051 Operational research and public policy

There are other conflicts. There has been widespread cancern that the natural resources to support present levels of industrial activity will run out sooner or later; and fear that it might be sooner. As a crude summary of the vast amount of research and speculation on this point the debate falls between two schools. The ’doom’ school fear that man will run out of renewable resources, with disastraus effects. Their views tend to be reinforced by the ’conservatlsm’ and ’back to nature’ schools. Economic growth will have to be reversed, they say, with consequences for every kind of policy. The ‘cornucopians‘, by contrast believe that man’s ingenulty will find substitutes in good time for anything which becomes scarce. With enlightened economic policies, they say, growth can continue, since economic forces and technological ‘fixes’ will carry us through. A more modest position, between these extremes, is that provided there is enough energy, and the institutions of society can adapt to making investment decisions which are sufficiently long-sighted, and world shifts in economic power do not lead to major wars, then continued economic growth-is feasible and the world system need not collapse.

Energy problems look very different as seen by economists, by politicians, by technologists, according to concepts familiar to their own disciplines and to the different time horizons to which they are accustomed in their thinking. As a matter of public policy energy is a large central affair but this hardly reflects the fact that actions and decisions throughout society have substantial energy consequences. Thus energy is a relevant unit of account by which to incorporate resource questions into our model.

Energy must have a central place in this discussion because it is the ultimate resource. That is, all transformations of materials require energy, and with sufficient of it acceptable substitutes can be found for anything which becomes scarce. Goeller and Weinberg (1975) conclude that mineral resources are adequate provided man finds an inexhaustible non-polluting source of energy; the main problem is how to make the transition from the present state of relative plenty of oil, coal and other resource materials to what they call ‘The Age of Substituability’ using renewable resources only. The problems they see are social and political; new social institutions would be needed to overcome the fact that the market place optimises short-term advantages, thus inhibiting the transition. Appropriate policy changes are, therefore, contingent upon institutional changes.

We have now redefined the cluster of problems in terms of a balance between an input of resources and an output in terms of the satisfaction of human needs and desires. This balance is influenced by policy interactions and institutional change. For the purpose of reaching broad conclusions energy will serve as a single numeraire of input especially since a good deal of research on energy accounting (e.g. Wright (1975) and Slesser (1975)) could be used. We are not yet in a position to simplify the satisfaction side of the model, and might never be. Let us assume for the moment, however, that we can.

There is implicit in discussion of economic growth the idea that greater human satisfaction will be, and can only be, obtained via greater production of material goods and hence by the greater consumption of resources, but it may not be so. Maslow (1954) claims that there is a partially ordered hierarchy ranging from the basic physiological needs such a food; shelter and other needs for safety; then needs for love and esteem. The upper part of the range is the drive for individual self-actualisation which he expresses as ‚what a man can be he must be‘. Maslow has suggested that the attempt to obtain satisfactions further up this hierarchy is made as soon as, but not until, the more basic requirements have been satisfied. In that extravagant consumption of material goods is sometimes a surrogate for the satisfactions to be derived from individual self-actualisation, it could be that the optimum relationship between the degree of satisfaction achieved and the consumption of material resources, is as in the following diagram. Hopefully It will be found to be so.