The 4 Capital Approach: A Framework for Thinking about Sustainable Community Development

Announcements Name tags and photos Books at 20% discount in my office Be on time to guest lectures! Reflections are to handed in via Web-CT Course related s to me must begin with CDAE 102 in the subject line, or they will be ignored First 2 assignments due Meeting rooms for discussion groups will be assigned according to project groups, and posted on Web CT. If more than 9 people have signed up for a project on a discussion board, then you should also sign up for your 2 nd choice.

What’s required to build a sustainable community? A physical setting with clean air, clean water, stable climate, raw materials, etc. Basic physical infrastructure An economy– a way to produce what we need to survive Social relations, trust, norms of behavior, etc. –Equity An educated population capable of running the economy, maintaining the infrastructure, etc. Technology Good government

The 4 legged table Economy Environment Equity Education

The 4 Capitals Natural capital= environment Built capital= economy Human capital= education Social capital= equity What about good government? Healthy communities require all of these

What is capital? Piles of money? Produced means of production? Stock or fund that yields a flow of goods and services into the future.

What is the relationship between capital and sustainability? What is a sustainable use of financial capital, e.g. a trust fund? What is sustainable use of built capital? Of natural capital? Sustainability means living off the interest

How do we develop sustainable communities? How do you develop a business? We need to invest in the different capitals Each of the capitals is fundamentally different

Built capital Physical Infrastructure Business, industry, etc. Traditional subject matter of economics

Built capital What happens when we use built capital? –It wears out, but is not used up –It does not become part of what is produced Who owns it? –Sweat equity Where does built capital come from? What is sustainable use? –Depreciation = investment

Natural Capital The types of natural capital –Land, water, atmosphere –Raw materials, ecosystem structure –Ecosystem services, or ecosystem function –Waste absorption capacity Who owns it? Who should own it?

Natural Capital What happens when we use these? –Land: not used up, but can be degraded –Raw materials: used up, transformed into something else –Ecosystem services: not used up or worn out, still there for others –Waste absorption capacity: worn out What is sustainable use? –Ecological carrying capacity How do we invest?

The special relationship between built and natural capitals The laws of thermodynamics –All built capital depends on raw materials provided by nature –All built capital generates waste Investment in built capital generally requires disinvestment in natural capital –Depletion of raw materials –Resource depletion and loss of ecosystem services –Waste emissions and loss of ecosystem services

Human capital Human knowledge Technology Labor

Human capital What happens when we use it? Who owns it? Who should own it? What is sustainable use? –Knowledge and technology vs. labor –Never more than one generation away from ignorance How do we invest in it?

Social capital Humans are social animals Trust between people Norms that guide our behavior Networks of communication Organizations, structures and social relations that increase abilities to satisfy our needs Do we include government here?

Social capital Who owns it? What’s its relationship with equity? What happens when we use it? What happens when we don’t use it? How do we invest in it? What is sustainable use? –Social caring capacity

How do we decide which capital to invest in? What are the desired ends? The law of diminishing marginal returns What are the opportunity costs? Equimarginal principle of optimization Which capital offers the highest returns at the margin?

Other themes in the course

Systems thinking 4 capitals/ 4 Es Inherent complexity –How do the pieces interact? Study of a rapidly evolving system –What are the forces (feedback loops) driving system evolution?

Transdisciplinarity In the university there are disciplines, in the real world there are problems Communication and understanding across disciplines is essential Communication with sectors outside of academia is essential: government, civic institutions, business

Avoiding Academic Autism What is Autism? A disorder characterized by: –abnormal subjectivity –marked deficits in communication and social interaction –marked withdrawal from reality –abnormal behavior, such as… excessive attachment to certain objects

Objective truth seeking vs. action oriented research Traditional role is neutral scientist, unbiased objective research Sustainability demands solutions now. We need to do research that matters and we need to communicate and apply its results.

Focus on Synthesis… Communication across disciplines Integrating different perspectives Policy implications

… and Communication Communicate to those who act on information Format appropriate to goal