Key Message
Governments can alter the economy with a broad range of tools and instruments. How does this behaviour affect the pursuit of sustainable development?
Policy Instruments
Designing pro-SD public policies
What's New in Economics and SD?
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Markets for Ecosystem Services: A Potential Tool for Multilateral Environmental Agreements (PDF - 327 kb)
Markets for ecosystem services and market-based instruments, though mainly intended to protect the environment, can also help alleviate poverty rather than exacerbate it when designed to be pro-poor. Links between the objectives of various multilateral environmental agreements (MEAs) and the Millennium Development Goals, for example, indicate considerable scope for the development of pro-poor markets for ecosystem services by MEA regimes. This paper lays out the argument for using MEAs to develop pro-poor markets for ecosystem services and shows how participation by the public sector is critical for their success. Together, MEAs and governments can provide the institutional structure for these markets to work efficiently and equitably.
Governments have a range of instruments available at their disposal. Many of these aim to influence our economic behaviour, but have broad impacts in terms of sustainable development. These include: carrots (subsidies); sticks (emission regulations); sermons (education and voluntary instruments); and direct intervention (direct purchases, investments and the creation of markets). What have been the experiences with these various instruments from the perspective of sustainable development? IISD has undertaken work on several aspects of this topic as described below.
Contents
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Markets for Ecosystem Services
Markets for ecosystem services (MES) are increasingly recognized as having an important role to play in the sustainable use of ecosystem services and, more recently, in reducing poverty. IISD has been researching the potential for using MES to enhance the implementation of multilateral environmental agreements. -
Regulations
Comparisons of anticipated (before-the-fact) costs and benefits of environmental regulation with actual results achieved (ex-post) provide valuable insight to environmental regulators, policy-setters, industry and those charged with parliamentary oversight. IISD has undertaken a multi-year project to develop an ex-post guidance document that will be tested against “real world” experience. -
Standards
Industry is being called upon to improve social and environmental performance through voluntary initiatives, including: environmental management systems; codes of conduct; certification; and public reporting on environmental and social issues. All of these rely, in varying degrees, on the existence of suitable standards and, in some cases, credible verification systems. Standards have always been important to trade and market access. IISD's research identifies how countries can reduce the negative impact of sustainable development standards on market access and increase the positive impact of these standards on corporate behaviour. -
Global Subsidies Initiative (GSI)
IISD seeks to lay bare just what good or harm public subsidies are doing; to encourage public debate and awareness of the options that are available; and to help provide policy-makers with the tools they need to secure sustainable outcomes for our societies and our planet.
Key Publication
Exploring the Links: Human Well-being, Poverty and Ecosystem Services
» Anantha K. Duraiappah, IISD, 2004.Exploring the Links sets out to demonstrate how human well-being is dependent upon ecosystems and ecosystem services; to identify barriers and drivers that prevent the poor from using these ecosystem services to improve their well-being, in essence perpetuating poverty; and to identify policy response options to remove the barriers, re-design or even introduce new intervention strategies to allow the poor to improve their well-being through an ecosystem approach.
Our Knowledge
» Themes
- Climate Change and Energy
- Economics and SD
- Foreign Investment for SD
- Governance for Sustainable Development
- Information Society
- International Trade
- Measurement and Assessment
- Natural Resources
- Networks & Partnerships
- Security
- Sustainable Markets
- Tomorrow's SD Leaders
» Initiatives
