Economic sustainability in de¨elopment theory
‘Economic sustainability’ implies a system of production
that satisfies present consumption levels
without compromising future needs. The ‘sustainability’
that ‘economic sustainability’ seeks is
the ‘sustainability’ of the economic system itself.
The notion of ‘economic sustainability’ was originated
by Hicks. In his classic work Value and
Capital Ž . 1939; second edition 1946 , Hicks defined
‘income’ as ‘the amount one can consume during
a period and still be as well off at the end of the
period’.
Traditionally, economists, assuming that the
supply of natural resources was unlimited, placed
undue emphasis on the capacity of the market to
allocate resources efficiently. They also believed
that economic growth would bring the technological
capacity to replenish natural resources destroyed
in the production process. Today, however,
a realization has emerged that natural
resources are not infinite. The growing scale of
the economic system has strained the natural
resource base.
This has caused many commentators, such as
Goodland, to question the feasibility of uncontrolled
growth and exponential consumption.
Goodland 1995 writes that to speak accurately Ž .
in terms of ‘economic sustainability’, it is necessary
to ‘extrapolate the definition of Hicksian
income from its sole focus on human-made cap- Ž .
ital and its surrogate money Ž .. . . to embrace the
other three forms of capital natural, social and Ž
human ’.