Post-Growth, Credit, Interest and Money

As impressively (though unwittingly) shown by Francis Fukuyama, attempts to imagine the future of societies are likely to go wrong. Extrapolation of trends can well be a bad idea. On the other hand, some idea about what the future is to look like is needed when a major transformation of the society is to be attempted. The transformation towards a post-growth society is no exception here. It would be naive to expect an exacting outline of how a post-growth society is supposed to work, but it is important that those advocating it at least try to give answers to some inconvenient questions: what about productivity growth? Can universal basic income, supported by many in the degrowth movement, work? And what about the monetary and financial systems? The latter question has gained some attention recently, and some argue that monetary factors might be a main obstacle for a post-growth society. Their arguments should get proper consideration if we do not want to choose the wrong transition “trajectory”, given path dependencies so common in socio-economic systems. Continue reading

Stanley Jevons’s Prophecy

In his famous treatise The Coal Question: An Inquiry Concerning the Progress of the Nation, and the Probably Exhaustion of Our Coal-Mines, published almost 150 years ago, the British economist William Stanley Jevons described a phenomenon whose importance today might be even higher than back in 1865–the so-called rebound effect, also known under the names of second-order effect, Khazzoom-Brookes effect, backfire or Jevons’s paradox. Jevons argued that the increased efficiency of steam engines shall lead to increased use of them and thus, counter-intuitively, to an increase in coal consumption. His insights have surprising relevance for today’s debates on economic growth and climate change. Continue reading

3 Reasons Why a Post-Growth Society Is Not Within Reach

For reasons explained elsewhere (see, e.g., this post and that one), I am among those dreaming of a post-growth society. Of course, it is not entirely clear what a post-growth society would look like, and even less is known about the road there. Still, many people around the world–for instance those coming to Leipzig in September for the 4th International Degrowth Conference–agree that one of the greatest problems of the current societal-economic model is that it is heavily dependent on economic growth. And that at least the first steps towards it should be done soon, for the longer we wait the more we put our civilisation at danger of collapse of one kind or another. Nevertheless, there are numerous obstacles that hinder the urgently needed transition. In what follows, I would like to present three reasons why a post-growth society is not within reach, which are related to three aspects of human psychology: laziness, narratives and conservative inertia. Continue reading

“The world can, in effect, get along without natural resources”

As almost every societal movement, the sustainability movement has its personalized evils, its specific foes. One of them is Robert M. Solow, the famous creator of the growth model that supposedly is the source of all evils in this world. Moreover, a quote of his can often be encountered (including in the German Wikipedia article about him) that comes from a lecture he gave in 1974, where he said:

The world can, in effect, get along without natural resources, so exhaustion is just an event, not a catastrophe. Continue reading

Progress as Changing Patterns of Dependence

Progress. Hardly any word describes better what is special about the last 200-250 years of human history. Up to then, technological, economic, social progress was scarce, the European Medieval was characterized rather by regress, for instance. But then, then came the Great Transformation, the Industrial Revolution, and changed everything. Today, it is clear to (almost) everyone that the pursuit of progress is what defines humanity, even though it is not the whole definition. Yes, we have difficulties when it comes to agreeing on what progress is. But we mostly identify progress, at least implicitly, with technological progress – all the nice innovations, not necessarily technical in a narrow sense, but also e.g. institutional, that make us less dependent on nature. This is, indeed, what defines social progress in the end – our ability to overcome scarcities and obstacles “created” by nature, be it with regard to natural resources for production, be it our psyche. When it comes to the former, however, it may be argued that we do not really become less dependent – we only change the source of dependence. Continue reading

Historical Dynamics of Growth Critique

Since the beginning of modern economic theory’s history, which set off in the second half of the 18th century, economic growth was one of the most central themes, creating controversies over and over again. The emergence of modern economics, identified oftentimes with the publication of An Inquiry Into the Nature and Causes of the Wealth of Nations by Adam Smith, coincided with the onset of an exceptional process in human history: until the late 18th and early 19th century, economic growth had been a temporary intermezzo at best, not a general pattern of socio-economic development of human societies. Then, around the time when Smith wrote his book, a new pattern gained momentum, economic growth becoming a matter of course. However, the perception of growth and its limits has evolved over time Continue reading

Peak Everything, Backstop Technology and Economic Growth

And interesting, though also frightening characteristic of today’s world is that it seems to be peaking all the time. Peak Oil, Peak Metals, Peak Soil, Peak Uranium, Peak Rare Earths. Peak Everything, to put it bluntly. Some of these slogans may be exaggerated, at least if taken literally. On the other hand, given high and rising demand for oil, coal, uranium, rare earths, metals, agricultural land and other essential resources – demand that is going to be increasing for decades to come, as China, India and especially Africa will become both richer and more populous -, there is a strong case for taking seriously concerns regarding the diminishing resource base, even if there is still much left. Continue reading