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2. a commentary on consumption by chandra bhushan

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at the 6th International Symposium for Future Earth in Asia: Sustainable Consumption in Asia
15 January 2018, Kyoto

Published in: Environment
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2. a commentary on consumption by chandra bhushan

  1. 1. DRAFT PAPER NOT FOR CITATION A commentary on consumption Rich Indians vs. Rich (poor) Americans CHANDRA BHUSHAN CENTRE FOR SCIENCE AND ENVIRONMENT, INDIA
  2. 2. DRAFT PAPER NOT FOR CITATION ASSESSING CLIMATE POLICY & PERFORMANCE OF THE UNITED STATES
  3. 3. DRAFT PAPER NOT FOR CITATION EFFICIENCY IS NOT SUFFICIENCY Transport – More miles travelled
  4. 4. DRAFT PAPER NOT FOR CITATION EFFICIENCY IS NOT SUFFICIENCY Housing – Gargantuan electricity consumption
  5. 5. DRAFT PAPER NOT FOR CITATION EFFICIENCY IS NOT SUFFICIENCY Housing– Bigger houses
  6. 6. DRAFT PAPER NOT FOR CITATION EFFICIENCY IS NOT SUFFICIENCY Housing– Size increasing
  7. 7. DRAFT PAPER NOT FOR CITATION EFFICIENCY IS NOT SUFFICIENCY Housing – More appliances
  8. 8. DRAFT PAPER NOT FOR CITATION EMISSIONS LINKED WITH CONSUMPTION Changes reflecting the trend in GDP
  9. 9. DRAFT PAPER NOT FOR CITATION ULTIMATE WIN-WIN ØPolicies in the US directed towards efficiency. Consumption is non-negotiable. ØUS wants the ultimate win-win — consume but not pollute. ØThis is not possible. ØThe US will require policy to moderate consumption if it wants to reduce emissions significantly.
  10. 10. DRAFT PAPER NOT FOR CITATION FAIT-ACCOMPLI? ØMixed response to our report. Agreement, shock, anger and advice. ØMany Americans believed that technology will solve the problem of climate change ØMany wrote to us about the the burgeoning consumption by the rich in the developing countries. ØMessage: Consumption in the developed countries is a fait- accompli. We need to control consumption in the developing countries. ØDecided to study consumption of the ‘Rich’ in India.
  11. 11. DRAFT PAPER NOT FOR CITATION DISCLAIMER ØI do not support obscene consumption either in the North or the South ØI do support and propagate the view that there is a level of consumption that is required to meet the basic development needs of everyone in the world. We need to broadly define this ‘basic consumption’. ØThe theme of the current report is to judge how obscene is the rising consumption of the rich in the developing countries compared to the rich in the developed country.
  12. 12. DRAFT PAPER NOT FOR CITATION DATA SET ØAll comparison for the year 2011-12. ØConsumer expenditure survey: The US Bureau of Labour Statistics conducts annual consumer expenditure survey. In India, National Sample Survey Organisation (NSSO) conducts decadal consumer expenditure survey. The last survey was done in 2011-12. ØPrivate consumption expenditure published as part of National Accounts each year. Bureau of Economic Analysis (BEA) in the US and the Ministry of Statistics and Programme Implementation (MOSPI) in India publish annual data on total private consumption in a country under different categories of goods and services. ØFor comparison, Indian Rupees converted US dollar both in terms of Market Exchange Rate (MER) and Purchasing power parity (PPP) ØClassification of goods and services was harmonised. Some category eliminated if identical data was not available. For instance, expenditure under personal insurance and pensions, cash contribution, personal tax and gifts of goods and services have been excluded. This is because the Indian consumption data do not capture these.
  13. 13. DRAFT PAPER NOT FOR CITATION AVERAGE CONSUMPTION Based on annual private consumption expenditure published as part of National Accounts
  14. 14. DRAFT PAPER NOT FOR CITATION THE RICHEST INDIANS vs. THE RICH (POOR) AMERICANS Based on consumer expenditure survey ØNSSO classifies households under different fractile class. The top 5 per cent of urban households or the Urban 12th fractile class, is the richest class in India. ØConsumer expenditure survey in the US divides the households into five quintiles of income before taxes -- lowest 20 per cent, second 20 per cent, third 20 per cent, fourth 20 per cent and the highest 20 per cent. ØWe compare the Urban 12th fractile class of India with average American expenditure, with expenditure of lowest 20 per cent quintile and the highest 20 per cent quintile.
  15. 15. DRAFT PAPER NOT FOR CITATION THE RICHEST INDIANS vs. THE RICH (POOR) AMERICANS Average annual per capita expenditures on major goods and services (in $US-MER)
  16. 16. DRAFT PAPER NOT FOR CITATION THE RICHEST INDIANS vs. THE RICH (POOR) AMERICANS Average annual per capita expenditures on major goods and services (in $US-PPP)
  17. 17. DRAFT PAPER NOT FOR CITATION THE RICHEST INDIANS vs. THE RICH (POOR) AMERICANS Per capita expenditure on energy goods and services (in $US-MER) ØIn 2014, the average pump price for gasoline in India was US$ 1.10 compared to US$ 0.76 in the US. ØResidential electricity prices in India for high- end consumers (households consuming more than 300-400 kWh/ month) is comparable and in some cities even higher than the the US
  18. 18. DRAFT PAPER NOT FOR CITATION THE RICHEST INDIANS vs. THE RICH (POOR) AMERICANS Per capita CO2 emissions (MT/annum) ØMethodology by Eric Kemp-Benedict and colleagues at the Stockholm Environment Institute in preparing the Greenhouse Development Rights Framework ØData on national income distributions published by the World Bank as part of its World Development Indicators (WDI) database
  19. 19. DRAFT PAPER NOT FOR CITATION CONCLUSION ØThe consumption and emissions of the developed countries is far higher than those of the ‘rich’ in the developing countries. ØThis is not an argument in support of increasing the consumption of the ‘rich’ in the developing countries. Rather the argument is to: vSeriously reduce consumption in the developed countries vPut policies in place to moderate the growing consumption in the developing countries vStart serious debate ‘how much consumption is enough’!
  20. 20. DRAFT PAPER NOT FOR CITATION CONCLUSION ØGoal 12 of SDGs: Ensure sustainable consumption and production patterns ØDefinition: “Sustainable consumption and production is about promoting resource and energy efficiency, sustainable infrastructure, and providing access to basic services, green and decent jobs and a better quality of life for all”. ØNowhere is this definition, the issue of ‘sufficiency’ and ‘limits to consumption’ has been addressed ØThe learning of Capitan America is clear: We cannot have an ultimate win-win. Efficiency is not sufficiency.

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