Institutional Explanation Of Low Cost Economic Development ------A New Sustainable Development Theory And Their Way

Industrialization is not only the main period of economic development, but also the theme of the developing country to seek economic development. During the period of the world industrialization, all countries developed their economy by using natural resources inventively, which broke the ecological environment and formed high-cost economic development. Since the eighties of the 20th century, the global ecological crisis made people realize that social economic development must coordinate with natural ecological environment, and that environment changes have effect on the social economy. Based on the recognition's above, some economist and ecologist put forward "the sustainable development pattern". But up to now, sustainable development still remains on the stage of theoretical explore, academic study, idea propaganda, plan making and normal appeal. However, theYe is no great progress in practice.The obvious contrast between theory and reality shows that, in order to realize sustainable development, we should think about the theory of sustainable development and economic development, including the practice of the sustainable development. And the central point at issue, we should not only seek for searching for a new economic development pattern and economic development theory, but also search for the way of practice. Theeconomic development theory comes from the theory of economic growth theory in the western economics. Since Adam ?Smith, the western economist has probed for the source, motive force and conditions of economic growth. And those are their main research. The purpose was to search for the way of economic growth and development. But these theories neglected the relationship between man and nature in the economic development. They stressed the speed and quantity, but neglected the quality and benefits, especially the contrast of cost and profit in the economy development.The author put forward an idea on the thinking of the theory and practice of the economic development, that is "the cost of economic development is the basic problem of the sustainable development" and "the minimum cost of economic development is the basic theory of sustainable development." With the cost of economic development, this thesis gives a new explanation of the sustainable development. And also with the method of institutional analysis, it analyzes the practicing way of low cost economic development. This thesis deals with three questions. The first one is the new explanation of the sustainable development theory and model building of low cost economic development; the second one is the search of the practicing way to realize low cost economic development; the third one is the positive analysis hi China, which provides an essential for the policy of low cost economic development in our country.In the process of economic development, human economic system and ecological system inevitably affect each other. Man's irrational action disturbs ecological system, so the cost of economic development is unavoidable. But institution affects people's choice and provides the. behavior rules of main's choice .And also it restricts people's irrational action. We can reduce the cost of economic development through some certain institutional arrangements. In 21th century, we should have the target, which is to raise the quantity of the economic development as well to reduce the cost, to build a high-quality but low-cost national economic system. We can realize the low cost of economic development throughstrengthening institutional supply.