Preview
IB DP ESS — HL Lenses: Environmental Economics | HL | Paper 2B
🎯 Learning Intentions By the end of this note, you will be able to:
- Define economic growth, GDP, green GDP, and sustainable development using IB-aligned ESS and economics terminology.
- Explain the relationship between economic growth and environmental degradation, including the Environmental Kuznets Curve hypothesis.
- Distinguish between weak sustainability and strong sustainability as competing frameworks for managing natural capital.
- Analyse the limitations of GDP as a measure of welfare and environmental health, using ESS analysis parameters including scale, trade-offs, and multiple perspectives.
- Evaluate alternative economic models — including steady-state economics, circular economy, and doughnut economics — as frameworks for reconciling growth with ecological limits.
- Discuss contrasting worldviews (ecocentric, technocentric, anthropocentric) in relation to whether infinite economic growth is compatible with a finite biosphere.
- Justify the use of specific economic instruments and alternative indicators (e.g. HDI, GPI, Genuine Savings) to better capture sustainability outcomes.
Real-World Context & Relevance
In 2022, the global economy produced approximately US$100 trillion in goods and services — a figure that has roughly doubled since 2000. Yet in the same period, the WWF Living Planet Index recorded a 69% average decline in monitored vertebrate wildlife populations, global greenhouse gas emissions reached a record 57.4 Gt CO₂-equivalent, and the IPBES Global Assessment concluded that around one million species face extinction, many within decades. These two trajectories — rising GDP and accelerating ecological collapse — are not coincidental. They are structurally linked through the way modern economies extract, process, and discard natural resources at rates that exceed planetary regenerative capacity.
The tension is particularly stark in rapidly industrialising economies. China's GDP grew by more than 1,000% between 1990 and 2020, lifting hundreds of millions out of poverty — a genuine human achievement. But over the same period, China became the world's largest emitter of CO₂, lost over 20% of its wetland area, and saw severe degradation of major river systems including the Yellow River. Meanwhile, high-income nations that have already industrialised often point to declining domestic pollution levels as evidence that growth eventually becomes environmentally benign — a claim that, as we will see, requires careful scrutiny. The central question of this topic is not whether economic activity matters, but whether the current model of growth is compatible with long-term ecological and social sustainability.
🌍 Why This Matters The relationship between economic growth and environmental sustainability sits at the heart of every major international environmental agreement — from the Paris Agreement to the Convention on Biological Diversity. Understanding the economic drivers of environmental degradation, and the instruments available to redirect economies toward sustainability, is essential for any student of ESS engaging with real-world environmental decision-making.
Core Concepts & Definitions
To understand why economic growth and environmental sustainability are so often in tension, we need to begin with what economic growth actually measures — and what it does not. Most nations and international institutions use Gross Domestic Product (GDP) as the primary indicator of economic performance. GDP measures the total monetary value of all goods and services produced within a country in a given period. It is a measure of throughput — of how much economic activity is occurring — not of welfare, equity, or ecological health.
📖 Key Definition — Gross Domestic Product (GDP) GDP (Gross Domestic Product) is the total monetary value of all final goods and services produced within a