supply, urban infrastructure—on an item by item basis. 7
Ozone depletion affects the upper atmosphere (stratosphere), which houses a thin layer
of naturally occurring ozone that absorbs 99 percent of the incoming ultraviolet solar
radiation. Industrially produced chemicals—Chloroflurocarbons (CFCs) diminish the ozone
layer. In 1985, Antarctica’s atmosphere was observed to have been punctured with an "ozone
hole" i.e. 40 percent below average ozone levels, caused mainly by CFCs. The situation did
not subsequently improve. Resultant increases in ultraviolet radiation are likely to have
similar effects as those of carbon gases; but equally significantly, a 1 percent reduction in the
ozone layer could lead to a 10 percent increase in human skin cancers.
It is obvious that the targets for penalization should be emissions of acid, CFCs and
carbon into the atmosphere. Given that their primary source is the North, it is unavoidable
that it has to bear the brunt of the cleanup and maintenance costs of the atmosphere for some
time to come. In particular, a level of awareness, discussion and debate, if not a critical mass
of consensus, already exists in the matter of targeting carbon emission. Appropriate policies
at the global level—or policies coordinated at the national level by various nations—could help
arrest atmospheric degradation and, at the same time, enable the generation of significant
revenues for global use.
IIL Schemata to Illustrate the Constraining Influence
of a Global Factor
In Section II, we argued that environmental degradation can cause factor depletion
both in terms of capital and labour. In this Section we attempt to illustrate the point with the
help of a diagrammatic scheme. Its objective is to demonstrate how constraining influences
such as environmental degradation could diminish the productivity of factors of production
such as labour and capital in future generations.
Also see Cline (1992) for greater details and a benefit-cost approach for estimating
such damage.