Modeling environmental condition with indices: a case study of sustainability and soil resources

The authors present a framework that illustrates how a resource quality ind ex can be used to examine policy relevant questions regarding environmental condition, the management of a resource as a production output, and sustai nability. The framework demonstrates that heterogeneous endowments of a res ource can change over time in different ways. By evaluating these changes u sing substitution, reversibility and uncertainty criteria, we can suggest f our general guidelines for managing an environmental resource in a single p roduction process. This framework was applied in a case study to three soil types (stable, neutral and susceptible) used in agricultural production in the Midwestern United States. By evaluating the economic and environmental impacts of managing soil quality under different sustainability and profit objectives, we uncovered policy relevant information including: which soil s need to be preserved; when public intervention is needed to attain sustai nability; and what perceptions of sustainability may be worth pursuing at a ll. The accuracy of these insights is highly dependent upon the reliability of the assessment of resource quality. An index was useful in this resourc e assessment because it could adapt to many of the complexities of environm ental condition. We offer three lessons in refining resource indicators so that they may be used in the framework to better achieve optimal resource m anagement and a greater understanding of what sustainability really means. (C) 2000 Elsevier Science B.V. All rights reserved.