Evidence of significant relationships between Economic Growth & Job Creation, Poverty

Reduction and Resource Constraints & Climate Change during 1990-2014 in Thailand

M.Sc SDMP Thesis Defense

Nina Schneider, B.ScJune 15, 2016

Supervisor: Dr. Ivo PonocnySecond Assessor: Dr. Sabine Sedlacek

The Empirical Possibility of

Table of Contents

June 15, 2016 Table of Contents2

Rationale

RQ & Literature

Method.

Empirical Results

Discussion

Conclusion

The End

The RationaleHistorical Foundations, Green Growth in Thailand

Historical Foundations

June 15, 2016 The Rationale4

United Nations

1972-1995: Protection of Biodiversity

2000-2012: Millennium Development Goals

2015-Present: Sustainable Development Goals

Later adopted by OCED (2011) & World Bank

(2013)

Green Growth is “a strategy of sustaining

economic growth and job creation necessary to

reduce poverty in the face of worsening

resource constraints and climate crises.”

(MCED-5, 2005a; UN ESCAP, 2012)

Green Growth in Thailand

June 15, 2016 The Rationale5

Role of UNESCAP: Regional Commission, ESC

Asia-Pacific characterized by rising natural resource costs

and persistent regional poverty, and decelerating GDP

- Low-Carbon GG Road Map (UN ESCAP, 2012b

- Visible GG k knowledge transfers (GGKP, 2013)

Philosophy of “Sufficiency Economy”:

NESDP (1961-1974): economic growth via import

expansion = poverty, deforestation, econ. growth, crime

1974: King Bhumibol Adjuljadej stressed empathy

- 1994 Strategy: Resilient economic base, sufficiency

- Elements of Green Growth

RQ & LiteratureResearch Question & Objectives, Theoretical Framework

Research Question & Objectives

June 15, 2016 RQ & Literature7

Research Question

Is there evidence of significant relationships between: Economic Growth & Job

Creation, Poverty Reduction, and Resource Constraints &

Climate Change during 1990-2014 in Thailand?

i.e. Are Green Growth’s impacts empirically possible, in Thailand’s recent history?

Primary Objective

Presence of lead-lag relationship between Green Growth’s concepts, and if so,

between which disaggregated variables.

Secondary Objective

Likelihood of causality via lead-lagged relationships and structural equation modeling,

underscored with empirical results and strong historical

context for each year.

Theoretical Framework

June 15, 2016 RQ & Literature8

Total 16 relationships between concepts

Key Literature

- ↑ Economic Growth ↓ Poverty: Kutznets, 1955; Duran, 2015

- ↑Resource Constraints ↓ Poverty: Rees, 1992; Cushion et al, 2010 – esp. rural regions (USAID, 2006)

- ↑ Resource Constraints ↑ Economic Growth: OCED, 2008; Gelb, 2010 – Resource Curse: Auty, 2003

- ↑ Economic Growth ↑ Climate Change: Carbon Dioxide - World Bank, 2007, Lim et al, 2014

MethodologyResearch Design, Methodology

Research Design

June 15, 2016 Methodology10

Research Approach

• Multivariate statistical analysis of secondary data

Historical Case Study

• Good for historical, secondary data• Minimal data collection errors• Inclusion of historical context qualifies it as an

explanatory case study

Sources of Data• World Bank & Thai Meteorological Dept: objective,

consistent, reliable, statistically powerful, saves resources

Measurement of Green Growth

• Green Growth = f (econ growth, job creation, poverty, resource constraints, climate change). Disaggregated into 20 variables.

Methodology

June 15, 2016 Methodology11

Multiple Imputation- 500 cases (1990-2014) for 20 variables = 51 missing values (10.2%)- Missing at Random Clause: systematic missingness (Rubin, 1996)- 5 imputations = Standard error 0.01 (Hershberger & Fischer, 2003)

Cross-Correlation- Exploratory endeavor, 5% significance will not cause Type 1 error inflation - Literature re: time lags are vague, and general. E.g. no reference for appropriate time lag. Therefore 8 years selected (4 year electoral cycles)

Linear Regression or Structural Eq. Modeling- LR = lead-lagged relationship- SEM = path analysis, multiple regression (indirect vs. direct effects).- Include historical context to explain

Empirical ResultsResults (Cross-Correlation, SEM, Noise Residuals),

Historical Context

Results

June 15, 2016 Empirical Results13

Sig. Relationship: GDP Per Capita Unemployment, Adj. Net National Income.

However –

- Adj. Net National Income ≠ CO2 Emissions & Natural Resource Depletion

- Adj. Net National Income ≠ Unemployment- Resource Constraints ≠ GDP Per Capita and Adj.

Net National Income- GDP Per Capita does ≠ CO2 Emissions

SEM on Noise Residuals confirm.

Implication: 1) economic growth assists poverty and unemployment, and 2) economic growth does not worsen resource constraints and climate change.

At this stage of analysis, there is a strong possibility that in Thailand, between the years of 1990-2014, policies reflecting Green Growth ideology is active and present.

Historical Context

June 15, 2016 Empirical Results14

DiscussionContribution to Sustainable Development, Applicability to ASEAN Countries, Implications for Relevant Stakeholders

Contribution to Sustainable Development

June 15, 2016 Discussion16

1. Relative decoupling has been occurring between 1990-2014.

2. Spur academics to confirm finding by tracking longitudinal environmental impact of GG policies in Thailand, e.g. environmental accounting.

3. Develop metrics to measure all of Thailand’s solid/atmospheric waste from natural resource, at the source.

Limitations:

- Lack of inclusion of ALL variables corresponding to GG’s concepts (2-6 variables/concept)

- Multiple imputation’s natural statistical limitation

- SEM is an exploratory procedure, selection of each variable based on strongest, sig. cross-correlations with each other. Based on 29th complete round of SEM analysis.

Applicability to ASEAN Countries

June 15, 2016 Discussion17

1990 2000 2010 2011 2012 2013 20140.500

0.550

0.600

0.650

0.700

0.750

0.800

Human Development Indices (1990-2014) for Thailand, Indonesia, Malaysia, and Phil-ippines

Correlations Thailand Indonesia Malaysia PhilippinesThailand Pearson Correlation 1 .998** .995** .990**

Sig. (2-tailed) .000 .000 .000N 7 7 7 7

HDI Correlations Between Thailand, Indonesia, Malaysia, and Philippines

Implications for Relevant Stakeholders

June 15, 2016 Discussion18

Green Growth

Thailand's Government- Progressive

environmental standards

- Funding GG STEM

United Nations- Capacity-building: development of GG

policy indicators

Corporations- Sustainable production

- Supply chain management

ConclusionThe Future

The Future

June 15, 2016 Conclusion20

Green Growth is not a replacement for Sustainable Development.

Rather, it is a temporary solution to appease the demands of our artificial economic system, until we are all ready for a paradigm shift – one that calls for a balance between

human population and the Earth.

United Nations asked for developed countries to take the lead; therefore, by analyzing Thailand, one of the largest economies in Asia-Pacific, this investigation yielded hopeful

results that there are already signs of Green Growth.

The EndKey References, Photography References,

Acknowledgements

Key References

June 15, 2016 The End22

ADB. (2012). Policies and Practices for Low-Carbon Green Growth In Asia: Highlights. Bangkok: Asian Development Bank Institute. Retrieved from http://ipcc-wg2.gov/njlite_download2.php?id=9689.Beerepoot et al. (2013). Incentives for Renewable Energy in Southeast Asia: Case Study of Thailand. Winnipeg: International Institute for Sustainable Development, and Trade Knowledge Network. Retrieved from http://www.iisd.org/pdf/2013/investment_incentives_thailand.pdfBruckner, M. (2009). Integrating Climate Change into National Sustainable Development Strategies - the Role of Indicators. Institutionalizing Sustainable Development Indicators for Measuring Progress of National Strategies (p. 21). Barbados: United Nations. Retrieved from https://sustainabledevelopment.un.org/content/documents/3184DSD_session_3.pdfBuch-Hansen et al. (2006). Rethinking natural resource management in Thailand. Roskilde: Roskilde University. Retrieved from http://jpe.library.arizona.edu/volume_13/hansen.pdfChen, J. H., & Huang, Y. F. (2013). The Study of the Relationship between Carbon Dioxide (CO2) Emission and Economic Growth. Journal of International and Global Economic Studies, 6(2), 45-61. Retrieved from http://www2.southeastern.edu/orgs/econjournal/index_files/JIGES%20DEC%202013%20CHEN%20HUANG%20%203-28-2014.pdfDuronkaveroj, P. (2015, March 9). STI National Plan towards Green Growth of Thailand. Retrieved from Ministry of Science, Technology and Innovation: http://www.sti.or.th/uploads/news_pdf/42_TH.pdfGGKP. (2015). Green Growth Knowledge Partners. Retrieved from Green Growth Knowledge Platform: http://www.greengrowthknowledge.org/partnersHallegatte et al. (2012). From Growth to Green Growth - A Framework, Working Paper 17841. Retrieved from NBER Working Paper Series : http://www.nber.org/papers/w17841.pdfIslam, R. (2004). The Nexus of Economic Growth, Employment and Poverty Reduction: An Empirical Analysis. Geneva: Recovery and Reconstruction Department in International Labour Office. Retrieved from http://ilo.int/wcmsp5/groups/public/---ed_emp/documents/publication/wcms_120690.pdfMCED-5. (2005a). Achieving Environmentally Sustainable Economic Growth in Asia and the Pacific. Ministerial Conference on Environment and Development in Asia and the Pacific, 2005 (pp. 1-29). Seoul: United Nations Economic and Social Council. Retrieved from United Nations Economic and Social Commission for Asia and the Pacific: http://www.unescap.org/sites/default/files/Theme%20Paper_Eng.pdfMendelsohn, R. (2009). Climate Change and Economic Growth, Working Paper No. 60. Washington D.C.: Commission on Growth and Development of The World Bank. Retrieved from https://environment.yale.edu/files/biblio/YaleFES-00000397.pdfNESDB. (2012). The Eleventh National Economic and Social Development Plan (2012-2016). Bangkok: National Economic and Social Development Board. Retrieved from http://portal.mrcmekong.org/assets/documents/Thai-Law/11th-National-Economic-and-Social-Development-Plan-2012-2016.pdfTMD. (2015a). Climate. Retrieved from Thai Meteorological Department: http://www.tmd.go.th/en/UN DESA. (2007). Indicators of Sustainable Development (3rd ed.). Department of Economic and Social Affairs. New York: United Nations. Retrieved from http://www.un.org/esa/sustdev/natlinfo/indicators/guidelines.pdfUN ESCAP. (2012b). Low Carbon Green Growth Roadmap for Asia and the Pacific: Turning resource constraints and the climate crisis into economic growth opportunities. Bangkok: UN ESCAP and KOICA. Retrieved from http://www.unescap.org/sites/default/files/Full-report.pdf

Photography References

June 15, 2016 The End23

In order of appearance:http://www.epacha.org/siteimages/un_logo_green%20YEAR%20OF%20FORESTS%20UNITED%20NATIONS%20FAO%202011.pnghttp://www.greengrowthknowledge.org/sites/default/files/uploads/GG-Logo-HD.jpghttp://nnimgt-a.akamaihd.net/transform/v1/crop/frm/silverstone-feed-data/960e3284-4172-4b2c-bb6b-0990810643f6.jpg/r0_0_729_410_w1200_h678_fmax.jpghttp://arifiqball.com/blog/wp-content/uploads/2010/05/Arif_Iqball_051510_L1001034_1.jpg http://www.wildwatchthailand.com/pictures/tours/tour_13_1.jpg http://www.un.org/News/dh/photos/large/2015/May/05-28-2015UNESCAP.jpg https://www.globalpeace.org/sites/default/files/UNESCAP.jpghttp://blogs.reuters.com/russell-boyce/files/2010/12/RTXVEVK.jpg http://www.zicasso.com/sites/default/files/styles/original_scaled_down/public/photos/tour/thailand_view_of_maya_bay_phi_phi_island_boats.jpg http://www.climatefinance-developmenteffectiveness.org/sites/default/files/Thailand%20RID.jpg http://www.destination360.com/asia/thailand/images/s/ayutthaya.jpghttp://static.asiawebdirect.com/m/bangkok/portals/bangkok-com/shared/teasersL/SHOPPING/siam-paragon-y/teaserMultiLarge/image/siam-paragon-shopping-mall.jpghttp://static1.squarespace.com/static/565c786ee4b05079e4c2167a/t/57077288e32140a42a4670d5/1460105871882/? format=750whttp://3.bp.blogspot.com/-XEzfStuXb20/UL8jy3k9trI/AAAAAAAAGZk/uJkPpYtevRM/s1600/Self_Sufficiency.JPG http://www.bangkokpost.com/media/content/20150714/1092688.jpghttp://3.bp.blogspot.com/-yOIxiqGYGo0/UY5Z6iIgOvI/AAAAAAAABrc/0_ewNTRJsUE/s1600/shutterstock_green-growth_71322319.jpg https://media-cdn.tripadvisor.com/media/photo-s/06/88/8a/69/thailand-eco-tour-private.jpg http://www.climatetechwiki.org/sites/climatetechwiki.org/files/images/teaser/low-carbon_water_transport_teaser_image.jpg http://www.climatechangenews.com/files/2012/09/unfccc-plenary-at-the-unescap-building-in-bangkok-2011-source-flickr-unfccc-400px.jpghttp://s1.it.atcdn.net/wp-content/uploads/2014/03/shutterstock_148556624-1.jpg http://www.thailandsustainabledevelopment.com/wp-content/uploads/2015/10/PART3_Private_SOCIAL-ENTERPRISE.jpghttp://tourismworldbd.com/wp-content/uploads/2015/12/Elephant-Hills-Rainforest-Camp-Khao-Sok-National-Park-Thailand.jpg http://www.epicproject.net/wp-content/uploads/Smiling%20boys%20in%20mangrove,%20nursery,%20Thailand.jpghttp://becomingthebboss.com/wp-content/uploads/2014/07/thai-monk-tiger-temple.jpg https://upload.wikimedia.org/wikipedia/commons/e/e6/Macaque_-_Monkey_Cave_Temple_-_Thailand_(3930134954). jpg

Acknowledgements

June 15, 2016 The End24

SiNing

Dr. Ivo Ponony

Dr. Sabine Sedlacek

Bradley Malave

Veronika

Family

Irene Helena

Hani

Jordan & Amy

Sebastian

Calder

Optional SlidesSignificance of Testing Constructs, Validity Threats

Significance of Testing Constructs

June 15, 2016 Optional Slides26

Green Growth

• SDGs 8.4: decoupling of econ growth from env. degradation (UN, 2015a) • Improve understanding of variables’ interrelationships • Assist regionally-similar nations in Asia-Pacific

Time Period

• Maximize statistical power, degrees of freedom• Limitations of quality and consistent data (2015 not published)• Coincide with Thailand’s agreement of Agenda 21 at 1992 Earth Summit

Location

• Green Growth ideals in 1974 & 1994 Philosophy of Sufficiency Economy• Presence of UNESCAP – data transparency, accountability• 1990: HDI 0.572, Lower-Middle Income World Bank Class = Contradictory.

Validity Threats

June 15, 2016 Optional Slides27

Construct Validity: Content- UN literature defends representativeness of variables (UN DESA, 2007; Bruckner, 2009; WB, 2015b)

Internal Validity- Confounders controlled for: macro political environment (Setboonsarng, 2012), infrastructure (Gurria, 2006)

External Validity- High generalizability to Thailand, statements may be applied to regionally-similar countries

Statistical Conclusion Validity- Minimize bias of multicollinearity, therefore variables located within each under umbrella concept will not be correlated with each other. Applicable for linear regressions.

Reliability- MI may cause problems for test-retest reliability