Shared Value Creation notes
Week 1
Lecture 1 - Sustainability introduction
Sustainability emphasises several aspects:
- Limits to growth
- Intergenerational aspects
- Transitions (behavioral and technological)
- What is fair?
= wicked problem
What are the concerns?
- Industrial waste
- Consumer and commercial waste
- Non-regenerative resources (exhaustibility of fossil fuels)
- Regenerative resources (fishing)
- Topics: climate change, air quality, geopolitical tensions, global dependencies,
inequalities (of access and ownership)
Towards a solution, what’s involved?
- Care for future generations
- Central role for institutions at local and global level
- New ways of thinking and perceiving
- Seeing systems
- Collaborating across boundaries
- Creating beyond reactive problem solving
- Problem unfolding slowly → slow reactive solving. Such as climate
change
- Need for solid evidence base
Collaboration?
- Needed, but difficult. There are different languages (in terms of different backgrounds),
energy efficiency paradox → need to merge technology and behavior
,Lecture 2 - The role of technology and productivity
Sustainability problems facing nowadays are global; emerging economies like Brazil, Russia,
India and China should be emphasized.
- China has faced a rapid industrialization process → nowadays we rely on the production
in China
- Who should we hold responsible for the GDP in a country, when it is being consumed
somewhere else?
European and Dutch context
- Emphasis on smart growth, and also needed on sustainable and socially inclusive
growth
- Netherlands laggard (achterblijver)
- For example, energy intensity of industry is less decreased than the OECD,
which means that the Dutch industry is transforming very slowly
- Policy highly volatile
- Several initiatives to foster technological change
- From kyoto to paris to trump to timmermans and beyond
Growth, environment and technology; there’s a need to understand the link between growth,
emissions, material use, etc.
- Country or firm as a production function:
So, total amount of emissions = function of the total amount of economic activity, (or emissions)
and you can decompose it in different types of activities or sectors, such as the cultural sector,
service sector, agricultural sector.
^ Volume (Y)= for example, the GDP, to decrease this, degrowth is needed (not popular)
^ Technology = all kinds of activities. Emission intensity of the activity that we have
^ Sectoral composition = share of economic activity in the total amount of economic activity? In
netherlands is relatively high due to the big steel industry
Emission intensity = Ei / Yi. in order to decrease this, intensity needs to decrease.
, Key messages:
- Limits to growth, unless
- Sectoral transformations towards less energy intensive sectors
- Or improvement of energy productivity
- Drivers: innovation, prices, trade, changing preferences, etc.
- Environmental Kuznets Curve
^ = Energy intensity
What you see is that almost all of the aggregate dynamics are driven by the technology effect,
which means that all sectors were using more energy than the year they did before. It is not the
case that we are moving increasingly towards energy intensive sectors. This shows that energy
intensity dynamics is more important than the composition effect.
How come that the Netherlands is doing so bad?
- Low energy prices
- Dutch disease type of explanation; being rich in natural resources can turn out to
be a disease in the longer run. Dutch industrial structure is dependent on natural
resources (that we had lots of), therefore, it is difficult to transform. This led to
welfare and wealth, but we are dependent now of something that is unrenewable
- Netherlands is gateway to Europe where we have a relatively big airport compared to the
size of the country/population
- Netherlands is a tax haven
- Uncertainty, partly caused by policy, which creates an option value of waiting (see next
lecture). However, we do not have much time so this moves us in the wrong direction.
- Advent (komst) of ICT, especially in the service sector which uses lots of energy
- Specialization in response to international trade
Lecture 2 - The energy efficiency paradox
There are many profitable technologies around that are still not being adopted. Why?
Week 1
Lecture 1 - Sustainability introduction
Sustainability emphasises several aspects:
- Limits to growth
- Intergenerational aspects
- Transitions (behavioral and technological)
- What is fair?
= wicked problem
What are the concerns?
- Industrial waste
- Consumer and commercial waste
- Non-regenerative resources (exhaustibility of fossil fuels)
- Regenerative resources (fishing)
- Topics: climate change, air quality, geopolitical tensions, global dependencies,
inequalities (of access and ownership)
Towards a solution, what’s involved?
- Care for future generations
- Central role for institutions at local and global level
- New ways of thinking and perceiving
- Seeing systems
- Collaborating across boundaries
- Creating beyond reactive problem solving
- Problem unfolding slowly → slow reactive solving. Such as climate
change
- Need for solid evidence base
Collaboration?
- Needed, but difficult. There are different languages (in terms of different backgrounds),
energy efficiency paradox → need to merge technology and behavior
,Lecture 2 - The role of technology and productivity
Sustainability problems facing nowadays are global; emerging economies like Brazil, Russia,
India and China should be emphasized.
- China has faced a rapid industrialization process → nowadays we rely on the production
in China
- Who should we hold responsible for the GDP in a country, when it is being consumed
somewhere else?
European and Dutch context
- Emphasis on smart growth, and also needed on sustainable and socially inclusive
growth
- Netherlands laggard (achterblijver)
- For example, energy intensity of industry is less decreased than the OECD,
which means that the Dutch industry is transforming very slowly
- Policy highly volatile
- Several initiatives to foster technological change
- From kyoto to paris to trump to timmermans and beyond
Growth, environment and technology; there’s a need to understand the link between growth,
emissions, material use, etc.
- Country or firm as a production function:
So, total amount of emissions = function of the total amount of economic activity, (or emissions)
and you can decompose it in different types of activities or sectors, such as the cultural sector,
service sector, agricultural sector.
^ Volume (Y)= for example, the GDP, to decrease this, degrowth is needed (not popular)
^ Technology = all kinds of activities. Emission intensity of the activity that we have
^ Sectoral composition = share of economic activity in the total amount of economic activity? In
netherlands is relatively high due to the big steel industry
Emission intensity = Ei / Yi. in order to decrease this, intensity needs to decrease.
, Key messages:
- Limits to growth, unless
- Sectoral transformations towards less energy intensive sectors
- Or improvement of energy productivity
- Drivers: innovation, prices, trade, changing preferences, etc.
- Environmental Kuznets Curve
^ = Energy intensity
What you see is that almost all of the aggregate dynamics are driven by the technology effect,
which means that all sectors were using more energy than the year they did before. It is not the
case that we are moving increasingly towards energy intensive sectors. This shows that energy
intensity dynamics is more important than the composition effect.
How come that the Netherlands is doing so bad?
- Low energy prices
- Dutch disease type of explanation; being rich in natural resources can turn out to
be a disease in the longer run. Dutch industrial structure is dependent on natural
resources (that we had lots of), therefore, it is difficult to transform. This led to
welfare and wealth, but we are dependent now of something that is unrenewable
- Netherlands is gateway to Europe where we have a relatively big airport compared to the
size of the country/population
- Netherlands is a tax haven
- Uncertainty, partly caused by policy, which creates an option value of waiting (see next
lecture). However, we do not have much time so this moves us in the wrong direction.
- Advent (komst) of ICT, especially in the service sector which uses lots of energy
- Specialization in response to international trade
Lecture 2 - The energy efficiency paradox
There are many profitable technologies around that are still not being adopted. Why?
