- There are two main schools of thought of development: the first one understands development mainly as economic growth, and the second one considers development as a dynamic multidimensional process toward expected views and goals of societies.
- Development as economic growth has its roots in the neoclassical school , iniciated formally in 1947 after President Truman speech on the need for investment in industry, infrastructure, education and science for producing progress, that had been a success in USA and invited the rest of the world to follow and imitate it. The “vicious circle” of poverty, in which scarce demand does not allow for industry and production expansion and thus employment and income don’t grow either, has to be broken by a “virtuos cycle” of economic investment and demand , in which state plays a support role but markets and private sectors are the main actor; this approach has been promoted by Reagan, Tatcher, Bush and by many latinamerican governments under the exigence of IMF , WB and other monetary sources. Its main indicator is GDP/person under the assumption that increasing income will provide the means for acquiring all the needs and expectations of people.
- However, the theoretical basis of neoclassical school, which are free competition and enterprise, full information, rational consumers, marginal decreasing profits, that conduce to a general equilibrium between demand and supply, expressed in prices and toward economic convergence of countries, have been increasingly challenged in the past 30 years by its own scholars , which have found that real world is under very imperfect competition, high asymmetry of information, irrational behavior of consumers, increasing returns , that lead toward unstability and divergence between social groups.
- Social Inequality and environmental damage, as prices do not reflect correctly the real economic value to society of high consumption, waste and ecosystms damage, are additional consequences of such a model. The current economic state of the world is quite well reflected in the “elephant curve” by Milanovic and Lanker in which they show how production, trade and commerce mundialization has resulted in the last 35 years in countries economic convergence, as well as social classes divergence, at least in most economically advanced countries. The global warming fact is a reality that is increasingly affecting bigger amount of people and regions.
- Development as multidimensional process is a response, a reaction to the narrow perspective of the above first version of development and has been leaded by several actors, such as United Nations. Since the 1987 Brundlant Commission definition of sustainable development as “the development that satisfies the needs of current generation without compromising the capacity of future generations for satisfying theirs”, “, there have been advances such as the IHD, Index of Human Development that reflects health, education and PPP, purchasing power parity. Another intent to visualize true development in a more broader approach is the set of 17 SDO, Sustainable Development Objectives , approved by the UN general assembly in 2015, which comprises very broadly the main issues of conflict between current economic trend and social and environmental well being. Other main contributions are “development as Freedom” by Amartya Sen, and the more recent approach of development as dignity by Castells and Keppa, which created the Index of National Dignity and tested it in a sample of few countries . all of these indexes are of extreme value, although have some limitations or constrains; one of them is that do not take sufficient account of the surroundings , both social and natural, that support individual happiness and success. Social and economic relations ; institutional framework and public and civic conditions and virtues are important factors of true development and individual and social welfare and wellbeing. Numerous current authors, especially from latinamerica, claim that progress is not just money but “Buen vivir”.
- The ecological economist Robert Costanza and his team have estimated the economic contribution of nature´s 19 main ecosystems finding a tentative value of 125 to 135 trillion dollars in 2007, while the total worlds human produced GDP was 75 trillion, meaning that nature is fundamental for economic and social well being of humanity; other intents corroborate it, such as the “genuine progress index” of United States that calculated that normally measured US GDP in 2004 was near 11 trillions, while if calculated taking into account factors such as domestic, voluntary work and air, water , soil deterioration, non renewable resources depletion and others, the real GDP would be only about 4.5 trillions. True accountability of social production, both in or out the markets; of natures contribution and environmental deterioration are fundamental for society decisions in the future.
- Fonseca, a Colombian social and environmental researcher offers the “ Index of Sustainable Territorial Development ”, in which tries to puttogether the different contributions about what is development in a broad multidimensional perspective. In doing so, he built a model of five Territorial Richnesses that must evolve in a balanced manner if sustainability is the goal in a territory: Human Richness ( health, education, poverty factors, forced displacement; municipal opportunities attraction , gender equality and nutrition) that reveal how receptive and challenging is a municipality for people; Intelectual Richness (3 modes of knowledge building capacities: Academic, Entrepreneurial and Open/traditional knowledge), that reveal the capability of understanding and managing well the resources and the territory and the capacity to offer to the world new and valuable knowledge. Private Richness which comprises both the production and export capacities, as well as diversity and complexity of production; Public Richness, that reveals both tangible and intangible factors of institutional and civic values, assets and abilities; finally, Natural/Environmental Richness with two elements: Risk Factors (Seismic, Flooding, land sliding, mining pressure, and economic intensity); and Natural Endowments (Forest cover, soil and land use vocation; forest cover evolution). The five richnesses must evolve in a balanced manner in order to maintain sustainability and resilience.
- Fonseca conducted a very detailed exercise of application of the Index of territorial its application in Colombia at municipal level, obtaining three very interesting results:
- 1) Colombia is growing at the expense of its natural and environmental richness; nature is being destroyed and population and activities are being placed and conducted in more risky areas.
- 2) Current relative dimensions of the five richness are too different; specially Institutional and Public Richness is two low .
- 3) As municipalities turn bigger , the five richness don’t convey in their dimensions, but rise more apart, toward different directions resulting in a more unsustainable pattern. So, it is imperative to protect and restore ecosystems, to urgently increase public and institutional richness, specially taking into account its critical importance in the process of peace implementation going on, and to achieve a more balanced evolution of the five richness, in such a way that convey between them.
