scholarly journals Decoupling Economic Development from the Consumption of Finite Resources Using Circular Economy. A Model for Developing Countries

2020 ◽  
Vol 12 (4) ◽  
pp. 1291 ◽  
Author(s):  
Carlos Scheel ◽  
Eduardo Aguiñaga ◽  
Bernardo Bello

Sustainable development is a major concern for developing and developed economies as economic growth has to led to scarcer and more expensive resources. Although countries have established public policies focusing on resource and energy efficiency, there is an increasing need for a coordinated industrial strategy able to create sustainable wealth through a holistic management of natural resources, capable of “decoupling” economic growth from resource extraction and natural deterioration. Consequently, the objective of the present research is to develop a decoupling model able to create increasing economic returns, reducing the social gap and regenerating the natural capital for regions in developing countries. Departing from a literature review on peer reviewed articles on successful industrial cases of decoupling around the world, we contrasted the linear production model with the United Nations Environment Program (UNEP)’s current four decoupling indicators in order to propose a more robust model. The result was an eight-factor decoupling model that used a well-supported framework for sustainable wealth creation named “circular value ecosystem” (CVES). By using system dynamics, we deployed the proposed framework using system dynamics modeling in order to improve the understanding of our proposal. We found that this model, with the proper regional conditions in developing countries, can: (1) reduce, through substitution, the consumption of natural resources; (2) produce alternative economic increasing returns; (3) reduce the negative environmental impacts; and (4) create self-sustainable wealth for the economy, the environment, and the social development of most stakeholders of these regions. Decoupling economic growth represents a complex and challenging task whose successful implementation can only be achieved if managed at a regional level with a systemic approach.

2014 ◽  
Vol 14 (6) ◽  
pp. 1057-1066 ◽  
Author(s):  
Ying Xie ◽  
Xuyong Li ◽  
Chunsheng Yang ◽  
Yang Yu

Water shortage is a major problem in northern China, because of a huge population and rapid economic growth. Taking the Luanhe River Basin (LRB) as a study area, we set up a System Dynamics (SD) model of the basin for the period 2005–2010, and considered various important socioeconomic and environmental factors and their correlation. Significant trends for the period 2011–2030 were simulated and the water resource carrying capacity (WRCC) of the LRB and its trends over the next 30 years were analyzed. The results indicate a decreasing trend of WRCC in the basin and that current economic growth is not sustainable. The study investigated possible optimized allocation projects. The most apt project would involve a combination of strategies that could considerably increase the WRCC, reduce demand, and improve water quality.


2007 ◽  
Vol 46 (4II) ◽  
pp. 579-596
Author(s):  
Seeme Mallick

Production and consumption activities in any economy have a direct impact on the environment. Although increased economic activity and population growth in developing countries continue to exert enormous pressure on their natural environments, the role of the environment is neglected in the estimation of national income. Such neglect at the macroeconomic level is at least in part, an important cause of environmental degradation in developing countries. Since the United Nations Conference on Environment and Development in 1992 at Rio and even as early as middle of the 1980s, a substantial literature had developed on methods to integrate the environment into the economic development process. The main assertion in this literature is that natural resources represent a form of capital that is analogous to the stock of manufactured capital. Sustainable income can be determined by allocating a portion of income to allow for the deprecation of natural capital [Ahmed, El Serafy, and Lutz (1989) and Solow (1992)]. Indonesia had average real GDP growth rates of more than five percent per year up to the early 1990s [World Bank (1994)]. But income inequality (measured by the Gini coefficient) has been high. Although inequality continues to be quite high, especially between rural and urban populations, Indonesia has been successful in poverty alleviation up to mid 1990s. In 1976 almost 40 percent of its population was below the poverty line, which in 1993 decreased to less than 14 percent [Todaro (1994)]. Income distributional consequences of economic growth would continue to be one of the main policy issues in Indonesia. This is due to its large population size, presence of different ethnic and religious groups, large diversity between rural and urban groups, variety of natural resources scattered over the country, huge distances and the effects of a far-flung archipelago [Akita, Lukman, and Yamada (1999)].


2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Galina N. Semenova ◽  
Elena I. Larionova ◽  
Oleg G. Karpovich ◽  
Sergei V. Shkodinsky ◽  
Fatima M. Ouroumova

PurposeThe purpose of the work consists in studying social integration as a factor of economic growth. The authors focus on experience and perspectives of developing countries, as they show the highest rate of economic growth and have high potential of its acceleration.Design/methodology/approachThe authors determine the interconnection between the processes of social integration in the four distinguished manifestations with the help of regression analysis and determine the level of homogeneity of data selections for each studied indicator with the help of variation analysis. Scenario analysis of future perspectives of the change of economic growth depending on the influence of the factor of social integration in the unity of its distinguished types is performed. Monte Carlo method is used for forecasting of change of the values of indicators of social integration.FindingsIt is substantiated that social integration is an important factor of economic growth. At the same time, the influence of this factor on economic growth of developing countries is ambiguous. Due to the offered proprietary classification of social integration according to the criterion of involved subjects, it is possible to establish that such types of social integration as integration of social groups, integration of business and society and integration of state and society have a positive influence. However, individual's integration into society has a negative influence.Originality/valueThe research contributes to development of economics by substantiating the significance of the social integration factor for economic growth and specifies the logic of management of this factor, which should be flexible. The perspectives of developing countries in acceleration of the rate of economic growth based on managing the factor of social integration are rather wide and envisage the increase of society's inclusion and the level of consumer consciousness and more active involvement of population into state management in the digital economy.


2020 ◽  
Vol 26 ◽  
pp. 105-133
Author(s):  
Marthán Theart ◽  
Kirstin Meiring

Small and Medium Enterprises (SMEs) play a significant role in the economy of developing countries. Although SMEs contribute to economic growth, they still struggle with access to finance and cash flow constraints. The coronavirus (COVID-19) pandemic worsened this situation, making it necessary for countries to develop rescue regimes suitable for financially distressed SMEs. Focusing on Nigeria and Kenya – which represent the largest economies in West Africa and East Africa respectively – this paper critically sheds light on the socio-legal challenges posed by extant insolvency law regimes in both countries and their unsuitability for driving SME rescue. As a conversation starter in the African context, the authors identify transplanted concepts and structures which make SME rescue a futility, in the light of local circumstances, while proposing solutions tailored to the social milieu of both countries.


2010 ◽  
Vol 7 (1) ◽  
pp. 77-104 ◽  
Author(s):  
TADE O. OKEDIJI

Abstract:This paper proposes a composite measure of ethnic fragmentation, the Social Diversity Index (SDI) to capture inherent multidimensionality not captured in the prevalent Ethno-Linguistic Fractionalization Index (ELF). The SDI more accurately demonstrates the direct effects of hidden diversity values and the extent and corresponding costs of ethnic diversity on economic growth. A comparative empirical analysis of the results from 132 countries employing the SDI and the ELF Index, suggests that the SDI is more robustly correlated with growth, and does a moderately better job of explaining the effect of exogenous static ethnic diversity. However, the empirical effects of ethnic diversity on growth tend to diminish with the inclusion of additional macroeconomic variables.


2015 ◽  
Vol 28 ◽  
pp. 330-340 ◽  
Author(s):  
Wawan Rusiawan ◽  
Prijono Tjiptoherijanto ◽  
Emirhadi Suganda ◽  
Linda Darmajanti

2007 ◽  
Vol 46 (4II) ◽  
pp. 883-894 ◽  
Author(s):  
Saima Akhtar Qureshi ◽  
Muhammad Khan ◽  
Muhammad Iftikhar Ul Husnain

Both human and natural environment are interlinked with each other dynamically and keep this relation stable within themselves and with each other. The existence of all living organism including human being depends on the interlinkages between the physical human environment and natural environment. Natural resources and physical environment form a basis for sustainable livelihood system, in which human needs are met in the short and long run [Dankelman (2001)]. Although economic growth is an explicit goal in nearly every nation, but a wide range of independent scientific research provides undeniable evidence that the growth of the global economy is not sustainable because it consumes many of the environmental services that strengthen the production of goods and services [e.g., Houghton, et al. (1996); Vitousek, et al. (1997)]. Environmental services refer to the various ways that the environment influences production- and indeed-supports most part of human existence [Costanza and Daly (1992)]. There is a growing understanding that the degradation of environment and growth of waste materials can reduce the productivity of natural resources, as when ozone accumulates in the troposphere and lowers crop yields. This increases the quantity of human capital required to produce a specified quantity of food. The addition of wastes also slows the rate at which natural capital can process the waste material, as when sewage reduces the ability of aquatic ecosystems to process organic materials [Ayres (1996)]. There is also an increasing understanding that “economic growth does not necessarily go hand-in-hand with growth in the well-being of people”. It reflects the rising discrepancy between rich and poor and between genders in most countries [Ayres (1996)].


2021 ◽  
Vol 5 (11) ◽  
pp. 103-111
Author(s):  
Alexey I. Andreev ◽  
◽  
Maria S. Varenik ◽  
Dmitry V. Ivanov ◽  
◽  
...  

Youth are the backbone of innovative country and global development. Currently, developed and many developing countries have gone through a demographic transition. As a result, the number of young people is decreasing and the proportion of older people is increasing. At the same time, similar processes are taking place with the social stratum of "innovators", which includes scientists. This circumstance may lead to a long-term and difficult-to-overcome slowdown in economic growth, which Russia and other countries, and possibly the entire global world, have faced. For Russia, the set of solutions to the problem should lie in the plane of increasing the effectiveness of state youth policy by consolidating and strategizing its management in all spheres and industries.


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