True Value economics – Aligning and decoupling, 2014

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Currently economic growth (GDP) is positively correlated with growing unsustainable resource use and environmental impact and with a poorly understood connection between GDP and human well-being. This is Business as Usual (BaU).

Bending the trends

Above: Aligning and decoupling (from UNEP/EEA 2011).
The aligning goal illustrated in this figure is to have GDP highly correlated with well-being.
The decoupling goal is to reduce resource consumption associated with GDP and to have negative environmental impact (i.e. an increase in GDP results in a net increase in environmental quality).

To achieve the goals in the above figure, the current external costs and benefits of human well-being, resource use and environmental impact willl be internalised into the value of the economy. This is a True-value Economy. We believe the transition is inevitable but the sooner it is started the least disruption will be caused. Already longer term investments would benefit from such a transition.

September 2014, MMG/SNJ