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Assignment 1

Sofa Muzzio Gorrini


To answer the question that if Chile has laws that are designed to insure weak
sustainability of copper mining we first need to understand what does sustainable
development means. Nowadays, many people use this concept but not all of them in a
correct way. We will understand by sustainable development as the one that provides the
needs of the present generation without compromising the ability of future generations to
meet their own needs. But, two central paradigms of sustainable development have
emerged since; these are weak and strong sustainability. I will focus on the first one,
which assumes that: intergenerational equity is reached by maintaining a constant level of
total capital, where capital is understood as: nature's capital, human capital, human-created
capital, social capital, and cultural capital. As a consequence, natural capital can be
consumed as long as parts of earnings are reinvested.
Since 20th century, copper exporting has been the main source of income for the
Chilean economy. So, as our economy depends on the extraction of this non natural
resource, it would be logical that our country worry that this will not be exhausted in the
future, because that will probably means an economic crisis and a worse quality of life for
the future generations. In order to avoid the above, the Chilean government has
implemented a series of laws and regulations for mining operators that regulate their
behavior, looking for good practices with the environment that insure weak sustainability of
copper mining.
There are 2 laws that relation to what we are talking about. In one hand there is the
Ley N 19.300, which is the basic law of the environment, and talks about sustainable
development in a general way. More specifically, Chile has Ley N 20.026, which
establishes a specific tax on mining, referring to the copper, we will find that the tax has the
name of royalty. The income collected by this tax is supposed to be destined to one of the
capitals that are different from the natural (for example: it can be invested in education,
which is human capital) in order to maintain a constant level of total capital; so, as the level
of natural capital decreases, theres another that is supposed to increase in the same amount.
And thats the point; its supposed to increase, because theres nothing that will make sure
that the investment that the government will make in another type of capital will generate
the necessary amount to reach our constant level. Finally, the answer to our question cant
be answered by a yes or no, Chile has laws that are designed with a sustainable
development target, but these dont insure that Chile will reach it, it will depend in the
government actions and the results of these.

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