Page 174 - Supplemento 2-2016 (ENG)

Francesco la camera

systems provide the economic system with resources that may be renewable or
not renewable. On the other side, with scant consideration, the economic
system gives back the waste products of consumption and production. The
environmental issue arises when this relationship compromises both the ecosy-
stem’s capacity to provide natural resources and, from a public perspective, pol-
luting activities end up diminishing our own capacity to enjoy the environment,

How does traditional economy confront the relationship between these
two fluxes that very often don’t have a market price? It confronts it by it stating
that the market, in a situation of free competition, will inevitably lead the eco-
nomic system to the greatest prosperity, considering that prosperity is basically
a function of the quantity of goods and services consumed. So greater econo-
mic growth equals greater prosperity. Naturally, fluxes that do not influence the
market, although they have no price, have an impact on our wellbeing.
Traditional economy resolves this problem through an estimate and the attri-
bution of a monetary value to the environmental dimension: this is technically
called the internalization of environmental impacts. All of this is driven by the
belief that bringing the environmental dimension inside the market, its natural
function, at the right price, would inevitably lead to greater economic growth
and, consequently, to greater prosperity.

Thus, in the perspective of traditional economy, economic growth has no
limits: it depends on the availability of inputs, but these are regarded as basically
interchangeable thanks to technological capability. The market, through the
price system, guaranties a correct use of resources and the technological capa-
bility of the system allows for such a mixture of inputs as to guarantee conti-
nuous economic growth and consequently the growth of prosperity. With
regards to aspects of justice and the reduction of inequality in the international
dimension, the policies to aid development have discounted this approach.

Economic growth in developed countries should also have involved poo-
rer countries. This is the vision that has guided the activities to support deve-
loping countries from the 50s to today.

If we want to use a diagram to summarise this economic vision, which
immediately has an ethical impact, economic growth is presented as the ultima-
te goal of the socio-economic system.

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