1) While human development has achieved impressive gains in areas like life expectancy and reduced child mortality, billions still live in poverty and inequality remains high globally. 2) Current patterns of high consumption, population growth, and debt-driven economic growth are unsustainable and could compromise the needs and resources of future generations if unchanged. 3) Strong sustainability requires maintaining total capital stocks, as individual forms of capital like natural, social and economic resources are interdependent and not easily substitutable in the long-run.

1. How Sustainable is Development of
Human?
The story with figures.
Andrey Ivanov, Regional Human Development Advisor
Mihail Peleah, Human Development Programme and
Research Officer
UNDP Bratislava Regional Center

3. Oh, really?!
“The [American]
nation is
marching along a
permanently high
plateau of
prosperity.”
Yale University economist Mother of seven children, 1936
Irving Fisher, 1929

4. Looking back
into the last 50-60 years
• Impressive achievements…
– Between 1960 and 2009 life expectancy increased by one-
third
– Mortality rates for children under five were more than
halved.
– The share of illiterate people was almost halved
• But
– Although in 2005 more than 1,372 million people still lived
on less than 1.25$ per day
– World Gini ~ 0.7  the country “World” is highest
inequality in the World

5. Child mortality ratio,
1970-2009
250
200
East Asia & Pacific
150
Europe & Central Asia
Latin America & Caribbean
100 Middle East & North Africa
Sub-Saharan Africa (all income
levels)
South Asia
50
World total
0
1970 1975 1980 1985 1990 1995 2000 2005 2006 2007 2008 2009

6. Life expectancy dynamics,
1960-2009
80.0
75.0
70.0 East Asia & Pacific
65.0
60.0 Latin America &
Caribbean
55.0
50.0 Middle East & North
Africa
45.0
40.0 Sub-Saharan Africa
(all income levels)
35.0
30.0 World total
82
85
91
94
00
03
09
60
75
88
97
06
19
19
19
19
19
19
19
19
20
20
20
20

7. Excessive inequality is bad for
development
Slovakia Netherlands
Ukraine
USA
Turkey
Nigeria

8. Going further back in time
Life expectancy at birth, men
80
USSR
70
Great Britain
60 USA
50 Germany
50 years
40
60 years
30
20
1840s 1870s 1880s 1890s 1900s 1920s 1930s 1950s 1960s 1970s 1980s

9. The World is marching along a
permanently high plateau of prosperity… Is
it?

10. The cliff of sustainability
• Brundtland’s Commission Definition:
Development, that meets the needs of the present
without compromising the ability of future
generations to meet their own needs.
• Two key concepts:
– 'needs', in particular the essential needs of the world's
poor (overriding priority); and
– limitations imposed by the state of technology and social
organization on the environment's ability to meet present
and future needs.

11. Weak sustainability
Economic Social Natural
capital + capital + capital
Wellbeing
• maintaining a certain minimum of every
form of capital
– assumption: individual forms of capital are not
necessarily substitutable; more probably they
are complementary

12. Strong sustainability
Economic Social Natural
capital capital capital
Wellbeing Wellbeing Wellbeing
• maintaining a certain minimum of total
capital regardless of the ratios of individual
forms of capital
– assumption: individual forms of capital are
substitutable (within practical range)

13. The Carrying-Capacity Approach
Natural Economy
Natural
environment and
environment
Society
What is the optimal scale of the macro economy
relative to the environment? Another definition of SD:
“to increase the quality of human life without
overstepping the carrying capacity of supporting
ecosystems”. (IUCN et al., 1991)

14. Current background
World population: 7 billion today; predicted to reach 9 bn by 2050

15. 15
If we keep current production & consumption
patterns  Two Planets Needed by 2050
Since 1990, our Ecological Footprint exceeds Earth’s bio-capacity;
Bottom line: We are not doing so well, and business as usual
will not work: rising environmental, social and
economic tensions, volatility.
1900 2002 2050 2100
15 15

16. UAE
Qatar
Danemark
Estonia
USA
Kuwait
Mongolia
Nepal
Gambia Ukraine
China
India
DR CongoMozambique

17. Unsustainability as borrowing from the
future
Long-term loans of households as % of GDP
35%
30%
Bulgaria
Czech Republic
25%
Hungary
20% Kazakhstan
Poland
15% Romania
Russia
10%
Slovakia
5% Ukraine
0%
95
00
03
04
05
07
08
94
96
97
98
99
01
02
06
19
19
19
19
20
20
20
20
20
20
19
19
20
20
20
Source: The Economist Intelligence Unit.

18. Aggregate non-financial sector debt of advanced economies and its composition since 1980.
Stephen G Cecchetti, M S Mohanty and Fabrizio Zampolli, The real effects of debt.
September 2011, http://www.bis.org/publ/othp16.pdf

19. Major debtors in Europe (public debt to
GDP ratio, 2011)

21. Debt junkies…
• Nominal GDP of $1,000 billion, 10% per annum growth;
• Aggregate private debt level of $1,250 billion (growing at 20%
p.a.)  private debt increase of $250 billion first year;
• Total spending in that - $1,250 billion (80% from incomes and
20% from debt);
• One year later, the GDP has grown to $1,100 billion;
• If debt stabilizes at $1,500 billion, total spending will be
$1,100 billion ($150 billion less than the previous year);
• Stabilisation of debt levels thus causes a 12% fall in nominal
aggregate demand

22. …producing junk (the instrumental
role of consumer)
• Consumption-production nexus reversed
– The “patriotic duty” to shop – and discard to shop
again – in order to preserve your job
• The skewed definition of “normality” – “static” is “stable
rate of increase”
– everything supposed to “grow”; bigger is better by definition
• Growth (and goods) are means for enhancing people’s
potential to be and do
– “commodity  functionality  capability” chain
we wave
– “natural resource  commodity  garbage” chain

23. Garbage on debt
• Spending money we don’t have to buy things
we don’t need
• Converting the planet’s (our children’s)
resources to produce garbage (and create jobs
in between)
– Makes perfect economic sense but questionable
from sustainable human development perspective
I=P C T x x
=P G T x x