Market Regulation

Summary

Twenty years after the universal agreement on the reduction of global green house gas emissions, the world temperature rise slowed to a halt. Nations were able to cooperate together and form sustainable and successful commodity markets that had harsh punishments for excessive carbon emissions. To answer the volatile commodity market in the beginning of the 2010s, world leaders had decided to establish universal legislation covering all aspects of free markets. And they made big accomplishments through a series of actions such as standardization of the recycling process, ban of rain forest cutting and overfishing, taxes on carbon consumption, new investments on water projects in countries suffering drought and accelerating innovation of new crops with high yield. As a result, the consumption of natural resource (e.g. oil, water, food, forest etc) became sustainable. Through these market regulations the rise in temperature was stabilized to acceptable levels. Weather phenomenon still occurred over the next few decades but the world was on the path to sustainable temperature reduction. Wars continued but resources were not a factor as the free market allowed for appropriate flow and distribution.

Description

2010

The world faced serious threat from global warming, which also had negative effects on the ecosystems and biodiversity. Natural resources were being affected from both overuse and diminishment from the poor environment. Growth in population and consumption per head through recent years put severe demands on the supply of commodities such as oil and food. International climate control agreements gave momentum to nations to spread agreements to all aspects of sustainability. People and countries were already aware of the situation and ready to resolve the problems through global cooperation instead of former individual and less effective efforts. To avoid the collapse of the environment, world leading countries first reached an agreement on how to reduce green house gas effectively together and started to implement these agreements worldwide. Meanwhile, they decided to apply global regulations to preserve resources and adjust the market. Regulations at first were limited and met with resistance as people had to readjust to rising prices and alter their consumption habits. Resources such as Atlantic Tuna received quotas and policing. However, quotas were not set low enough and the decline in tuna stock continues. New technologies with carbon-benefit features begin to boom. Such as carbon-neutral cars and factory waste reduction. Goods begin to be designed with future flexibility in mind – often modular and always easy to re-use or recycle. Information and communication technologies (ICT) continue to develop rapidly.

2020

In this decade, the world climate problem began to come under control. In the last decade, the emission of green house gas only increased about 15%, and the average global temperature increased about 0.1 C. Both numbers are good indicators of slowing down the global warming according to the Intergovernmental Panel on Climate Change projections in their fourth assessment report in 2007(AR4). Global cooperation on sustainable development achieves initial success. Countries share technologies to preserve natural resources and fight poverty. The economy is maintaining impressive rates of growth worldwide, and is more interdependent than ever before. Due to the application of the carbon consumption tax, businesses had been forced to profit through a more carbon-efficient way. Instead of simply using less energy, the innovators asked: what do my customers really want, and how can I deliver this in the most cost-effective, low-carbon way? Companies found ways of selling performance. Moreover, because of the fast development of ICT, travel has been substituted with personal communication. Business’ low-carbon and high energy-efficiency approach resulted in a slow consumption rate of traditional fossil fuel. And alternative energy, such as solar, wind and geothermal, began to be massively applied because of the maturity of the technology. China and India had successfully developed new crops able to produce a sufficient yield without carbon-intensive inputs such as fertilizers or weed-killers and they started to share the innovation with less developed countries. As people realized the impact of their consumption levels more regulation was emplaced and recovery of natural resources was achieved. For example, the case study of Atlantic Tuna. The decline of tuna was delayed. As people realized previous efforts were insufficient, governments enacted swift bans in order to spur recovery. Fisheries suffered for several years as they waited for the tuna stock to recover. Though recovery still occurred the depth of the decline and the slow recovery could had been avoided if fundamental consumption habits changed.

2030

The world temperature growth became close to flat. People shared an attitude of acting together in order to prevent a further drive towards ‘runaway’ climate change. And the world economy kept stable growth. New leadership in the global sustainable development emerged and our environment and the natural resource became more and more sustainable.
Due to business transformation and alternative energies application, fossil fuel consumptions are not as high as EIA expected in 2008. For example, oil consumption increases only 20%. Since the climate change effect is mitigated and world’s efforts of building water projects and pollution management to preserve available freshwater, the total freshwater supply increases. Rainforest is able to be saved from massive felling. Production and consumption of key wood products and wood energy are diverted to trees which are planted specifically for commercial purpose. Global food price is less volatile and tend to stabilize. Due to China and India’s new invention on new corps, worldwide hungry and poverty are reduced by 70%. It’s very likely that in the near future, farmers will produce enough grain for both food and biofuel.
China and India had been through rapid growth in population and economy, which inevitably put them under pressure of increasing demand of resource, such as energy, water, land and food. Thus they had been force to explore all the ways to build the capacity that could sustain their people and mitigate the harm to the environment. Now they became leaders of the developing world in the pursuit of sustainable earth. And they continue to push for global cooperation in the future. Local and regional regulations are aligned with national and international regulations due to the strong top-down initiatives.
Today’s technologies had a focus on meeting people’s underlying functional need with as productive a use of energy and resources as possible. Electric engines and pumps were extraordinarily efficient and closer to ‘theoretical maximums’ than ever before. Energy came from a variety of sources, but the vast majority of generation provided no overall emission of carbon into the atmosphere – it is simply too expensive to do so. The cost of energy had inevitably been passed on to consumers and businesses.

Common characteristics

Lifestyle
Although most people in the world realized what is going on and would like to change the situation they live in, mostly in this scenario, people relied on government/regulation or technology to make the decisions and they just adjusted rather than actively fundamentally changed their lifestyle. For example, people had to decrease their resource consumption (e.g. tuna) somewhat simply because the price was too high or government restriction. Or people’s travels/transportations were reduced because of the ICT development. Moreover, new alternative energy applications let people live in a more energy-efficient and low-carbon way. This is not enough. Resources still become depleted and alternatives are sought. But the rates of consumtpion do not change. The consumption habits and production methods have not fundamentally changed. Continuous intensive education about sustainable development is still necessary to change people’s mindset and achieve ultimate sustainability in the long term.

Business
Business was trying everything to profit in a low-carbon way because carbon is one of the most important and expensive commodities in the world. Companies have rewritten their business models to meet underlying needs, often by selling services instead of products.

Cooperation
In order to fight against the global crisis of sustainability, the world unity was unprecedented. Developed countries would like to share technologies and experiences. New leaders from the developing countries emerged and had big influence in the sustainable development. The world economy is also more interdependent than ever before.

Environment
The climate was getting better. Global temperature growth slowed down and natural resource consumption was able to stay sustainable due to the universal legislation. And various pollutions were under control because of government and business efforts, as well as with new technologies’ help.

Key Uncertainties

The key uncertainty is the level of consumption. Market regulations focus purely on consumption and market oriented activities. These do not address fundamental paradigms regarding the production process or total life cycle of a product.

Timeline