Economics, Policy, and Sustainable Development

Practice vocabulary flashcards for Chapter 5: Economics, Policy, and Sustainable Development, covering economic frameworks, historical eras of environmental policy, key legislation, and international environmental governance.

Framework of Environmental Policy Formation

A structural model demonstrating how science provides objective information and analysis to the government, private sector, and citizenry, while the public and private sectors influence government policy via lobbying, campaign funding, legal action, and voting to generate solutions to environmental problems.

Economics

The study of how humans use potentially scarce resources to meet demand.

Neoclassical economics

An economic school of thought based on psychological factors affecting consumer choices and seller strategies, which views market stability as a balance of supply and demand, assumes internal costs represent all transaction costs, and treats continuous growth as essential.

Internal costs

The direct costs and benefits borne exclusively by the buyer and seller participating in a market transaction.

External costs

Negative or positive impacts caused by market transactions that are borne by people or the environment not directly involved in the transaction, such as industrial pollution and environmental degradation.

Discounting

A neoclassical economic practice used to decrease the perceived importance and monetary value of future people, resources, and goods relative to present ones.

Ecological economics

A discipline asserting that economies are subsystems of natural systems and must mirror ecological principles, rejecting the idea of unlimited growth and advocating for steady-state economies.

Steady-state economy

An economy that neither grows nor shrinks, intentionally stabilized to mirror Earth's ecological carrying capacity, energy availability, and natural limiting factors.

Environmental economics

An economic field that modifies neoclassical economics by assigning monetary values to ecosystem services, accounting for external costs, and increasing efficiency to promote long-term sustainability.

Ecosystem services

Essential natural processes provided by healthy ecosystems—such as crop pollination, groundwater recharge, water purification, and nutrient cycling—that sustain life and economic systems.

Gross Domestic Product (GDP)

The total monetary value of all goods and services produced by a nation over a given time period.

Genuine Progress Indicator (GPI)

An alternative economic metric of national progress that adds positive nonmonetary contributions (such as volunteer work) and subtracts negative impacts (such as pollution damage and crime).

Natural capital

The accumulated combination of Earth's natural resources and ecosystem services that sustain human life and economic activity.

Environmental policy

Official rules, regulations, and plans established by governments to promote human welfare and protect natural systems by regulating resource consumption and reducing pollution.

Tragedy of the commons

An economic scenario in which unregulated access to a shared, common-pool resource leads self-interested individuals to deplete or degrade the resource to the detriment of all users.

Administrative agencies

Executive branch government entities responsible for elaborating, implementing, and enforcing environmental legislation passed by Congress.

Yellowstone National Park

Established in 1872, the first national park created in the world.

Silent Spring

A 1962 book written by Rachel Carson that alerted the public to the dangers of chemical pollutants and industrial pesticides, helping ignite the modern U.S. environmental movement.

First era of U.S. environmental policy

A legislative era spanning the late 1700s and 1800s focused on managing public lands to encourage westward expansion and resource extraction.

Second era of U.S. environmental policy

A late-19th to early-20th-century policy period that responded to resource exploitation by setting aside public lands, creating forest reserves, establishing wildlife refuges, and forming national parks.

Third era of U.S. environmental policy

A mid-to-late-20th-century era driven by public concern over industrial pollution, resulting in federal legislation governing air quality, water quality, and toxic waste management.

National Environmental Policy Act (NEPA)

A 1970 federal statute that established the Council on Environmental Quality and required that an Environmental Impact Statement (EIS) be prepared for major federal actions significantly affecting environmental quality.

Environmental Impact Statement (EIS)

A comprehensive study and detailed report required under NEPA assessing the potential environmental impacts of proposed federal actions before projects can proceed.

Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA)

A 1980 U.S. federal statute that established the Superfund program to identify, regulate, and clean up abandoned hazardous waste sites.

World Bank

An international financial institution established in 1944 that provides funding and loans for global economic development, including major infrastructure projects in developing nations.

World Trade Organization (WTO)

An international institution that promotes free trade by lowering obstacles to international commerce and enforcing fair trading practices, frequently criticized for potentially weakening environmental standards.

Command-and-control

An environmental policy approach wherein the government sets statutory limits on pollution emissions and enforces compliance through punitive measures against violators.

Cap-and-trade

A market-based emissions control system in which the government sets an overall pollution ceiling and permits facilities polluting below their cap to sell excess credits to facilities polluting over the cap.

Ecolabeling

The practice of placing standardized labels on products to inform consumers of environmentally sustainable production practices and encourage green purchasing.

Greenwashing

The deceptive marketing practice of portraying a company or its products as environmentally friendly to obscure underlying unsustainable practices or cost-saving motives.

Sustainable development

Development that meets the needs of the present without compromising or sacrificing the ability of future generations to meet their own needs.

Triple bottom line

A sustainable development framework that simultaneously balances three core goals: economic advancement, environmental protection, and social equity.

Emergency Wetlands Resources Act (EWRA) of 1986

Federal legislation requiring the U.S. Fish and Wildlife Service to conduct decennial wetland status reports and establishing the Bayou Sauvage National Wildlife Refuge.

Green tax

A tax levied on activities, emissions, or products that cause undesirable environmental damage, designed to incentivize polluters to reduce their ecological impact.

Subsidy

A government giveaway of publicly owned resources, financial grants, or tax breaks designed to encourage targeted economic activities.