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Devolution, sustainability and GDP convergence: Is the Welsh agenda achievable?

2006; Routledge; Volume: 40; Issue: 6 Linguagem: Inglês

10.1080/00343400600868994

1360-0591

Lynn Mainwaring, Richard Jones, David Blackaby,

Fiscal Policy and Economic Growth

Abstract Mainwaring L., Jones R. and Blackaby D. (2006) Devolution, sustainability and GDP convergence: is the Welsh agenda achievable?, Regional Studies 40, 679–689. The Welsh Assembly Government has a constitutional duty to promote sustainable development. The devolution settlement does not, however, empower the Assembly to deviate from UK tax rates, while the Assembly Government has itself adopted ambitious gross domestic product growth targets. Here, the paper considers notions of sustainability and it attempts to place the Welsh agenda within those conceptual approaches. It then discusses the significance of the absence of tax variation as an instrument for generating relative sustainability gains. In particular, it examines the regional relevance of the ‘double-dividend’ argument that governments can substitute efficient environmental taxes for inefficient labour-market taxes. Finally, it considers the implications for sustainability of promoting quality of life, or happiness, achievement above the gross domestic product as the main goal of policy. The lessons drawn should be of relevance to other semi-autonomous regions. Mainwaring L., Jones R. et Blackaby D. (2006) La régionalisation, le développement durable et la convergence du PIB: le programme gallois, est-il réalisable?, Regional Studies 40, 679–689. L'Assemblée galloise se voit attribuer en droit constitutionnel la promotion du développement durable. Néanmoins, l'accord sur la régionalisation ne donne pas à l'Assemblée le droit de s'écarter des taux d'imposition en vigueur au R-U, alors que l'Assemblée elle-même a visé des objectifs ambitieux pour ce qui est du PIB. Cet article cherche à examiner des notions de développement durable et à relativiser le programme gallois par rapport à ces approches conceptuelles. Il s'ensuit une discussion de l'importance du manque de variation fiscale comme outil qui engendre des gains relatifs dus au développement durable. En particulier, on examine l'importance régionale de l'argument en faveur du ‘double dividende’, à savoir les gouvernements peuvent substituer des taxes écologiques efficaces au taxes du travail inefficaces. Pour finir, on considère les retombées pour le développement durable de la promotion de la qualité de la vie, ou du bonheur, par-dessus le PIB comme but principal de la politique. Les leçons ainsi tirées devraient présenter de l'intérêt pour d'autres régions semiautonomes. Pays de Galles Régionalisation Développement durable Double-dividende Bonheur Mainwaring L., Jones R. und Blackaby D. (2006) Machtübertragung, Nachhaltigkeit und Konvergenz des Bruttoinlandsprodukts: ist das walisische Programm durchführbar?, Regional Studies 40, 679–689. Die Regierung der Parlamentarischen Versammlung von Wales hat die in der Verfassung verankerte Pflicht, nachhaltige Entwicklung zu fördern. Das Übereinkommen der Machtübertragung befähigt die parlamentarische Versammlung jedoch nicht, von den Steuersätzen des UK abzuweichen, obschon die Regierung der parlamentarischen Versammlung sich selber ehrgeizige Wachstumsziele für das Bruttoinlandsprodukt gesetzt hat. Der vorliegende Aufsatz geht auf Vorstellungen der Nachhaltigkeit ein und versucht, das walisische Programm in diesen begrifflichen Ansatz einzuordnen. Dann folgt eine Diskussion der Bedeutung fehlender Steuerunterschiede als Instrument zur Schaffung einer verhältnismäßigen Zunahme der Nachhaltigkeit. Insbesondere wird die regionale Zunahme des Argumentes der ‘doppelten Dividende’ untersucht, das Regierungen gestattet, unwirksame Arbeitsmarktsteuern durch effiziente Umweltsteuern zu ersetzen. Abschliessend werden die Implikationen für die Nachhaltigkeit der Förderung der Lebensqualität, bz.w.des Erreichens einer Zufriedenheit über das Bruttosozialprodukt hinaus als Hauptziel der Bestrebungen besprochen. Wales Machtübertragung nachhaltige Entwicklung doppelte Dividende Zufriedenheit Mainwaring L., Jones R. y Blackaby D. (2006) Transferencia de competencias, sostenibilidad y convergencia del PIB: ¿Se puede alcanzar el programa de Gales?, Regional Studies 40, 679–689. El Gobierno de la Asamblea de Gales tiene el deber constitucional de fomentar el desarrollo sostenible. Sin embargo, la transferencia de competencias no implica que la Asamblea esté capacitada para desviarse del tipo de gravamen que se aplica en el Reino Unido, y al mismo tiempo el Gobierno de Gales ha adoptado ambiciosos objetivos de crecimiento del PIB. En este documento consideramos las nociones de sostenibilidad e intentamos ubicar la agenda de Gales en estos planteamientos conceptuales. Asimismo analizamos en qué medida es importante la ausencia de una variación fiscal como instrumento para generar beneficios relativos de sostenibilidad. En concreto, examinarmos la relevancia regional del argumento de ‘doble dividendo’ según el cual los gobiernos pueden sustituir impuestos para el mercado laboral por impuestos eficaces para el medio ambiente. Para terminar, examinamos las implicaciones de la sostenibilidad en el fomento, por encima del PIB, de la calidad de vida o la felicidad como el objetivo principal de la política. Las enseñanzas extraídas deberían ser importantes para otras regiones semiautonómas. Gales Transferencia de competencias Desarrollo sostenible Dividendo doble Felicidad Keywords: WalesDevolutionSustainable developmentDouble-dividendHappiness Acknowledgements The authors would like to thank Huw Brodie and Michael Phelps (of the Welsh Assembly Government) and Gareth Wyn Jones for their observations and help with background information, and two anonymous referees for useful comments on the first draft of the paper. It needs stressing that the views expressed herein are those of the authors. Notes 1. The National Assembly for Wales, with powers devolved from the UK Parliament, was born on 1 July 1999. 2. Regular surveys on the current state of the Welsh economy are published in Contemporary Wales. The most recent is Brooksbank (2004) Brooksbank, D. 2004. The Welsh economy: a statistical profile. Contemporary Wales, 16: 178–204. [Google Scholar]. 3. Similar considerations apply to the sustainability remits of the English Regional Development Agencies (Gibbs, 1998 Gibbs, D. 1998. Regional development agencies and sustainable development. Regional Studies, 32: 365–381. [Taylor & Francis Online], [Web of Science ®] , [Google Scholar]) and UK local authorities (Gibbs et al., 1998 Gibbs, D., Longhurst, J. and Braithwaite, C. 1998. Struggling with sustainabilility: weak and strong interpretations of sustainable development within local authority policy. Environment and Planning A, 30: 1351–1365. [Crossref], [Web of Science ®] , [Google Scholar]). 4. This is the ‘race-to-the-bottom’ effect (e.g. Brown, 2001 Brown, D. K. 2001. Labour standards: where do they belong in the international trade agenda?. Journal of Economic Perspectives, 15: 89–112. [Crossref], [Web of Science ®] , [Google Scholar]). 5. It is true that some studies show that some types of intervention can lead to increases in employment where compliance is labour-intensive (e.g. Morgenstern et al., 2002 Morgenstern, R. D., Pizer, W. A. and Shih, J.-S. 2002. Jobs versus the environment: an industry-level perspective. Journal of Environmental Economics and Management, 43: 412–436. [Crossref], [Web of Science ®] , [Google Scholar]), but the overall evidence on employment effects is at best mixed (Jaffe et al., 1995 Jaffe, A., Peterson, S. R., Portney, P. R. and Stavins, R. N. 1995. Environmental regulation and the competitiveness of US manufacturing: what does the evidence tell us?. Journal of Economic Literature, 33: 132–163. [Web of Science ®] , [Google Scholar]). In any case, job creation is not the same as a net social benefit. The view of Porter and Van der Linde (1995) Porter, M. E. and Van der Linde, C. 1995. Toward a new conception of the environment–competitiveness relationship. 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The BHPS is a panel study of British households conducted annually by the Institute for Social and Economic Research, University of Essex, Colchester, since 1991. For more details, see Taylor et al. (2001) Taylor, M. F., Brice, J., Buck, N. and Prentice-Lane, E. 2001. British Household Panel Survey User Manual (A: Introduction, Technical Report and Appendices), Edited by: Taylor, M. F. Colchester: University of Essex. [Google Scholar]. 9. This, of course, depends on whether the corrections are necessary and sufficient and whether the corrective procedures are appropriate. Those adopted by Jackson et al. (1997) Jackson, T., Marks, N., Ralls, J. and Stymne, S. 1997. Sustainable Economic Welfare in the UK, 1950–1996, Guildford: Centre for Environmental Strategy. [Google Scholar] have been criticized by Neumayer (2000) Neumayer, W. D. 2000. On the methodology of ISEW, GPI and related measures: some constructive suggestions and some doubt on the ‘threshold’ hypothesis. Ecological Economics, 34: 347–361. [Crossref], [Web of Science ®] , [Google Scholar] and Crafts (2002) Crafts, N. 2002. UK real national income, 1950–1988: some grounds for optimism. National Institute Economics Review, 181: 87–95. [Crossref] , [Google Scholar]. Crafts, for example, dismisses the need for an equality correction, claims (following Neumayer) that corrections applied to emissions are flawed, and advocates positive allowances for technological progress and increased life expectancy. The present authors expect that this is a debate that has some way to run. The conceptual points made in this paragraph are not prejudiced by these arguments. 10. The present authors are grateful to the authors for making this series available to them. 11. See note 9.