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Overcoming Environmental Degradation and Wealth Inequality in the Asia-Pacific Region

Published online by Cambridge University Press:  14 March 2025

Edward B. Barbier
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Drawing on historical and contemporary evidence, I argue that these two threats are symptomatic of a growing structural imbalance in all economies, which is how nature is exploited to create wealth and how it is shared among the population. The root of this imbalance is that natural capital is underpriced, and hence overly exploited, whereas human capital is insufficient to meet demand, thus encouraging relatively higher wages for skilled labor and resulting wealth inequality.

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Research Article
Information
Asia-Pacific Journal , Volume 13 , Issue 46 , November 2015 , e1
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Creative Common License - CCCreative Common License - BYCreative Common License - NCCreative Common License - ND
This is an Open Access article, distributed under the terms of the Creative Commons Attribution-NonCommercial-No Derivatives licence (http://creativecommons.org/licenses/by-nc-nd/4.0/), which permits non-commercial re-use, distribution, and reproduction in any medium, provided the original work is unaltered and is properly cited. The written permission of Cambridge University Press must be obtained for commercial re-use or in order to create a derivative work.
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References

Notes

1 There is now considerable evidence of this process, as documented in E.B. Barbier, 2015. Nature and Wealth: Overcoming Environmental Scarcities and Inequality. Palgrave MacMillan, London. Although the strongest evidence of the growing income and wealth gap in recent decades between relatively high compared to low-skilled workers in the economy is for the United States, it appears that other economies have been experiencing similar trends. For example, the Organization for Economic Cooperation and Development (OECD). 2011. An Overview of Growing Income Inequalities in OECD Countries: Main Findings. Divided We Stand: Why Inequality Keeps Rising. OECD, Paris, p. 31 found that “the evolution of earnings inequality across OECD countries over the past few decades could be viewed mainly as the difference between the demand for and supply of skills… the outcome of a ‘race between education and technology’.” Similarly, as developing economies increasingly adopt the skill-biased technologies of advance economies and the demand for skilled labor rises globally, there is also increasing pressure of the relative wages of skilled workers and inequality worldwide. See, for example, E. Berman and S. Machin. 2000. “Skill-biased technology transfer around the world.” Oxford Review of Economic Policy 16(3):12-22; Florence Jaumotte, Subrir Lall and Chris Papageorgiou. 2013 “Rising Income Inequality: Technology, or Trade and Financial Globalization?” IMF Economic Review 61(2):271-309; E. Lee and M. Vivarelli, eds. 2006. Globalization, Employment, and Income Distribution in Developing Countries. Palgrave Macmillan, London; E. Meschi and M. Vivarelli. 2009. “Trade and Income Inequality in Developing Countries.” World Development 37:287-302. Thus, the rising demand for skilled labor, and the subsequent inequality in income earnings and wealth, appears to be a global phenomenon.

2 The members of the G20 include 19 countries (Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the UK and the US), plus the European Union.

3 See, for example, Intergovernmental Panel on Climate Change (IPCC) Working Group II (http://www.ipcc.ch/report/ar5/wg2/). 2014. Climate Change 2014: Impacts, Adaptation, and Vulnerability. Saunders, Philadelphia.

4 Marshall Burke, Solomon Hsiang and Edward Miguel. 2015. “Global non-linear effect of temperature on economic production.” (http://www.nature.com/doifinder/10.1038/natu re15725) Nature.

5 G. McGranahan, D. Balk, D. and B. Anderson. 2007. “The rising tide: assessing the risks of climate change and human settlements in low elevation coastal zones.” Environment and Urbanization 19(1): 17-37.

6 R.J. Nicholls, Hanson, S., Herweijer, C., Patmore, N., Hallegatte, S. Corfee-Morlot, J., Chateua, J. and Muir-Wood, R. 2007. Ranking of the World's Cities Most Exposed to Coastal Flooding Today and in the Future: Executive Summary. OECD Environment Working Paper No. 1. OECD, Paris. See also Organization for Economic Cooperation and Development (OECD). 2008. Costs of Inaction on Key Environmental Challenges. OECD, Paris and United Nations Development Programme(UNDP). 2008. Human Development Report 2007/2008. Fighting Climate Change: Human Solidarity in a Divided World. UNDP, New York.

7 H. Brecht, Dasgupta, S., Laplante, B., Murray, S. and Wheeler, D. 2012. “Sea-Level Rise and Storm Surges: High Stakes for a Small Number of Developing Countries.” The Journal of Environment and Development 21:120-138.

8 Edward B. Barbier. 2015. “Hurricane Katrina's lessons for the world.” Nature 524:285-287 and Edward B. Barbier. 2015. “Climate change impacts on rural poverty in low-elevation coastal zones.” Estuarine, Coastal and Shelf Science, published online doi:10.1016/j.ecss.2015.05.035 (http://dx.doi.org/10.1016/j.ecss.2015.05.035)

9 Edward B. Barbier and Anil Markandya. 2012. The New Blueprint for a Green Economy. Routledge/Taylor & Francis, London, p. 19.

10 See, for example, Facundo Alvaredo, Anthony B. Atkinson, Thomas Piketty, and Emmanuel Saez. 2013. “The Top 1 Percent in International and Historical Perspective.” Journal of Economic Perspectives 27:3-20, and Markus Stierli, Anthony Shorrocks, Jim Davies, Rodrigo Lluberas and Antonios Koutsoukis. 2014. Global Wealth Report 2014. Credit Suisse Research Institute, Zurich. The ten countries with longterm wealth inequality data that are the focus of the latter report are Australia, Denmark, Finland, France, the Netherlands, Norway, Sweden, Switzerland, the United Kingdom and the United States. Alvaredo et al. (2013) also analyze long-term trends for Canada and Japan, but not Denmark, Finland, the Netherlands, Norway and Switzerland.

11 Stierli et al. (2014), op. cit., p. 13.

12 Stierli et al. (2014), op. cit., Figure 1, p. 24, Figure 4, p. 26, and pp. 24-26.

13 “Beijing Population 2014” (http://worldpopulationreview.com/world-cities/ beijing-population/), World Population Review, October 19, 2014.

14 Based on air quality monitoring data released by the U.S. Embassy Beijing, as reported in Lily Kuo. “Six years of Beijing air pollution summed up in one scary chart.” (http://qz.com/197786/six-years-of-bejing-air-po llution-summed-up-in-one-scary-chart/) Quartz April 10, 2014.

15 Avraham Ebenstein, Maoyong Fan, Michael Greenstone, Guojun He, Peng Yin and Maigeng Shou. 2015. “Growth, Pollution, and Life Expectancy: China from 1991-2012.” HKUST IEMS Working Paper No. 2015-10, February 2015.

16 As reported by Jonathan Kaiman. “Beijing smog makes city unliveable, says mayor.” (http://www.theguardian.com/world/2015/jan/2 8/beijing-smog-unliveable-mayor-wang-anshun-china) The Guardian 28 January 2015.

17 Chunbo Ma. 2010. ‘Who bears the environmental burden in China — An analysis of the distribution of industrial pollution sources?” Ecological Economics 69:1859-1875; Ethan D. Schoolman and Chunbo Ma. 2012. “Migration, class and environmental inequality: Exposure to pollution in China's Jiangsu Province.” Ecological Economics 75:140-151; Siqi Zheng and Matthew E. Kahn. 2013. “Understanding China's Urban Pollution Dynamics.” Journal of Economic Literature 51(3):731-772.

18 Zheng and Kahn (2013), op. cit., pp. 746-747. Ironically, when air pollution regulations are enforced, it is also the less-skilled workers in urban and surrounding areas whose incomes are most affected by the reduction in industrial and mining jobs; see “The cost of clean air.” (http://www.economist.com/news/china/216422 14-measures-combat-air-pollution-are-biting-hard-industrial-areas-already-hit-economic) The Economist February 7th 2015.

19 Zheng and Kahn (2013), op. cit.

20 Oliver Wainwright. “Inside Beijing's airpocalypse - a city made ‘almost uninhabitable’ by pollution.” (http://www.theguardian.com/cities/2014/dec/1 6/beijing-airpocalypse-city-almost- uninhabitable-pollution-china) The Guardian 16 December 2014.

21 Edward B. Barbier. 2015. “Policies to Promote Green Economy Innovation in East Asia and North America.” STI Policy Review 6(1):54-69.