Business as usual in the industrial age: (relatively) lean,green and eco-efficient?

This paper discusses the creation of wealth from polluting waste in market economies before the birth of the modern environmental movement. It challenges the widely held view that ecologically efficient business practices are a recent phenomenon. Based on a survey of historical literature, it suggests that ‘eco-efficiency’ has always been ‘business as usual’ in market economies.

The paper has two sections. The first section surveys some early English-language writings on the topic. The second section describes historical cases of resource recovery, illustrating in the process that economic profitability and pollution reduction have typically been far more compatible than is now believed.

The authors say that while there is no point in denying that many past situations have been problematic and that industrial production did indeed occasion significant damage, much evidence suggests that traditional economic incentives have often promoted the development of more benign practices overtime. In other words, creative entrepreneurs, managers and technicians have long understood that polluting emissions are a form of waste, which negatively affects profit margins.

Why do, then, so many sustainable development theorists now believe otherwise? The authors offer a few reasons. These include:

• despite much evidence to the contrary, perceptions of environmental degradation in advanced industrialised economies have become so dominant that most people simply cannot envisage that manufacturing firms have been cleaning up their act for almost two centuries
• the environmental record of some industries is indeed unimpressive, although the case can be made that many such situations can often be traced back to “perverse subsidies,”which reward less efficient practices, or a lack of well-defined private property rights
• current inhabitants of advanced economies who have grown up surrounded by fossil-fuel-based synthetic products cannot readily imagine that earlier products fulfilling the same purposes were often made of animal and vegetable residues