Nick Ashford: Technology, Globalization and Sustainable Development: Transforming the Industrial State

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Presentation at the STEPS Conference 2010 - Pathways to Sustainability: Agendas for a new politics of environment, development and social justice

http://www.steps-centre.org/events/stepsconference2010.html

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Nick Ashford: Technology, Globalization and Sustainable Development: Transforming the Industrial State

  1. 1. TECHNOLOGY, GLOBALIZATION AND SUSTAINABLE DEVELOPMENT: Transforming the Industrial State Nicholas A. Ashford Professor of Technology & Policy Massachusetts Institute of Technology Copyright © 2010 Nicholas A. Ashford
  2. 3. MAJOR SYSTEMIC PROBLEMS <ul><li>Fragmentation of the knowledge base </li></ul><ul><li>Inequality of access to economic & political power </li></ul><ul><li>Tendency towards ‘Gerontocracy’ </li></ul><ul><ul><li>technological and political ‘lock-in’ </li></ul></ul><ul><ul><li>usually, but not always, accompanied by concentration of economic and political power </li></ul></ul><ul><li>Market imperfections -- prices don’t reflect real costs of goods and services </li></ul><ul><li>Limitations of perfectly-working markets </li></ul><ul><ul><li>Disparate time horizons - costs now, benefits later </li></ul></ul><ul><ul><li>Delay in recognizing problems (Limits to Growth) </li></ul></ul><ul><ul><li>Inappropriate production & consumption patterns </li></ul></ul><ul><li>Failure to engage individuals in the society to realize their human potential ~ social exclusion </li></ul><ul><li>Corruption </li></ul>
  3. 4. Drivers of Economic Growth <ul><li>Technological Innovation (Schumpeter’s ‘waves of creative destruction’) </li></ul><ul><ul><li>exploiting innovative potential </li></ul></ul><ul><li>Trade (Ricardo’s theory of comparative advantage) </li></ul><ul><ul><li>exploiting excess capacity </li></ul></ul>
  4. 5. Technological change and globalization (trade) as drivers of change within and between three operationally-important dimensions of sustainability Environment Technological change & globalization (trade) Work Economy Copyright © 2006 by Nicholas A. Ashford.
  5. 6. The Efficient Frontier for Current and Future Technology Contrasting Sustaining and Disrupting Innovation Cost Performance Current Existing Technology Future Technology (Disrupting Innovation) C 1 A B C C 2 P 1 P 2 Sustaining Innovation New Sustaining Technology
  6. 7. The Importance of Work and the Workplace <ul><li>Work is combined with physical and natural capital to produce goods & services. </li></ul><ul><li>The workplace is the place where comparative advantage is exchanged - i.e., a marketplace. </li></ul><ul><li>Work is the main means of distributing wealth and creating purchasing power. </li></ul><ul><li>Work provides a means of engagement in the society. </li></ul><ul><li>The workplace provides an important social environment and mechanism for enhancing self esteem. </li></ul><ul><li>Industrial & economic policy, trade policy, and environmental policy have important consequences for employment and OH&S </li></ul>
  7. 8. Theoretical implications of decreasing labor content for employment and for the environment <ul><li>Lower costs of goods and services </li></ul><ul><li>Lower prices </li></ul><ul><li>Increased demand and sale of goods and services </li></ul><ul><ul><li>in the original industry/market </li></ul></ul><ul><ul><li>in new markets (influenced by increases in disposable income and producer-created demand) </li></ul></ul><ul><li>Are more workers hired than displaced? </li></ul><ul><ul><li>It depends on whether growth in production outstrips (capital) productiveness growth </li></ul></ul><ul><li>May require or stimulate a continual throughput economy with increasing consumption </li></ul><ul><ul><li>=> adverse effects on environmental sustainability </li></ul></ul>
  8. 9. Improving labor Productivity <ul><li>increase worker skills </li></ul><ul><ul><li>increase labor productiveness </li></ul></ul><ul><ul><li>rewards to workers are increased </li></ul></ul><ul><li>use/develop better hardware, software, and manufacturing systems </li></ul><ul><ul><li>increase capital productiveness </li></ul></ul><ul><ul><li>workers’ share of profits are decreased </li></ul></ul><ul><li>better matching of labor with natural/physical capital, and with information & communication systems </li></ul><ul><ul><li>increase joint labor and capital productiveness </li></ul></ul><ul><ul><li>rewards are increased for both owners and workers </li></ul></ul><ul><ul><li>human-centered knowledge-based work has the potential, if designed properly </li></ul></ul>
  9. 10. III IV V Environment Technological change & globalization Work Economy Toxic Pollution Climate Change Ecosystem Disruption Resource Depletion ● Skills ● Wages ● Purchasing Power ● Job Security ● Health and Safety ● Job Satisfaction ● Number of Jobs ● Changing international division of labor ● Changes in the nature of work ● Development & environment (industrialization) ● Investment & environment ● Trade & environment ● Improvements in competitiveness, productiveness, and the use of physical, natural, & human capital ● Economic changes (arising from labor replacement & capital relocation ● Financing growth and development ● Increased environmental footprint from the need to increase employment & industrial throughput I II VI ● Regulation of Health, Safety & Environment Affects the Economy and Growth. ● Environmental/energy improvements create or change the nature of employment.
  10. 11. TRANSFORMATION PROCESSES REQUIRE <ul><li>● trans-disciplinary expertise </li></ul><ul><li>● the emergence of new ways to meet the basic needs of the society, </li></ul><ul><li>● re-conceptualizing the basis of the economy </li></ul><ul><li>● the avoidance of agenda and pathway capture or lock-in by incumbent actors and ideology </li></ul><ul><li>● technological displacement and substitution of new for old technology </li></ul><ul><li>● in some cases, the displacement of not only the dominant products and technologies, but also the incumbent firms and public institutions </li></ul><ul><li>● co-optimization: co-evolution of technological and social systems, institutions  complementary and mutually-reinforcing technological, organizational, institutional, and social innovations </li></ul><ul><li>● system changes that cut across problem areas -- competitiveness, environment, and employment -- and therefore also cut across sectors and firm divisions, as well as government departments and missions. </li></ul>
  11. 12. Environmental Justice Climate Change Economic Inequality Competitiveness (effective and efficient delivery of goods and services) Employment Resource Depletion Biodiversity/ Ecosystems DOE DOD/ DHS DOL/ ED USDA DOC DOC Economic Development Social Development Environmental Protection Toxic Pollution Government activity areas Key: Challenges confronting sustainable development Peace and Security Employment Transportation Energy Defense Manufacturing Housing and Urban Dev. Health and Environment Agriculture Purchasing Power (job creation) & HHS/EPA HUD

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