Page 8

vi

CONTENTS

3

Green Innovation and Industrial Policies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65 Innovation policies: Tailoring mixes of instruments to a country’s innovation potential . . . . 67 Green industrial policies: Ensuring that the standard caveats apply . . . . . . . . . . . . . . . . . . . . 80 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86

4

Human Capital: Implications of Green Growth Policies for Labor Markets and Job Creation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 Green policies may create jobs, but are no substitute for sound labor markets . . . . . . . . . . . . 92 But environmental regulation need not kill jobs either . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96 Smoothing the transition to greener growth paths for the labor market . . . . . . . . . . . . . . . . . 99 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102

5

Natural Capital: Managing Resources for Sustainable Growth . . . . . . . . . . . . . . . . . . . . . . 105 Extractable renewable resources: Defining property rights and moving up the value chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107 Cultivated renewable resources: Innovation, sustainable intensification, and integrated landscape approaches . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113 Nonprovisioning services: Creating knowledge and markets for economic valuation. . . . . . 117 Nonrenewable resources: Promoting rent recovery and reinvestment . . . . . . . . . . . . . . . . . . 123 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127

6

Physical Capital: The Role of Infrastructure in Green Growth Strategies . . . . . . . . . . . . . . 133 Infrastructure as the heart of green growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134 Recognizing the need for efficiency: Meeting large unsatisfied infrastructure needs within tight fiscal constraints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139 Minimizing the potential for regrets and maximizing short-term benefits . . . . . . . . . . . . . . 149 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150

7

Crafting a Green Growth Strategy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153 The challenges of developing a green growth strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154 A step-by-step process for crafting a green growth strategy . . . . . . . . . . . . . . . . . . . . . . . . . 158 Uncertainty and the need for robust decision making . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169

Boxes O.1 O.2 O.3 O.4 O.5 O.6 1.1 1.2 1.3

What is the aggregate economic support to the (over)use of natural capital? $1 trillion to $1.2 trillion annually . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 The many ways in which green policies can contribute to growth . . . . . . . . . . . . . . . . . . 11 Why “grow dirty and clean up later” is misleading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Morocco: The importance of political economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 “Green” cash transfers are helping poor communities in the Brazilian Amazon . . . . . . . 24 Joining forces: A common platform to move forward on greening our economies and growth processes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Persistent concerns about local pollution in high-income countries . . . . . . . . . . . . . . . . . 32 An economic framework for green growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Using individual transferable quotas to revitalize fisheries . . . . . . . . . . . . . . . . . . . . . . . . 38

Inclusive Green Growth  

As the global population heads toward 9 billion by 2050, decisions made today will lock countries into growth patterns that may or may not b...