WALL TO WALL, CRADLE TO CRADLE

CHAPTER 5 ENVIRONMENTAL ECONOMICS AND CONSUMPTION

A leading carpet company takes a chance on going green

What was it that Interface Carpets “just didn’t get”?

Why is it not enough, from an environmental point of

view, to simply comply with the law?

WHAT IS SUSTANABILITY?

To be sustainable means to be capable of being continued without degrading the environment.

________ is defined as development that meets present needs without preventing future generations from meeting their needs.

A. Sustainable developmentB. Ecological economicsC. The IPAT modelD. Natural interest

Clicker Question

Making sustainable development possible requires understanding:• Ecosystem goods and

services• Natural capital and natural

interest

• Economic models

• Internal and external costs

WHAT ARE ECOSYSTEM GOODS & SERVICES?

Environmental resources like timber and water are ecosystem goods.

Essential ecological processes like water purification and nutrient cycling that make life on Earth possible are ecosystem services.

NATURAL CAPITAL vs NATURAL INTEREST

WHAT IS ECONOMICS?

The social science that deals with how scarce resources are allocated.

It is about more than money as many resources and services we depend on come from the environment.

MAINSTREAM ECONOMIC MODEL

ASSUMPTIONS OF MAINSTREAM ECONOMICS

REALITIES OF THE EARTH’S ECOSYSTEMS

We can operate in a linear sequence

Natural and human resources are infinite or easily substitutable

Economic growth can go on forever

There is an “away”

Nature operates in cycles

Resources are not always infinite or easily substitutable

Ecosystems usually ready a steady-state

There is no “away”

ENVIRONMENTAL/ECOLOGICAL ECONOMIC MODEL

Both environmental and ecological economics consider the long-term impact of our choices on human society and the environment, and involve:

closed loop systems with renewable resources

more efficient resource use

reduction in waste generation

Ecological economists

believe that our ingenuity will only take us so far, and

that economic growth does have limits; therefore,

we must significantly

change the way we do things in

order to become sustainable as a

society.

Environmental economists

believe that we can apply the

tools of modern economics to

solve environmental

problems and still enjoy unlimited

economic growth.

Ecological

Economics

Environmental

Economics

But there are differences….

One additional limitation of mainstream economics is that it does not take into account all potential costs.

Traditional economics tend to discount the future value of goods. The result is that:

A. ecosystems services become devalued.

B. short-term benefits outweigh long-term benefits.

C. ecosystem services become over-valued.

D. None of the above answers are correct.

Clicker Question

WHAT ARE INTERNAL, EXTERNAL, AND TRUE COSTS?

Internal Costs + External Costs = True Costs

Businesses and individuals impact the environment

with their economic decisions.

The measure of the impact is the known as the ecological footprint.

WHAT IS AN ECOLOGICAL FOOTPRINT?

Land needed to provide the resources for and assimilate the waste of a person or population.

Ecological footprints vary for different countries based on their population size and per capita impact.

To estimate the size of an ecological

footprint, researchers use the IPAT equation.

WHAT IS THE IPAT EQUATION?

I = (P x A) / T

However, the right

technology can actually decrease impact.

As population or affluence increase,

impact on the environment typically

increases.

Population (P), affluence (A), and technology (T) all affect how much of an impact an individual or population has on the environment.

I = P x A x T

How did Interface Carpets reduce its

environmental impact and become more

sustainable?

Interface developed TacTiles technology using biomimicry (they created carpet glue based on how a gecko lizard clings to walls)

Life-cycle analysis

taking inventory of energy and materials inputs and evaluating the environmental impact of the product

Interface adopted a cradle-to-cradle management strategy and slashed energy use by 43% per unit of production, and relied on recycled or bio-based ingredients for 40% of its raw materials.

Biomimicry

imitating nature’s patterns in the design of products

Interface reinvented itself as a part of the service economy by focusing on providing the consumer the service of its carpet, rather than selling it as a product.

“I didn’t know what it would cost, and I didn’t know what our

customers would pay, so it was a leap of faith. I knew we had to do this, but it was like stepping off of a cliff and not knowing where your

foot was going to come down.”

–Ray Anderson