Should Scientists Embrace Economic Growth?

Many scientists find their work financed by corporations, governments, and even nonprofits whose orientation by default favors continued economic growth. For corporations growing markets mean more profit. For governments growing economies mean more prosperity for those who elect them and the ability to sidestep the tricky issue of redistributing wealth, an issue that would almost surely be front and center in a no-growth economy. For nonprofits world economic growth is seen as a way to lift the poor from their misery through increasing economic opportunity.

Does any of this pose a problem? "No" might be the answer were it not for several inconvenient trends in the global environment that are the direct result of unbridled economic growth. Global warming is perhaps the most visible, but other trends include energy depletion, soil erosion, water depletion, fisheries collapse, deforestation and rapid species loss. And, of course, all of these are correlated to population growth.

Perhaps the most cogent spokesperson in favor of continued economic growth is Bjorn Lomborg, the self-styled "skeptical environmentalist" and Danish political scientist. In a recent interview on The News Hour with Jim Lehrer Lomborg explained his view that global growth would inevitably provide the increased wealth and new technologies needed to deal with the myriad environmental challenges we face.

This begs two questions: 1) On what is growth based and 2) can technology really address disruptions in complex natural systems? Growth, of course, is based on access to increasing inputs from the very natural systems which are now in decline. Lomborg seems to embrace the economist's view that natural systems can provide whatever the economy needs for its growth. An ecological economist would see it differently noting that all of society is dependent on agriculture, forestry, fisheries, and mines for food, fiber, minerals, and especially energy. If these foundations are being perpetually degraded and undermined, say, by climate change, water shortages and depletion, all the other wealth-creating and technology-creating parts of society will have increasing difficulty functioning.

So, can technology help in this regard? Certainly, technology has the potential to make societies much more frugal in their use of natural resources. It could therefore make available many of the same services we now enjoy while significantly reducing the necessary throughput. (It is, of course, the services we get from goods that we want and not merely the goods themselves.) But in a continuously growing economy we are faced with the Jevons Paradox. Efficiency tends to make things cheaper and therefore more affordable, thus expanding their use. Counterintuitively, efficiency gains in a growing economy lead to increased overall consumption as many more people take advantage of goods and services that were previously too expensive.

The answer to this problem is an economy in which overall throughput declines or at least is held constant. It is hard to see how this could happen without moving to a steady-state or no growth economy since continuous growth, no matter how gradual and efficient, implies a very high and growing rate of throughput in the long run. In addition, it is no longer credible to claim that technology will solve all of our problems without creating new ones. Nor is it plausible that we could become infinitely efficient. The laws of physics dictate that we always lose some efficiency when we transform matter or energy from one state to another.

Those who believe a steady-state economy must be synonymous with a centralized, command economy that is bereft of any improvements are misinformed. Markets have existed in steady-state economies from the dawn of history. Moreover, as former World Bank economist and steady-state advocate Herman Daly has shown, market competition in such an economy would focus on improvement in quality and efficiency. And, in such an economy efficiency gains would actually reduce throughput and thus reduce the burden on the ecosphere.(1)(2)

So those scientists who understand our ecological predicament and feel we should address it face a predicament of their own. How can they continue their work without feeding further destructive economic growth? There is no easy answer to this though focusing on quality and efficiency rather than quantity may provide a clue.

One thing is almost certain though. Given the continuing toll that unlimited growth would exact on the already overtaxed natural systems that sustain us, it seems very unlikely that Lomborg's wealthy future could become a reality. And that means that all of us, including scientists, will have to give serious thought to the notion that economic growth and true sustainable long-term wealth may now be antithetical.

Notes:

(1) Herman E. Daly, "A Catechism of Growth Fallacies," Chap. 5 in Steady-State Economics: Second Edition with New Essays (Washington: Island Press, 1991).

(2) _____________, "Economics in a Full World," Scientific American (September 2005) : 100-107.