Global Sustainability: Social and Environmental Conditions (review)

BOOK REVIEW Global Sustainability: Social and Environmental Conditions by Simone Borghesi and Alessandro Vercelli New York: Palgrave Macmillan, 2008, $90 cloth, 288 pp. The consequences of globalization have been among the most hotly debated topics in economics for a long time. Globalization scares the environmentalist and the lowskilled worker but provides new opportunities for innovative entrepreneurs and profit-seeking investors. Several popularpress books discuss either the virtues or the vices of the globalization process, trying to convey some strong message. In contrast, academic research typically focuses in some 20 pages on highly abstract models or the empirics of a single, very limited aspect of globalization. This book tries to fill the gap between these two extremes: its authors want to review concepts, theories, and observed outcomes in a fashion that is ‘‘as rigorous as possible, avoiding prejudice and groundless simplification’’ (p. ix), to survey the impact of globalization on environmental degradation, health, inequality, poverty, and financial stability. Two main aspects of sustainable development are distinguished. First, the (intratemporal ) social dimension of sustainability is defined as equal income distribution, good health, and absence of poverty. Second, the (intertemporal) environmental dimension is characterized as maintaining environmental quality over time, corresponding to the concept of strong sustainability. The book’s main question is whether globalization—the progressive integration of world markets—makes sustainable development easier to achieve. Borghesi and Vercelli base their answers to this huge question mainly on empirical cross-country studies. They approach the literature from their own reasonably strong but not inflexible view. The main premise is that in the long run it is in the interest of entrepreneurs and consumers to prevent environmental degradation and income inequality. Globalization can make world citizens better off, provided social and environmental conditions do not worsen: social and environmental sustainability are the prerequisites for the globalization process to be successful and sustainable. The relevant question therefore becomes whether the actual globalization process, the enlargement of markets for goods and services and increases in mobility of production factors, did not make it more difficult to fulfill the social and environmental prerequisites for sustainable development. The main body of the book does not pay much explicit attention to globalization itself. Rather, it concludes that globalization increases economic activity and then quickly goes on to discussing the relationship between economic growth, on the one hand, and poverty, health, and environment , on the other hand. Kuznets’s original hypothesis on the relationship between income and inequality is discussed and extended to measures of (absolute) poverty. The recent studies by Dollar/Kraay and Bourguignon/Morisson receive a central position. The general picture is emerging that, on average, withLand Economics N August 2009 N 85 (3): 552–554 ISSN 0023-7639; E-ISSN 1543-8325 E 2009 by the Board of Regents of the University of Wisconsin System in-country inequality has hardly changed over the past decades and that it is hardly correlated with policy or openness. This is remarkable, since much of the early debate on globalization started from the claim that globalization widened inequality. The environmental Kuznets Curve literature is reviewed to survey where the world economy is going in terms of environmental sustainability. The authors speculate about how globalization could move countries ‘‘along the Environmental Kuznets Curve’’ but do not discuss direct empirical links between globalization and environmental degradation. A survey of the empirics of the pollution haven hypothesis would have been useful here. A direct link between globalization and health seems far fetched. Yet globalization impacts health through the health-income relationship. Moreover, the authors show that relative income and other socioeconomic factors matter a lot for health outcomes in the middle-income countries. Chronic stress and feelings of insecurity affect health and performance of workers. Thus, when globalization increases job insecurity, development becomes less socially sustainable. The rapid spread of new technologies, mainly information and communication technologies, has shaped the economic developments in the 1990s. At the same time, new institutions have spread. The World Bank and the International Monetary Fund were forced to rethink their strategies, and the World Trade Organization established new rules, often in conflict with national environmental and labor standards. In Chapter 6, the authors call this the ‘‘new...