Markets and sustainability

Do markets lead us to make sustainable choices? If not, why not? And what w ould we need to do to remedy this? This paper takes a preliminary look at t hese questions. It identifies three categories of reasons why market choice s may not be sustainable, related to valuation of the future, recognition o f the benefits provided by environmental assets, and incorrect incentives. It gives examples of cases in which these problems have been corrected, and considers the scope for a more positive relation between market forces and conservation of the environment. (C) 1999 Elsevier Science B.V. All rights reserved.