Sustainable Prosperity's Submission to the Ontario Standing Committee on Social Policy

Our Sustainable Communities program focuses on analyzing and developing a broad array of market-based instruments to help municipalities address environmental concerns while boosting their economies and improving their fiscal capacity.

Because prices are a strong influence on decisions, in order to achieve their policy goals governments will need to work to align prices with those goals. Where prices are pulling in the direction of policy goals, it will be much easier to achieve those goals. Governments in

Ontario's Environmental Markets: Creating Price Signals to Protect Our Natural Environment

The aim of this report is to explore how environmental markets can be employed as a way to maintain and improve environmental quality and limit pollution as Southern Ontario’s population and economy grow. By creating an explicit value where none currently exists, they can help incentivize Southern Ontario’s businesses, farmers and other landowners, and citizens to protect Ontario’s air, water, and biodiversity.


About the Project

The goal of this project is to shed light on the relationship between economic activity and the environment by exploring the linkages between changes in our natural capital and our measures of productivity generally, and through the construction of an environmentally adjusted measure of productivity specifically.

While it is now commonly accepted that economic activity and the state of our environment are linked, many economic measures still fail to incorporate the environment – both the things we draw from it and the pollution we release into it. By developing and calculating measures of productivity that include natural capital, Canada may be able to better understand these linkages. This, in turn, may lead to the identification of strategies that can help Canada become more efficient and innovative in the use and protection of natural capital, and thus more productive and more prosperous.

Using the forestry sector as a case study, this project aims to construct an environmentally adjusted measure of multifactor productivity. In doing so, we aim to add another layer of understanding to the environmental and economic performance of this sector. The proposed measure will have relevance to the Canadian economy as a whole.