Technological change and globalization are major drivers that affect the environment, economy, and work. These three areas need to be addressed together in a coherent way. Strategic interventions are needed to change production and service systems, demand, and the financial system to improve economic welfare, employment, and the environment. Government, corporations, and consumers all have roles to play along a continuum from minimal to interventionist approaches. Technology-based strategies that consider employment, competitiveness, and the environment can help by expanding the scope of innovation.

1. PATHWAYS TO SUSTAINABLE
DEVELOPMENT:
Co-optimizing Economic Welfare,
Employment, and Environment
Nicholas A. Ashford, PhD, JD
Professor of Technology & Policy
Massachusetts Institute of Technology

2. Extraction
industries
Consumer
Manufacturing
Consumption
Agriculture
Transportation Commercial
Energy Consumption
Services
Government
Housing
Consumption
ICT PROBLEMS
Inadequate Goods & Services
Toxic Pollution
Climate Disruption
Resource Depletion
Biodiversity/Ecosystem Integrity
Environmental Injustice
Employment/Purchasing Power
Economic Inequity
SOLUTIONS
Education & Human Resource Development
Industry Initiatives
Government Intervention/Regulation
Stakeholder Involvement
Financing Sustainable Development

3. MAJOR SYSTEMIC PROBLEMS
Fragmentation of the knowledge base
Inequality of access to economic & political power
Tendency towards ‘Gerontocracy’
» technological and political ‘lock-in’
» usually, but not always, accompanied by concentration of
economic wealth and political power
Market imperfections -- prices don’t reflect real costs
of goods and services
Limitations of perfectly-working markets
» Disparate time horizons - costs now, benefits later
» Delay in recognizing problems (Limits to Growth)
» Inappropriate production & consumption patterns
Failure to engage individuals in the society to realize
their human potential ~ social exclusion
Corruption

4. Factor Endowments
Land
Material Resources (natural and physical capital)
Energy
Labor capable of performing physical labor
Know-how (intellectual human capital)
[innovation systems][1]
Built capital (bridges, roads, rail systems, ports, dams ~ infrastructure)
Information and Communication Technology (ICT)
(Health and Environment)[2]
Structural capital (knowledge and productive routines held by
organizations)
Networks and Outsiders (linking organizations, people, and entrepreneurs)
Social capital (knowledge held by consumers and citizens)
1] Universities, research institutions, technology and knowledge transfer
agencies, human resource development institutions.
[2] Good human health (both physical and mental) and an unpolluted and
preserved environment (what could be called ‘environmental capital’) are
increasingly regarded as essential for maintaining the productiveness of
human and natural/physical capital.

5. Economic Welfare, Employment,
and the Environment
Are all affected by both technological
innovation and globalized trade
Are in a fragile balance
Are inter-related and need to be addressed
together in a coherent and mutually
reinforcing way

6. Environment
Technological
change &
globalization
(trade)
Work Economy
Copyright © 2006 by Nicholas A. Ashford.
Technological change and globalization (trade) as drivers of
change within and between three operationally-important
dimensions of sustainability

7. The Importance of Work
and the Workplace
Work is combined with physical and natural capital to
produce goods & services.
The workplace is the place where comparative advantag
is exchanged - i.e., a marketplace.
Work is the main means of distributing wealth and
creating purchasing power.
Work provides a means of engagement in the society.
The workplace provides an important social environment
and mechanism for enhancing self esteem.
Industrial & economic policy, trade policy, and
environmental policy have important consequences for
employment and OH&S

8. Improving labor Productivity
increase worker skills
» increase labor productiveness
» rewards to workers are increased
use/develop better hardware, software, and
manufacturing systems
» increase capital productiveness
» workers’ share of profits are decreased
better matching of labor with natural/physical capital,
and with information & communication systems
» increase joint labor and capital productiveness
» rewards are increased for both owners and workers
» human-centered knowledge-based work has the potential, if
designed properly

9. Theoretical implications of decreasing labor conten
for employment and for the environment
Lower costs of goods and services
Lower prices
Increased demand and sale of goods and services
» in the original industry/market
» in new markets (influenced by increases in disposable
income and producer-created demand)
Are more workers hired than displaced?
» It depends on whether growth in production outstrips
(capital) productiveness growth
May require or stimulate a continual throughput
economy with increasing consumption
» => adverse effects on environmental sustainability

10. Strategic Interventions
Change Production & Service Systems (meet needs in a new wa
– Dematerialization, energy-efficiency, new energy sources, pollution/waste
prevention
– Shift to re-manufacturing & product services (e,g, photocopy machines, cars)
– System changes, e.g., in manufacturing, transportation, housing, agriculture
– Tax/regulate pollution and energy use
– Remove ‘head taxes’ from labor, e.g., health care, unemployment insurance
– Change labor/capital mix from manufacturing to services utilize higher skills
and labor inputs
– Reward and incentivize innovation
Change Demand
– Education, use of counter-advertising & regulating commercial advertising
– Constrain consumption by using tax policy
Change Finance System
– Banking, lending, and mortgage regulation
– Tobin tax on currency speculation
Education and Human Resource Development (supply & demand
– Affecting political and purchasing choices/upskill workers
Create meaningful, rewarding, and safe jobs (not by trickle-down)

11. I
Toxic Pollution
Climate Change
Ecosystem Disruption
Resource Depletion
VI Environment II
● Increased environmental ● Development & environment
footprint from the need to (industrialization)
increase employment & ● Investment & environment
industrial throughput
● Trade & environment
● Environmental/energy ● Regulation of Health, Safety &
Technological
improvements create or Environment Affects the Economy
change &
change the nature of and Growth.
globalization
employment.
● Skills
Work Economy
● Wages ● Changing international
● Purchasing Power ● Improvements in competitiveness,
division of labor
● Job Security productiveness, and the use of physical,
● Health and Safety natural, & human capital
● Changes in the nature of
● Job Satisfaction ● Economic changes (arising from labor
work
● Number of Jobs replacement & capital relocation
● Financing growth and development
V IV III

12. Roles of Government Roles of Corporations
Continuum Continuum
Minimal State/ Rawlsian Government Profit Maximization Corporate Social and
Utilitarianism Government acts as Capitalist (laissez Environmental
Capitalist (laissez trustee for stakeholders; faire) approach Responsibility (CSER)
faire) approach to Interventionist approach Sustainable
policy and markets to policy and markets Citizen & Industrialization
NGO
Concerns
Shareholders’
Roles of Consumers
Continuum
Concerns
‘Value’ Consumers Green Consumers
Purchasing based Purchasing based upon
upon the price and the environmental and
perceived value of social impacts of
products and services products and services
ifferent Operating Postures that might be adopted by Government, Corporations,
Consumers in the Context of Citizen, NGO, & Shareholder Scrutiny

13. TECHNOLOGY-BASED STRATEGIES FOR IMPROVING
PRODUCTIVENESS, EMPLOYMENT, and
HEALTH, SAFETY, & THE ENVIRONMENT
SHIFT ATTENTION FROM PROBLEMS TO SOLUTIONS
» Technology Options Analysis vs.Technology/Risk Assessment
DESIGN AND IMPLEMENT COMPREHENSIVE TECHNOLOGICAL CHANGES
» to improve productiveness, employment and health, safety, and the environment
● EXPAND THE SCOPE OF INNOVATION AND THE DIMENSIONS OF THE ’DESIGN SPACE’
- ‘design space’ refers to the dimensions along which the designers of technical/social
systems concern themselves
- expanding the available socio-technical design space includes simultaneous consideratio
of the determinants of competitiveness, environment, and employment
- distinguish between ‘sustaining (incremental) innovation’ and ‘disrupting (radical)
innovation’
- the needed major product, process, product services, and system transformations may be
beyond those that the dominant industries and firms are capable of developing easily, at lea
by themselves
● ADDRESS ALL DIMENSIONS OF INNOVATION:
- technological, organizational, institutional, and social factors
REQUISITES FOR CHANGE: Willingness, Opportunity/Motivation, & Capacity/Capability
INTEGRATION, NOT MERELY COORDINATION, OF EFFORTS IS ESSENTIAL