Environment and Development Report: Economic Concepts and Mechanisms

This report examines the intersection of environment and development through an economic lens, focusing on the relevance of the Triple Bottom Line (TBL) framework and the ecosystem services approach. It critiques the TBL's applicability, particularly in addressing extreme poverty, and explores its economic, social, and environmental values. The report highlights the importance of sustainable practices, balancing profit incentives with environmental and social considerations. Furthermore, it addresses economic mechanisms for regulating environmental quality, including carbon markets and the Clean Development Mechanism, while also considering the economic impacts of climate change as outlined in the Stern Review. The report provides an overview of economic concepts related to environmental goods, services, and resources, and the challenges confronting international agreements on greenhouse gas reductions. The analysis extends to the concept of 'pro-poor' development and links it to carbon markets.

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The ecosystem services approach and the total economic value (TEV) framework add little to
the relevance of the ‘economics’ component in a triple bottom line [economic – social –
environmental] assessment of growth and development, particularly from the perspective of
the extreme poverty.
The concept of Triple Bottom Line has been viewed as essential attempts of introducing
paradigm to the domain of social-economic and environmental setup. Although the original
introduction of the concept was treated as a tool of business, no one had the idea of its universal
application that is evident today (Milne & Gray 2013). One of the key elements of the concept of
the Triple Bottom Line is its ecological values. In this context, the reference is made to those
environmental practices which are considered sustainable. The company that applies the concept
of TBL does not engage in the production of destructive or harmful products like batteries with
heavy metals and other weapons.
As of the economic values of TBL, all the practices that result into the creation of environmental
challenges but ends up with money loss are never sustainable considering that the business might
lack funding’s of its operations later in the date. TBL concept should not be viewed as having the
intention to exclude profit incentives from the businesses. The existence of TBL is therefore to
balance incentives of profit with the decisions of the production cost that are normally
externalized (Gold, Hahn & Seuring 2013).
The other key aspect of TBL is its social value that addresses the beneficial and fair business
operations towards the community, labor and the region under which the activities of the firm are
carried out. A TBL firm will, therefore, aim at benefiting many constituencies by ensuring that

no group is endangered or destroyed. Such firms never embrace activities like child labor and the
exploitation of the poor.
References
Gold, S., Hahn, R., & Seuring, S. (2013). Sustainable supply chain management in “Base of the
Pyramid” food projects—A path to triple bottom line approaches for
multinationals?. International Business Review, 22(5), 784-799.
Milne, M. J., & Gray, R. (2013). W (h) either ecology? The triple bottom line, the global
reporting initiative, and corporate sustainability reporting. Journal of business
ethics, 118(1), 13-29.