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An ecosystem is biotic assemblage of plants, animals, and microbes, taken together with their physico-chemical environment (e.g. Kormondv, 1969). In an ecosystem the biological cycling of materials is maintained by three groups: producers, consumers, and decomposers (fig. 1a). The producers are plants and some bacteria capable of producing their own food photosynthetically or by chemical synthesis. The consumers are animals that obtain their energy and protein directly by grazing, feeding on other animals, or both. The decomposers are fungi and bacteria that decompose the organic matter of producers and consumers into inorganic substances that can be reused as food by the producers; they are the recyclers of the biosphere. Nature is capable of sustaining the producer-consumer-decomposer cycle indefinitely, with the sun as the energy source. The smallest such entity that is self-sufficient is an ecosystem.
Fig. 1a The movement of chemicals and materials through the natural ecosystem
Fig. 1b The movement of chemicals and materials through a system resulting from human activity (anthroposystem)
Functionally, human activities that perturb the natural environment can also be divided into three similar components (fig. 1b). Producing activities include energy production (fossil fuels), manufacturing (non-fuel minerals), and growing food. The consumers are humans and their domestic animals. Decomposing or recycling activities include treatment of waste water and recycling of metals. However, whereas an ecosystem relies on its decomposers for a complete recycling of its elements, the system created by human activity lacks such efficient decomposers and recyclers. As such, manufactured materials that are no longer needed and the waste by-products of industrial activity are disposed of into the physical environment. The process of adding unwanted material to the environment is called pollution. The waste products are taken up by the atmosphere and the hydrosphere, and delivered to the biological and geochemical receptors. In this sense, the anthroposystem, as defined above, is more of an open system, as discussed by Ayres in chapter 1 of this volume.
The producer-consumer-recycler model provides a convenient framework for comparing ecosystems to anthroposystems. The flow of material in both systems is illustrated qualitatively by the arrows in figures la and lb. In an ecosystem most of the material is transferred from the producers (plants) to the recyclers (bacteria); only a small fraction is passed through the consumers to the recyclers. The decomposes (recyclers) return most of the material to the producers for reuse.
In the anthroposystem the flow from the producers to the recyclers is small (or even non-existent), since it would be pointless to produce (mobilize) material and immediately recycle it without a consumer in the loop. In the anthroposystem much of the mobilized material is transferred to the rest of the external environment by the producer or by the consumer. Hence, it mostly an open system, with recycling accounting for only a small fraction of the mobilized matter.
In an ecosystem, recycling and sustained development (evolution) is facilitated by a close physical proximity and functional matching between the producers and consumers. The physical proximity of producers, consumers, and recyclers in an ecosystem (e.g. plants, animals, and bacteria in a forest) assures that very little energy is required for the physical transport of matter between the plant and its symbiotic bacterial population. Also, the physical proximity allows a reasonably fast mutual adjustment if there is a perturbation in the system.
In the anthroposystem, with consumers playing a more significant role, there is usually a significant physical displacement between the producer and the consumer. The global flow of oil products is the most dramatic example. Accordingly, a significant amount of energy is required to transfer the matter back to the producer or to a recycler. This physical separation of consumers, producers, and recyclers appears to be a major difference between the ecosystem and anthroposystem.
The producer-consumer-receptor-based model is a suitable framework for economic models which study the driving forces of the material flows. It is self-evident that the economics - i.e. the allocation of material resources - will depend on production (availability), consumption (demand), and on the cost at the receptor.
The above ecosystem, i.e. the producer-consumer-receptor-based material flow model, can also be used to formulate physico-chemical models based on mass conservation principles. The next section presents such a formulation.
Ecosystem-based material flow system
The flow of matter from producers to consumers and subsequently to receptors is depicted schematically in figure 2. Most of the production of potential pollutants begins with mining, that is, the removal of a substance from its long-term geochemical reservoir. The amount of pollutant mass, fzMi, mobilized by mining (tons/yr) is the production rate Pi (tons/yr) of the raw material (coal, oil, smelting ore, etc.) multiplied by the concentration c; (gram/ton) of the impurity (sulphur, mercury, lead, etc.): MiciPi.
Fig. 2 Key matrices in the flow of materials from producer to consumer to receptor
Matter is transferred from the producer to the consumer by transportation, including railroads, trucks, and ships. Functionally, transportation redistributes the mobilized substances over a large geographical area and to a multiplicity of consumers. Any producer, i, may deliver its product to any consumer, j. Mathematically, this producer-consumer transfer is characterized by a surface transfer matrix, sij.
The amount of matter, Uij, originating from producer i and used at consumer j is sijMj. The total amount of matter reaching consumer j is the sum of the matter produced by all producers multiplied by their respective surface transfer matrix elements.
The next transfer occurs between the consumer, or emitter, and the environmental receptors. The consumer is located where the combustion or smelting occurs, and the receptor where the pollutant is deposited following its atmospheric or hydrologic transit. Again, consumer j can transfer matter through the atmosphere to any receptor, k, Hence, the matter received at receptor k that originated at consumer (emitter) j, Rjk, is the product of the use rate Uj times the atmospheric or hydrologic transfer matrix, ajk, from emitter j to receptor k. The total amount of matter deposited at receptor k is the sum of the use rates, Uj, at each emitter weighed by its atmospheric/ hydrologic transfer matrix element.
In this chapter, the numeric values of Mi, ci, and sij are discussed in detail, while discussion of the atmospheric transfer matrix, ajk, is beyond the scope of this report.
The release of a trace substance at any given emission site Uj (tons/yr) is calculated as follows: Uj = sijciPi. It has to be noted that in this simplified formulation, the releases are not broken down by media, i.e. air, land, and water. A general approach to include the transfer through all environmental media is presented in the next section, the Environmental Spheres Analogue. An illustration of such a model is given in Husar (1986), as applied to the mobilization and transfer of sulphur in the United States, from its geochemical reservoirs (by mining) to the consumers at the power plants and subsequently to the receptors and receiving geochemical reservoirs.
Shortcomings of the ecosystem analogue
The ecosystem model of nature and of human activities has a major shortcoming in that it pays little heed to the physical transfer of mobilized matter. It does not answer the question of where the redistribution has occurred. Also, in that model, much of the anthroposystem had to be left open since many of the flows were out of the system as waste products. The next section is an attempt to extend the ecosystem analogue by "closing the system." In such a scheme, material is accounted for regardless of where it goes after leaving a given open system.
Chemicals on earth are distributed among four major environmental compartments or conceptual spheres: atmosphere, hydrosphere, lithosphere, and biosphere. While such a compartmentalization of nature is rather arbitrary, it helps in organizing our existing knowledge on the distribution and flow of chemicals. A schematic representation of the four environmental compartments and their interrelationships is shown in figure 3.
The circles represent the spheres and the curved arrows the flow pathways of matter. These are used instead of boxes and straight-line connections to emphasize the close, dynamic, inseparable, organic coupling among the environmental compartments; if one compartment or linkage changes, all other compartments respond.
In this conceptual frame, every sphere has a two-way linkage to every other sphere, including itself. The two-way linkage signifies that matter may flow from one compartment to another in both directions; the two-way transfer within a given compartment indicates movement of the substance from one physical location to another without changing the sphere. Since matter cannot be created or destroyed, the question one seeks to answer is the location and chemical form of the substance at a given time.
The four spheres
The atmosphere is best envisioned as a transport-conveyer compartment that moves substances from the atmospheric sources to the receptors. Its storage capacity for matter is small compared to the other spheres, but it has an immense capability for spatially redistributing matter.
The hydrosphere may be envisioned as two compartments: a conveyor (river system) collects the substances within the watershed and delivers them to the second hydrologic compartment, oceans.
Fig. 3 The four environmental spheres
The lithosphere is the solid shell of inorganic material at the surface of the earth. It is composed of soil particles and of the underlying rocks down to a depth of 50 kilometres. The soil layer is also referred to as the pedosphere, and is a mixture of inorganic and organic solid matter, air, water, and microorganisms. Within the soil, biochemical reactions by microorganisms are responsible for most of the chemical changes of matter. However, soil and rock are mainly storage compartments for deposited matter.
The biosphere is the thin shell of organic matter on the earth's surface. It occupies the least volume of all of the spheres but it is the heart, or the chemical pump, of much of the flow of matter through nature. Weathering through the hydrological cycle, wind, and volcanic releases are the other mobilizing agents. The biosphere is responsible for the grand-scale recycling of energy and matter on Earth. The mobilization of matter by biota is by no means restricted to small geographic regions. The periodic burning of forests and savannas, for example, not only changes the chemical form of matter, but also results in long-range atmospheric transport and deposition. Some of the biologically released chemicals, including carbon, nitrogen, and sulphur, have long atmospheric residence times, resulting in redistribution on a continental and a global scale.
Man and the biosphere
Human activities most closely resemble the function of the biosphere. In more than one way, humans are part of the biosphere. Humans and biota are responsible for grand-scale redistribution of chemicals on earth - once again with major similarities and differences. Fires and other forms of combustion result in an oxidation of both biogenic and anthropogenic elements. In nature, living plants tend to reduce their metabolized chemicals, thus ensuring a cycling of the chemicals that make up living matter.
Once again, the anthroposystem has no built-in mechanisms for reducing oxidized compounds. Man-induced oxidation products have instead to rely on biota for reduction, i.e recycling. Given the limited reduction capacity of the biosphere, many of the combustion products remain in stable oxidized form and are ultimately deposited in another long-term geochemical reservoir.
The atmosphere and the hydrosphere (rivers) are effective conveyors of matter. Consequently, many of the anthropogenic chemicals are transferred to the land oceans where they are subsequently incorporated in these long-term geochemical reservoirs. Much of the environmental damage is done in the atmosphere, hydrosphere, lithosphere, and the biosphere during the transit from one long-term geochemical reservoir to another.
In the "industrial metabolism" metaphor, industrial organizations are likened to biological organisms that consume food and discard waste products. This chapter builds on and extends this metaphor beyond the biological organisms to an entire ecosystem. The human analogue of the ecosystem is the anthroposystem, consisting of producers, consumers, and recyclers.
Using these components, both ecosystem and anthroposystem are described by a conceptual material flow model that is also a suitable framework for an economic model. It is noted that the current anthroposystems differ from ecosystems mainly in that they lack efficient material recyclers that allow sustainable development. In this sense, the anthroposystem is an open system and the analogy with the ecosystem is incomplete.
The environmental spheres analogy extends the ecosystem analogy further by considering the flow of matter in all environmental compartments or conceptual "spheres" - air, land, water, and biota. This extension allows a closing of the system by following the flow and fate of matter regardless of the location and medium of transfer. It is concluded that human activities most closely resemble the role of the biosphere in the mobilization of matter.
The current work could be extended in several ways, in particular by combining the ecosystem and the environmental metaphors into a single "model." In principle, the multimedia "spheres" approach to material flows lends itself to rigorous mathematical formulation using basic conservation laws. In fact, it could incorporate all the features of the ecosystem approach. The resulting model could encompass the complete, end-to-end flow analysis, from the point of "production" i.e. removal of the matter from one geochemical reservoir - to its fate in the receiving reservoir. Such a multimedia physical model would also be a suitable framework for environmental economic analysis.
Clark, W. C., and R. E. Munn, eds. 1986. Sustainable Development of the Biosphere. Cambridge, Mass.: Cambridge University Press.
Husar, R. B. 1986. "Emissions of Sulfur Dioxide and Nitrogen Oxides and Trends for Eastern North America." In: National Research Council, Acid Deposition Longterm Trends. Washington, D.C.: National Academy Press. Husar, R. B., and J. D.
Husar. 1990. "Sulfur." In: B. L. Turner et al., eds. The Earth as Transformed by Human Action. Cambridge, Mass.: Cambridge University Press.
Kormondy, E. J. 1969. Concepts of Ecology. Englewood Cliffs, N.J.: Prentice-Hall, Inc.
Udo E. Simonis
Until recently, the role of economic or industrial change as a driving force for environmental change has not been widely explored.) This may be due in part to the difficulty of collecting suitable data and indicators with which to describe the impacts of an economic structure on the environment. In part it may be due to the fact that the level of economic development or the growth rate of the economy was thought to be more important for explaining the changes occurring in the natural environmental.
The present chapter approaches the links between the various sectors (or industries) of the economy and the overall economic performance and addresses the possible delinking of polluting sectors (or industries) from the gross domestic product (GDP); it thus views restructuring as one way towards a more efficient industrial metabolism.
Such an examination could take place on the level of the individual sector (or industry) or the aggregate level of all sectors (or industries), but also at the regional level. It should at least be undertaken for those sectors (or industries) whose environmental effects are rather certain (structural environmental impacts). This would imply a mesoeconomic, not a micro-economic, approach to understanding environmental change. Such an examination may make it possible to assess current structural changes in economies and, on the basis of their environmental implications, may suggest future directions for environmentally benign structural policies.
The expression "structural change" or "restructuring" is generally used to characterize the decline or increase over time in certain sectors, groups of industries, or regions (and, sometimes, technologies) as regards gross national/domestic product.³ One may also think of structural change in terms of a transformation in the mix of goods and services produced; or one may refer to a broader set of changes in the economy, not only in its products and employment, but also in the social relations of production (e.g. unionization, part-time v. full-time jobs), the means of production (handicrafts, robotics), and the forces of production (market demand, profits).
Clearly, not all possible classifications and groupings are helpful or of interest for purposes of structural research. One either has to make an explicit choice, or one has implicitly made one in using or referring to a well-known, long-established concept of structural change. In this chapter, we will use one of several concepts of structure in economics, namely the sectoral production structure - i.e. the share of sectors in the economy and their relation to gross domestic/net material product.
Economic restructuring thus subsumes industrial restructuring, though the terms are often used interchangeably. Any restructuring of the sectors (or industries) in an economy is, of course, linked to more profound changes in other realms. For our purposes, and within this concept, we will deliberately select sectors whose environmentally destructive potential is beyond question. Thus we will not consider the regional structure, the employment structure, and the investment structure, even though all of these might be quite relevant in explaining the given environmental situation of a country, or its change over time.
Regarding the temporal dimension of structural change, there is, as we will see, a differentiation to be made between discontinuity and gradualism. There is economic restructuring as a discontinuity, or a break in development, and there is gradualism as an evolutionary or slow transition. Discontinuity may be the outcome of subterranean historical processes, but gradualism is the everyday reality of change. Clearly, the two are not mutually exclusive, but rather two sides of the same coin.
As regards impacts, we use the term "structural environmental impact," which means the environmental stress (or burden) that results from a given sectoral production structure, irrespective of pollution-control measures in the form of end-of-pipe treatment.
It is not so long ago that sheer quantity of output was considered to be an indicator of a nation's economic success; in some circles this still seems to be the case. In Eastern Europe the importance attached to this criterion led to "tonnage ideology." In Western societies steel production and railways tonnage were once considered to be central indicators of economic success; currently housing starts, energy consumption, and the number of cars produced play this role. This accounts for the importance of the motor industry in the political arena. For a number of reasons, however, indicators of energy and materials consumption must be understood as indicators of economic failure.
Particularly in times of high or increasing costs for energy and materials, a high consumption of such inputs may turn out to be uneconomic. And countries that have drastically reduced their specific energy and materials use are today at the top of the international list of economic performance; resource use efficiency (or "materials productivity") has a major contribution to make in evolving new strategies towards sustainable development.
No wonder, then, that economists, planners, and engineers are seeking solutions to the problem of how to modify or restructure the existing patterns of energy and materials use, to switch from "high-volume production" to "highvalue production."5 At the same time, this reorientation reflects new and potentially strong environmental priorities. The hope of a "reconciliation between economy and ecology" and the envisaged "industrial metabolism" relies on the premise that a reduction in the energy and material input of production will lead to a reduction in the amount of emissions and waste, and will help to facilitate the potential for recycling and promote the option of intentionally closing cycles in industrial society.
The industrial system as it exists today is ipso facto unsustainable (R.U. Ayres). While the natural cycles (of water, carbon, nitrogen, etc.) are closed, the industrial cycles (of energy, steel, chemicals, etc. ) are basically still open. In particular, the industrial system starts with high-quality materials (like fossil fuels and metal ores) and returns them to nature in a degraded form.
On the basis of materials cycle analysis, it would appear that industrial society has drastically disturbed, and still is disturbing, the natural system. Ayres proposes two main criteria or measures of an approach towards (or further away from) sustainability, the recycling ratio and materials productivity. In the form of policy suggestions, this means (1) reducing the dissipative losses by near-total recycling of intrinsically toxic or hazardous materials, and/or (2) increasing economic output per unit of material input.
In this chapter, we will use a somewhat different, but comparable, approach in focusing on structural change in the economy and its environmental impact. To assess the empirical dimensions of the harmful or potentially benign environmental effects of structural change, we need suitable information concerning the material side of production. This by itself is not an easy task, especially if we look for cross-national comparisons. Resource conservation, materials productivity, and environmentally significant structural change are not appropriately described by the monetary values used in national accounts, although national accounts and, particularly, input-output tables offer some information. An alternative is to select indicators that act as synonyms for certain characteristics of the production process.
Certain indicators have been in the forefront of the environmental debate since it began, and the availability of data on the emission of various (representative) pollutants has grown considerably.10 Our present interest, however, is on environmentally relevant input factors.
Given the state of research and data availability, only a few such indicators can be tested in a cross-national comparison of Eastern and Western economies. The results of this test thus cannot give a precise picture of the real world, but can at least offer some patterns of environmentally relevant structural change from which hypotheses could be derived for further research. We use four such factors whose direct and indirect environmental relevance is indisputable: energy, steel, cement, and the weight of freight transport.
Energy consumption in general is accompanied by more or less serious environmental effects, and energy-intensive industries in particular pose environmental threats. Energy consumption thus is probably the central ecological dimension of the production pattern of a country. For similar reasons steel consumption is also a general indicator of structural environmental stress, in that it reflects an important part of the material side of industrial society. Cement consumption is in itself a highly polluting process, and cement represents to some extent the physical reality of the construction industry. (For reasons of data availability, in the following we use the production statistics of cement only.) The weight of freight transport can be understood as a general indicator of the volume aspect of production, as nearly all kinds of transport are accompanied not only by high materials input but also by a high volume of hazardous emissions. (In the following, we use data for road and rail transport only.)
The empirical investigation covers the period from 1970 to 1987 and includes 32 countries from the East and West, i.e., nearly the whole industrialized world. As is well known, certain methodological problems arise when comparing data on the national (domestic) product of Eastern and Western economies. For the purposes of this study, we relied on the data given in the National Accounts of OECD Countries, on data from the Statistical Office of the United Nations, and on other well-established data series, as specified in table 1.
Table 1 Data sources
Energy Agency (IEA), Energy Balances of
OECD Countries 1970-1985 and Main Series from 1960;
Department of International Economic and Social Affairs
of the United Nations, Energy Statistics Yearbook, Year
book of World Energy Statistics, and World Energy Sup
Office of the United Nations, Statistical
Statistical Bureau of the United States, Statistical
Abstracts of the United States
Office of the United Nations, Statistical Yearbook
and Monthly Bulletion of Statistics
Commission for Europe of the United Nations,
Annual Bulletin of Transport Statistics for Europe; Inter
national Road Federation (IRF), World Road Statistics;
International Railway Federation (UIC), International
for Economic Cooperation and Development
(OECD), Labour Force Statistics 1965-1985; Statistical
Office of the United Nations, Demographic Yearbook
States Statistical Yearbook, Comparative Internation
al Statistics; Statistical Bureau of the United States, Statis
tical Abstracts of the United States; Organisation for Eco
nomic Cooperation and Development (OECD), Main
Economic Indicators and National Accounts of OECD
The harmful as well as the benign environmental effects of structural (or industrial) change and the significance of a structurally oriented environmental policy have been cited in recent literature. According to this insight, environmentally benign effects of structural change are to be expected by actively delinking economic growth from the consumption of ecologically significant resources, like energy and materials. Such delinking, achievable in particular by decreasing the input coefficients of these resources (dematerialization, re-use, recycling) or by increasing their effectiveness (energy and materials productivity) through better use,
- would result in a decrease in resource consumption and probably also in production costs, at least in the long term;
- would mean ex ante environmental protection, which is cheaper and more efficient than ex post installation of pollution-abatement equipment (end-of-pipe technology);
- would be environmentally more effective, since end-of-pipe technologies normally treat only single, "outstanding" pollutants, whereas integrated technologies touch upon several environmental effects simultaneously; and
- would open up a broad range of options for technological innovation or would itself be the result of such innovation.
For certain types of pollution, the effectiveness of structural change has been verified empirically. For example, structural change with respect to energy consumption had more benign environmental effects than endof-pipe protection measures, especially as regards such emissions as SO2 and Nox. Several OECD reports on the state of the environment reflect this fact for a number of countries. Changes in the energy structure, for instance, led to greater environmental protection effects than the installation of desulphurization plants. In Japan, energy conservation (and also water conservation) has been particularly successful; conventional environmental protection has been superseded by technological and structural change.
Examples like these may support the rapid introduction of market instruments, like resource taxes and effluent charges - a policy that would accelerate structural change and lead to economic advantages as well as to environmental relief.
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