IB DP Economics: Sustainable development

This guide follows the IB Diploma Programme Economics guide (first assessment 2022, published February 2020), the course examined from the 2022 session onwards. It covers sub-topic 4.7, sustainable development, in Unit 4 The global economy. The meaning of sustainable development and the Sustainable Development Goals are SL and HL. The relationship between sustainability and poverty is HL only and is marked that way below. Every country, resource and figure in the worked examples is invented and illustrative.

Use the IB DP Economics hub and the printable checklist to track your progress. Quick recall is in the revision notes and exam-style work is in the practice set. To find weak spots first, take the free diagnostics.

What 4.7 asks of you

Content	What you must be able to do	SL / HL
The meaning of sustainable development	Explain the idea and apply it to a resource or an economy	SL and HL
Sustainable Development Goals	Describe the goals and apply them to a situation	SL and HL
Relationship between sustainability and poverty	Analyse how poverty and environmental pressure affect each other	HL only

The guide sets the depth of teaching for all three rows at the application and analysis level (AO2). It also says a question may not use a command term pitched above the level set for the content. So for 4.7 expect terms such as “explain”, “distinguish”, “analyse”, “apply” and “suggest”, and expect lower-level terms such as “define” and “outline”. Questions that ask you to weigh up how far the goals have been met in particular countries belong to 4.10, not here.

The unit also names a conceptual understanding that matters for this topic: the pursuit of sustainability is subject to various constraints. A strong answer says what limits a country, not only what it should do. The guide adds that effective strategies take account of the social, economic and political context.

The meaning of sustainable development

The guide defines sustainability in economics as the present generation meeting its needs while leaving later generations able to meet theirs. It adds that this means limiting economic activity that causes resource depletion or degradation that would harm future generations.

Sustainable development applies that idea to development: raising living standards in a way that can continue. Three points sit inside it.

• Present needs. People today must be able to meet their needs. A policy that leaves the poor worse off now is not a full answer.
• Future needs. The stock of resources and the quality of the environment passed on must not be run down so far that later generations cannot live as well. This is a question of fairness between generations.
• A link between aims. Higher output, fairer outcomes and a healthy environment are often grouped as economic, social and environmental aims. They can support each other. They can also conflict.

Renewable and non-renewable resources

Sustainability looks different for the two types of resource.

A renewable resource (a fish stock, a forest, an aquifer that refills) regenerates. Use is sustainable if the amount taken each year does not exceed the regeneration. Taking more shrinks the stock, which lowers future regeneration as well.

A non-renewable resource (a mineral deposit) does not regenerate on any useful timescale. Any extraction reduces what is left, so sustainability depends on how long reserves last, whether substitutes and recycling are developed, and what is done with the income earned.

The market tends to over-use resources that nobody owns or that carry an unpriced cost. That link to common pool resources and external costs is covered in the unit on externalities and common pool resources.

Worked example 1: a renewable resource (calculator-free)

Lorvane Bay is an invented fishing ground. Its fish stock is 200,000 tonnes and the stock regenerates by 6% of its size each year.

1. Regeneration = 6% × 200,000 = 12,000 tonnes a year. A catch of 12,000 tonnes keeps the stock level, so it is the sustainable catch at this stock size.
2. The fleet instead catches 18,000 tonnes a year. The excess over regeneration is 18,000 − 12,000 = 6,000 tonnes a year.
3. Stock after year 1 = 200,000 + 12,000 − 18,000 = 194,000 tonnes.
4. In year 2 regeneration is 6% × 194,000 = 11,640 tonnes. Stock after year 2 = 194,000 + 11,640 − 18,000 = 187,640 tonnes.
5. In year 3 regeneration is 11,258.4 tonnes and the stock falls to about 180,898 tonnes. The sustainable catch has fallen to about 10,854 tonnes.

The lesson is that over-use compounds. The stock falls, so regeneration falls, so the same catch takes a larger share of what is left. Today’s income is bought with future income, which is the opposite of the guide’s definition.

Worked example 2: a non-renewable resource

A fictional country, Veltmark, has 480 million tonnes of mineral ore.

1. If it extracts 12 million tonnes a year, the reserves last 480 ÷ 12 = 40 years.
2. If extraction rises by 5% a year, cumulative extraction after n years is 12 × (1.05ⁿ − 1) ÷ 0.05. Setting this equal to 480 gives 1.05ⁿ = 3, so n is about 22.5. After 22 years about 462 million tonnes are gone and after 23 years about 497 million would be needed. The ore runs out in the 23rd year, not the 40th.
3. If recycling meets 25% of demand, mining needs fall to 75% × 12 = 9 million tonnes a year, and the reserves last 480 ÷ 9 ≈ 53.3 years.

Recycling extends the life of the deposit but does not make extraction sustainable for ever. It buys time for substitutes.

Sustainable Development Goals

The Sustainable Development Goals (SDGs) are a set of 17 global goals agreed by United Nations member states in 2015, with 2030 as the target date. Each goal has more detailed targets beneath it. The guide lists the goals as a content item in 4.7 and refers to several of them elsewhere, including poverty, reduced inequalities, decent work and economic growth, innovation and infrastructure, and responsible consumption and production.

The 17 goals, grouped by the main aim they serve, are below. The grouping is a study aid only.

Main aim	Goals
Ending deprivation	1 No poverty; 2 Zero hunger; 3 Good health and well-being; 4 Quality education; 5 Gender equality; 6 Clean water and sanitation
Economic base	7 Affordable and clean energy; 8 Decent work and economic growth; 9 Industry, innovation and infrastructure; 10 Reduced inequalities
Living within limits	11 Sustainable cities and communities; 12 Responsible consumption and production; 13 Climate action; 14 Life below water; 15 Life on land
Institutions and cooperation	16 Peace, justice and strong institutions; 17 Partnerships for the goals

How to apply the goals

“Apply” means using the goals on a given case. Follow three steps.

1. Match. Name the goal or goals the case touches, by number and title.
2. Link. Explain how the policy or event moves the country towards or away from that goal.
3. Connect. Say whether the goals support each other or conflict in this case.

Goals often support each other. Better education (goal 4) raises skills and incomes, which helps goal 1. Clean water (goal 6) improves health (goal 3). Goals can also pull apart. Goal 8 growth driven by burning more fossil fuel works against goal 13. A new road improves access for farmers (goal 9) but may cut through forest (goal 15).

Worked example 3: applying the goals

Veltmark opens a large timber export business. It employs 4,000 workers on wages above the local average, but it clears forest faster than the forest regrows.

• Supports: goal 8 (jobs and growth) and probably goal 1 (more households above the poverty line).
• Works against: goal 15 (life on land), and possibly goal 13 if the lost forest stored carbon.
• Connection: the goals conflict in the short run. An answer earns more credit when it says the jobs are real but depend on a stock that is shrinking, so the gain to goal 8 may not last.

Relationship between sustainability and poverty (HL only)

HL only. The guide lists this relationship at the same depth as the rest of 4.7. The link runs in two directions, and you should be able to analyse both.

Poverty can push towards unsustainable use

• Short time horizon. A household that cannot be sure of its next meal values income today far above income in ten years. Cutting a woodland for fuel or income is rational for the household even though it is costly for the group.
• Few alternatives. Without access to affordable energy, credit or other land, poor households depend directly on local resources: wood, soil, water, fish.

Environmental damage can deepen poverty

• Falling fish catches, soil exhaustion or a dry well lower the incomes of the households that depend on them.
• Poor households often live on the land most exposed to flood, drought and pollution and have the least ability to recover.
• Health costs from polluted water or smoky fuel reduce the ability to work and to learn.

Together the two directions can form a vicious circle: poverty leads to over-use, over-use degrades the resource, and a degraded resource creates more poverty. The circle can also run the other way: less poverty eases pressure on a resource, and a recovering resource lifts incomes.

Worked example 4: a village and its woodland (HL only)

Brimble is an invented village of 300 households. Each burns 2.4 tonnes of wood a year. The nearby woodland holds 4,800 tonnes and regrows 600 tonnes a year.

1. Demand = 300 × 2.4 = 720 tonnes a year.
2. Deficit = 720 − 600 = 120 tonnes a year taken from the stock.
3. If nothing changes, the woodland lasts 4,800 ÷ 120 = 40 years (a simplification, since regrowth would fall as the stock fell).
4. A scheme gives 60 households subsidised gas stoves at 150 sols each. The cost is 60 × 150 = 9,000 sols.
5. The 240 households still using wood need 240 × 2.4 = 576 tonnes, which is below the 600 tonnes of regrowth. The surplus is 24 tonnes, so the use is now sustainable.

This one policy attacks poverty and environmental pressure together, because the households keep their fuel supply without cutting into the stock. A strong answer would add a limit: the households must be able to afford the gas, or they may sell the stove and return to wood.

Constraints on the pursuit of sustainability

The guide names constraints without listing them, so these are the ones to be ready to explain with an example.

• Income and cost. Cleaner technology and conservation need funds that low-income countries may lack.
• Time horizons. Costs of action arrive now and benefits later, but governments face elections and households face daily needs.
• Global nature. Emissions and fish stocks cross borders. A country that acts alone bears the cost while others gain, which weakens the incentive to act.
• Measurement. Environmental limits and future needs are hard to measure with certainty.
• Competing goals. Spending on one goal may be at the expense of another.

Common errors

• Defining sustainable development as “growth that lasts”. The definition is about meeting needs now without harming future needs.
• Treating the goals as a list to recite. Marks come from applying them to the case.
• Calling any resource use “unsustainable”. Use of a renewable resource at or below its regeneration is sustainable.
• Forgetting that poverty is a cause and a consequence of environmental pressure.

Next steps

Try the practice set, then use the revision notes. The wider course map is in the IB DP Economics syllabus guide, and poverty measures are in inequality and poverty. Check your readiness with the free diagnostics.

Official syllabus

Source: Economics guide, IB Diploma Programme, first assessment 2022 (International Baccalaureate Organization, February 2020). Sub-topic 4.7.