, 15, 216, 226 Italy 149, 150 Jaffe, A.B. 17, 18 Jahn, D. 35 Japan 13, 183, 188, 245, 250 Jha, V. 124, 131, 133, 134 Jina, J. 245 Johansson, P.O. 104 Johnes, P. 91

Johnson, C. 87–100 Johnson, L. 91 Johnson, N. 133 Jones, D.T. 238 Jorgensen, B.S. 8, 22, 23 just-in-time production 237, 238, 239, 246 Kane, R.P. 37 Kaplan, S. 55, 71 Kay, J.J. 203 Kazakhstan 133 Keenan, J.H. 27 Keil, F.C. 54, 57 Kelly, P. 153 Kenyon, W. 98 Kidd, P. 238 Kincaid, L.E. 245 Kitazawa, S. 239 Kitchener, R.F. 59–61 Klassen, R.D. 239 Klein, M. 151 Klein, N. 264 Kleinert, H. 151, 152 Kline, S.J. 177, 188, 200, 203 Knight, F.H. 37 knowledge, theory of 59–61 Kohl, H. 153, 154, 157 Korea 129 Kosovo war 154, 168 Kotas, T.J. 11, 186 Krueger, J. 132 Krupnick, A. 108, 140 Kuchler, F. 106 Kuhn, F. 164 Künast, R. 164 Kyoto Protocol 123, 127, 134–5, 137, 140, 143–6, 162, 293 labour market analysis 23 Lafferty, W.M. 35 Lafontaine, O. 164 Lamming, R.C. 245 land use 89, 91 landfill tax 287, 290, 294 landscape preferences and landscape characteristics 55–7, 65–9

Index 303 Latin America 125 Latour, B. 42 lean manufacturing 237, 238, 239, 245, 248 Lee, J.J. 14 Lees, C. 151, 152, 158 legibility 71 less developed countries 133 Levy, Y. 150 Liberal Democrats 165, 167, 169 life cycle assessment 5, 13–16, 18, 19, 24–5, 28, 29 automotive supply chain 237 engineering sustainability 202, 205, 207 gestation 13–14 and life-cycle design 211–12, 213, 219, 223, 225, 226–9, 231 methodology 14–16 life-cycle design and engineered timber products 211–31 life cycle assessment 226–9 objectives 212–13 oriented strand board 219–26 timber frame of Morgan Car 213–19 life-cycle emissions and wastes 18–22 likelihood ratio 67 liking/approach responses 55 Local Agenda 21 285–96 action at local level 287–9 air pollution 291 energy 290–1 government level actions 285–7 national context for local action 291–5 national and local scale actions 290 recycling 290 research, contribution of 289–90 local factors 61, 64–5, 68, 69, 70, 71, 73 local strategic partnerships 294 logistic regression model 65, 68, 69, 70 Lomborg, B. 36, 40, 156 Lovins, A.B. 198, 202, 206 Lovins, L.H. 198 Lozano, M.A. 17, 26, 27

Lucardie, P. 35 Lye, G. 269–70 Lyons, E. 56, 57 Macia, A. 56 McManus, M.C. 16, 18–19, 20–1, 24, 25 Macnaghten, P. 35 McPherson, C. 212, 214 Maddison, D. 8, 9, 22, 23, 24, 26 Magretta, M. 236 Mair, P. 150 Malaysia 129, 130, 133 management 124 Mander, V. 91 marginal costs 107 Markandya, A. 123–46 market theory, principles and function 261–2 market-based analysis 23 marketing planning 265–6 marketing see sustainability, ethics and marketing Marks & Spencer 263 Marsh, K. 51–81 Maxwell, J. 239, 245 May, Lord R. 180 Meadowcroft, J. 35 media ethics 280 Medland, A.J. 212 methodological approach 99 microeconomic analysis, limits to 6–7 Middle East 161, 162, 178 Miemczyk, J. 235–52 Milborrow, I. 124, 127–9 Miller, P. 56 mineral and rapeseed oil 19, 24, 25 Ministry for Consumer Protection, Food and Agriculture 164 MMR vaccine controversy 39, 41–2 modularity thesis 57–8 Molloy, E. 20 monetary valuation of environmental burdens 22–6 Montreal Protocol 123, 127–31, 134–6, 141, 143–6, 285–6 Moore, A. 34–49

304 Index mortality see willingness to pay, mortality and air pollution in Brazil Mueller, R.F. 28, 176, 178, 199 Müller-Rommel, F. 150, 153 multilateral environmental agreements see trade, environment and multilateral environmental agreements multiple-pathway method 25 Munby, D.L. 9 Murphy, D. 151 Murphy, P.R. 239, 244 Murphy, R.J. 211–31 mystery 71 Nakicenovic, N. 182 Namibia 133 National Association of Farmers’ Markets 288 Natural Environment Research Council 180 Natural Resources and Environment Foresight Panel 183 Natural Step system 6, 182, 199, 204 necessity in environmental preference in Thailand 51–83 analysis 64–5 biophilia: innate preferences 54–5 interactionist explanation: Piaget’s genetic epistemology 57–61 landscape characteristics 68–9 landscape preferences and landscape characteristics 65–8 landscape preferences, local influences on 55–7 Piaget: genetic epistemology as interactionist model 69–70 predictor variables 64 social scientific methods and interactionism 70–4 stimulus and response format 63–4 subjects 62–3 neomaterialism 155 net energy analysis 184 net present value 9 Netherlands 150, 191, 217, 293 Energy Study Centre 201

new product development 269–71 Nike 264 Nishimura, T. 220–2 Nissan 236 non-consumptive aspects 99 non-governmental organizations 137 non-violence 155 North America 15, 26, 57 see also Canada; United States North American Free Trade Agreement 124 North Atlantic Treaty Organization 154 Ntaxa 89, 91, 92, 94 nuclear power 180, 181, 190, 201, 204, 205 O’Callaghan, P.W. 190, 192, 198 oil 178, 180, 184 Oil Producing and Exporting Countries 178 optical eyewear 235 ordinary least squares regression 91 Organisation for Economic Co-operation and Development 128, 129, 144, 180, 182 Orians, G.H. 55 Ortiz, R.A. 102–19 ozone-depleting substances 127, 128, 129, 130, 131, 134 pacifism, radical 155 paintshop impacts 239 ‘Paradox in Marketing’ 257, 259 paradoxes, development of 260–1 Parkin, S. 5, 6, 28, 176, 177, 178, 199, 202, 204–5 PDS (party) 162–3 Pearce, D.W. 22 Peirson, G. 97 Pereira, L.A.A. 103 Perrings, S.C. 8 personal computers 235 Philippines 125, 133 photography 235

Index 305 Piaget 57–61 genetic epistemology as interactionist model 69–70 Pierce 200 Pil, F. 237 Pinker, S. 52 PIU team 17 place of residence 56 PM10s 23 Poguntke, T. 152, 160 Poland 125, 133 political economy 139–45 pollutant emissions 180–1 pollution havens 130, 133–4 pollution prevention 248 Popper, K. 200 Porritt, J. 6, 28, 178, 179, 180, 183, 199, 202, 204 Portney, P.R. 140 predictor variables 64 preference determination 71 pricing 269–71 primary energy 185 prioritization phase 229 Probst, L. 151 process analysis 12 production 124 professional practice 280 psycho-spiritual value 97–8 qualitative valuation 98, 99 quick response 237, 238 random utility model 94 Rant, Z. 13 Raschke, J. 151, 152, 158–9 RecommIT 294 recycling 286, 287, 288, 290, 291, 294 Reddy, S. 42 reference condition 188 regional projects 280 regression analysis 65, 68, 69, 70, 112, 128 Reistad, G.M. 188, 192–3, 205 relationships 268, 280 Renault 236 Renn, O. 36 Repetto, R. 125

reputation 263–5, 268, 276, 280 research 265–6 resource and environmental profile analyis 14 resource flows 201–2 responsiveness 235–6, 237, 240, 243, 247, 250, 251, 252 revealed preference techniques 108 Rice, G. 16 rights 44–5 ‘Rio + 10’ conference (Johannesburg) 285 Rio Earth Summit 4 risk 36–9, 45, 46, 47, 48, 49, 251, 276 reductions, small 104–8 river quality: ecological and economic approach 87–100 catchment impacts on river 89–91 river quality and angling 92–8 river quality and fish populations 91–2 RIVPACS scheme 89–90 Robèrt, K.-H. 6, 179 Roberts, F. 11, 12 Roose, J. 161 Rosen, M.A. 29, 187, 188, 189–90, 193, 201, 202 Rosenberg, A. 72–3 Roth, C. 164 Roth, R. 151, 152, 153, 168 Rothenberg, S. 239, 245, 249 Rover 247 Royal Commission on Environmental Pollution 181, 182–3, 204, 206 Rucht, D. 161 Rüdig, W. 151, 154 Russia 133, 178 Rutz, M. 56 Sako, M. 245 Saldiva, P.H.N. 102–3 Salisbury, D. 41 Sarkis, J. 236, 239 Satterfield, T. 98 Saward, M. 42, 44–5, 46, 48 Scharf, T. 152 Schmidt, H. 157 Schneider, E.D. 203 Schoonmaker, D. 152

306 Index Schröder, G. 150, 152, 156–7, 162, 164, 165, 167, 168 Sciubba, E. 29, 202 Scott, W. 199 second law of thermodynamics 5, 11, 12–13, 16, 26, 29, 175, 176, 186 engineering sustainability 183, 189–90, 192–4, 197, 199–201, 205–6 Seeley, C. 256–81 sensitivity analysis 19, 20 service value 97–8, 99 Shahin, M. 126 Shepard, D.S. 104 SimaPro 4.0 16 Simon, J. 36 Singapore 129 Sixth Environment Action Programme 285, 286, 291 Slesser, M. 11, 12, 185, 186, 201 Snow, C.P. 52 Social Democratic Party (SPD) 150, 153, 156, 158, 162–6, 168–9 Social Democrats 153, 156–7, 159, 164, 165, 167 social justice 155, 165 social organization 124 social scientific methods and interactionism 70–4 societal differentiation 155 Society of Environmental Toxicology and Chemistry 14–15, 216 Society for the Promotion of Life-Cycle Development 21 socio-economic characteristics 106 SOFA 294 Sollner, F. 200, 201 source reduction 248 spatial analysis 98 Spearman’s correlation test 65, 68, 69 speed 236 Sperber, D. 54 Spong, K. 218 Spring, M. 245 Spurgeon, C. 97 stakeholder analysis 136–9, 141 Stalk, G. 238

standards 280 Stank, T.P. 239 Stapleton, A.J. 177, 183, 184, 187, 188, 189, 191, 192, 193, 194, 195, 197–8, 202, 205, 206 interdisciplinary perspectives 4, 12–13, 16–17, 29 statistical analysis 12 Stavins, R.N. 17, 18 steady-flow energy equation 184 stimulus and response format 63–4 Stirling, A. 8, 9–10, 22, 23, 26 Ströbele, C. 159 supplier coordination 239 supplier environmental quality improvement 239 supply chain management 237, 238 Suri, R. 238 sustainability 165, 205–7 and economic thought 10 in international dimension 207 as modern paradigm 5–6 Venn diagram 177 see also sustainability, ethics and marketing sustainability, ethics and marketing 256–82 communications and e-marketing 271–3 further research, parameters for 278 implementation 279 innovation 279 inquiry process 258–9 inspiration 278–9 integration 279 involvement 278 market theory, principles and function 261–2 marketing planning, research and buyer behaviour 265–6 marketing profession, codes and ethics in training 273–6 new product development, distribution and pricing 269–71 paradoxes, development of 260–1 reputation, trust and brands 263–5 research conclusions 276–8

Index 307 research project agenda, ongoing 279–80 social, green and cause-related marketing 266–8 Sustainable Development Commission 176 sustainable development and energy sector 178–83 Svensson, G. 245 Sweden 13, 25, 188, 293 system conditions 6, 179 Szargut, J. 11, 29, 186, 192, 193, 201, 202 Szilard, L. 200 tariff removal 125 Taylor, T. 123–46 technology 124 Tellus Institute method 25 Thailand 130, 133–4, 136 see also necessity in environmental preference in Thailand thermodynamics and energy systems 16–18, 175–207 cogeneration plant/combined heat and power schemes 195–7 ecology and free energy 203 electricity generation, central-station 192–5 energy analysis 183–6 energy productivity improvement 197–8 engineering sustainability 204–5 entropy law 200–1 exergy 186–8, 189–92 issues 176–8 resource flows and exergy 201–2 sustainability 205–7 sustainable development and energy sector 178–83 thermodynamics, analogy and metaphor 199–200 see also first law of thermodynamics; second law of thermodynamics 3DayCar Programme 236 Thring, M.W. 178 timber products sees life-cycle design and engineered timber products time-based competition 237

TNS system conditions 199 tools 280 total quality management 239 TQEM 248 trade, environment and multilateral environmental agreements 123–46 Basel Convention 132–4, 136 Convention on International Trade in Endangered Species 131–2, 136 Kyoto Protocol 134–5 Montreal Protocol 127–31, 135 political economy 139–45 stakeholder analysis 136–9 trade liberalization 124–5 training 273–6 transport 124, 288, 291, 293 Transport and Environment Reporting Mechanism 293 travel cost method 87–8, 92, 94, 95, 99 trust 263–5 Tsatsaronis, G. 26, 27 Turkey 13, 129, 154, 188 Turnbull estimation 112, 113, 115, 117, 118 2-log likelihood statistic 68 Ukraine 133 Ulrich, R.S. 55, 57, 72 uncertainty 36–9, 49 United Kingdom 13 automotive supply chain 236, 243, 246, 247, 250 Energy Review 17 energy sector 3, 16–17, 175, 181 energy system 5 Engineering and Physical Sciences Research Council 30, 237 engineering sustainability 182, 183, 188, 189, 192, 193, 194, 195, 198, 204, 206, 207 Environment Agency 286 Foresight Programme 198 government departments 11

308 Index United Kingdom – continued life-cycle design 217 Local Agenda 21 285, 293 multilateral environmental agreements 127, 128 Natural Environment Research Council 180 neoliberalism 167 river quality valuation 89 sustainability, ethics and marketing 257, 261, 262, 266, 276 Sustainable Development Commission 176 United Nations 161 Development Programme 125, 273 Environment and Development 285 UNCTAD 125 UNFCC 137, 138 United States 13, 14, 154, 162, 167 automotive supply chain 245, 250 Department of Energy 22 engineering sustainability 193, 195 multilateral environmental agreements 132–3, 139, 143, 144 universal factors 61, 64–5, 68, 69, 70, 71, 73 Urry, J. 35 Valero, A. 17, 26, 27 valuation methods 5 value conflicting 36–9 intangible 268, 280 pluralism 39, 44, 155 of a statistical life 23, 104 utility-based 97–8 well-being based 97–8, 99 van Gool, W. 13, 187, 189, 190, 191, 193, 198, 201 vehicle painting 245 Volvo 236 Von Weizsäcker, E. 198 Voss, C. 240

Wall, G. 29, 188, 193 waste levels 239 waste reduction and prevention 239 water quality 286 way-finding 55 welfare system 167 Werkgroup-2000 239 Weyant, J.P. 140 Wheeler, D. 125 Whybark, D.C. 239 Wiesendahl, E. 155 Wightman, P.S. 22, 24, 25, 26 Willig, J.T. 239 willingness to pay 8, 23 willingness to pay, mortality and air pollution in Brazil 102–10 sample, descriptive analysis of 111–18 small risk reductions to human life, evaluation of 104–8 survey 108–11 Wilson, E.O. 52, 54 wind farms 206 Winhold, M. 26, 27 Winnett, A. 3–30 Wisenthal, H. 152 Wissenburg, M. 35, 150 Womack, J. 238 Wood, A. 238 World Commission on Environment and Development 5, 178 World Energy Council 182 World Health Organization 41 World Summit on Sustainable Development 4, 5 World Trade Organization 126, 135, 139, 145 Woverreit, K. 163 Wright, R. 264, 266 Wynne, B. 42 Yin, R.K. 240 Zeckhauser, R.J. 104 Zimbabwe 131–2, 136 Zube, E.H. 56 Zuckerman, M. 56

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