An Integral Approach to Sustainable Development

Article excerpt

International economists are well aware that good policies alone do not ensure economic development. Also needed are effective civil and social institutions, which provide the most fertile ground for sustainable development. Sustainable development is the outcome of more than economic processes. It is the result of economic, social, and political processes that interact and reinforce one another in a positive sense. It sustainable development is to be achieved, opportunities must be generated, good initiatives facilitated at all levels, and stability ensured. This requires a better understanding of the socioeconomic dynamics behind economic development as well as actions at local, national, and international levels.


How can priorities for economic development be determined in practice? What framework is needed to ensure sustainable economic growth and an effective distribution of wealth that affords individuals and societies equal opportunity? The traditional means of studying and implementing economic development have not been sufficient to achieve sustainable economic development. An integral approach to economic development is also needed--an approach that seeks to strengthen the civil and social institutions such development requires.


An Agenda for an Integral Approach to Development

Development economics is concerned with the causes and effects of poverty and low income in countries around the world. Based on its findings, it seeks to improve direct interventions on the ground as well as policy design, to enable individuals, regions, and countries to achieve greater economic prosperity. Functioning social institutions such as the family, the local community, the rule of law, the domestic security infrastructure, and public institutions are absolutely essential if development programs and policies are to achieve their objectives. In practice, however, these institutions are often inadequate to meet development demands. Many development problems result from obstacles to the introduction of new technology, the violation of property rights, and price distortions due to protectionist policies. These disruptive policies often stem not from ignorance on the part of policymakers but from widespread corruption. Successful economic development initiatives must therefore identify institutions that are relevant to the development effort, determine the improvements they require, and then strengthen them to enable them to perform the tasks necessary for development.

Institutions are run by persons. Good policies and functional institutions are not enough. Corruption, for example is clearly not good for the economic process as it diminishes moral and human capital and creates inefficiencies in the market by increasing transaction costs. Similarly violence and the violation of property rights are conducive to the same type of inefficiency.

International organizations and nongovernmental organizations (NGOs) now realize the importance of implementing systems that not only ensure more effective management of development funds but also measure the impact of their efforts in the broader macroeconomic context as well as on the immediate recipients. Concerns have been raised about traditional means of gauging effectiveness. One of the reasons for such concerns has been the metrics typically used to measure and analyze progress in advancing the sustainable development agenda. For example, an organization that implements a job-training program will typically measure the participants' improvement in specific skills or in income. An integral approach to development would require an organization to measure the resulting impact of its development efforts on the participants' families, communities, and cultures, as well as on a broader definition of quality of life. Furthermore, in measuring the impact of development efforts, what matters in terms of fundamental human development is not only actual income but also how that income is used. …


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