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Environmental Economic Geography

May 16, 2009

Environmental economic geography (EEG) bridges the divide between anthropocentrism and ecocentrism and assesses the interplay between the economy and the environment in a methodological way that neither environmental geography nor economic geography can fully accomplish. With an increasing recognition of the interconnectedness of global ecological conditions and phenomena, a geographical perspective is vital in analyzing the environmental impact of economic activity. As an outgrowth of the sustainable development movement, the environment is evolving from the realm of externality (Bridge, 2007) to a topic of explicit consideration in regards to cost-minimization and profit-maximization in the business arena (Stormer, 2007). Under this new regime, economic modeling tools geared towards valuing land types and land use at varying scales is a critical component of EEG that seeks to integrate an environmental awareness into traditional economic geography (Hanink, 1995).

A geographical perspective has long been a powerful tool in determining the economic potential of a particular project, firm location, or resource utilization. Profitability is largely determinant on the ability to bring goods to the largest number of customers while minimizing transportation expenditures and acquiring inputs in the most cost effective manner (Krugman, 1991). With these goals in mind, an analysis of market proximity, industry agglomeration, and firm scale is paramount (McCann, 2004). The flow of goods from point A to Point B, whether these points lie within a neighborhood, a state, a country, or are separated by oceans, is not happenstance (Krugman, 1991). The locations of businesses and distribution networks, both regionally and internationally, will largely determine whether a firm thrives or fails within the market economy (Hanink, Geographic Change with Trade Based on Comparative Advantage, 2005).

Like the economy, the interaction between humans and the environment can be evaluated from a spatial perspective. Our ability to alter the natural world at a micro level is nearly infinite, and we have so wholly shaped the landscape that “natural” is little more than a description of a human perceived best use for a piece of land. Regions that remain “wilderness” or “unspoiled” generally exist in that state through sociopolitical intervention rather than through any lack of human geographic expansion (Platt, 2004). The meadow that grows where a forest once stood or the lake that teems with life where once only a river flowed are merely constructs of humanity’s nature, a nature that is defined in terms of human use. In this light, it’s important to evaluate how much and in what locations we decide to shape the world around us. Ideally, our decisions won’t be made based on how easily we can change the environment but on how we can avoid doing so.

There exist three implicit truths within the context of the economy and the environment that’s been defined thus far: that humanity’s ability to alter the environment is nearly absolute, that we have a responsibility to do so as minimally as possible, and that economic profit is a just and essential pursuit. From this simple foundation we can derive the maxim that development which earns the most profit while doing the least harm to the environment is the pinnacle of humanity’s growth. This framework can be instructive in guiding both public policy and business analyses, particularly from the standpoint of the modern “green” movement (Bridge, 2007). Modeling the geospatial characteristics of extractive industries and the resultant environment impact (Le Heron, 2007) is only one aspect in which the application of EEG could add value. The spatial distribution and the proximity and communication between firms within agglomeration economies can also play a significant role in knowledge transfer regarding environmentally-friendly technologies (Weiss, 2007; Kassinis, 2001). Furthermore, EEG can be instructive in advocating for the use of various public policies that encourage environmental sustainability through both regulationist and ecological modernization approaches (Gibbs, 2006).

While EEG is a valuable contribution to the discourse in economic geography, the subdiscipline also has the potential to foster the development of new methodologies that combine techniques from a number of fields (Bridge, 2007). An emerging tool in EEG is the use of geographic information systems and economic land valuations to model the environmental impact of land use decisions (Bastian, 2002; Heidkamp, 2007) while fully operating within the confines of the maxim that was specified earlier. Economic profit-seeking under this methodology is not constrained by rigid interpretations of cost-benefit analyses or strict environmental protectionism but is allowed to thrive with an added recognition of the spectrum of environmentally appropriate land use (Heidkamp, 2007). In this manner, development and sustainability are not mutually exclusive, but rather are allowed to evolve together in symbiosis (Hayter, 2008). Eventually, as ‘environmental economies’ such as carbon cap and trade programs continue to emerge and grow (Bridge, 2007), this relationship may proceed even further towards a state of mutualism where profit-seeking and environmental protection become simultaneously reinforcing policy and business objectives.

The growth of environmental economic geography is occurring alongside, and largely attributed to, the uncertainty surrounding the net social impact of rapid globalization. As an emerging field, there is yet no consensus in EEG as to the adoption or standardization of methodologies or policy approaches (Bridge, 2007). Rather than acting as a liability however, the diffuse nature of EEG research may be the discipline’s greatest asset by acting to reassess the assumptions of traditional economic geography (Bridge, 2007). As a new world emerges, radically affected by climate change and resource depletion, environmental economic geography has the potential to come forth as the most complete set of tools available to elucidate humanity’s interaction with each other and with the world around us.

Works Cited

Bastian, C. T. (2002). Environmental amenities and agricultural land values: a hedonic model using geographic information systems data. Ecological Economics , 337 – 349.

Bridge, G. (2007). Environmental economic geography: A sympathetic critique. Geoforum , Volume 39, Issue 1, Pg. 76 – 81.

Gibbs, D. (2006). Prospects for an Environmental Economic Geography: Linking Ecological Modernization and Regulationist Approaches. Economic Geography , Vol. 82 Issue 2, p193-215.

Hanink, D. M. (1995). Evaluation of Wilderness in a Spatial Context. Growth and Change , v. 26, iss. 3, pp. 425-41.

Hanink, D. M. (2005). Geographic Change with Trade Based on Comparative Advantage. Annals of the Association of American Geographers , Vol. 95 Issue 3, p511-524.

Hayter, R. (2008). Environmental Economic Geography. Geography Compass , 831 – 850.

Heidkamp, C. P. (2007). A theoretical framework for a ‘spatially conscious’ economic analysis of environmental issues. Geoforum , Volume 39, Issue 1, Pgs. 62 – 75.

Kassinis, G. I. (2001). Location, Networks and Firm Environmental Management Practices. Journal of Environmental Planning & Management , Vol. 44 Issue 6, p815-832.

Krugman, P. (1991). Increasing Returns and Economic Geography. Journal of Political Economy , v. 99, iss. 3, pp. 483-99.

Le Heron, R. (2007). Improving Wsheries management in New Zealand: Developing dialogue between Wsheries science and management (FSM) and ecosystem science and management (ESM). Geoforum , Volume 39, Issue 1, Pgs. 48 – 61.

McCann, P. (2004). Location, agglomeration and infrastructure. Papers in Regional Science , Vol. 83 Issue 1, p177-196.

Platt, R. H. (2004). Toward Ecological Cities. Environment , Vol. 46 Issue 5, p10-27.

Stormer, E. (2007). Greening as strategic development in industrial change – Why companies participate in eco-networks. Geoforum , Volume 39, Issue 1, Pgs. 32 – 47.

Weiss, G. (2007). The infuence of the local level on innovations in environmental technology: The case of the German kraft pulp industry. Geoforum , Volume 39, Issue 1, Pgs. 20 – 31.

Filed under: Environmental Economic Geography