Video: Economics Explained: Can an Economy Grow Forever?
0:00 – 7:00
What are the benefits of growth?
- more wealth for more people
- living standards improve
How much does the economy grow each year? - 3% GDP in Western countries
- Economies double every 24 years at current growth rate
What is the GDP? - gross domestic product
- = sum of all transactions made in an economy
- bad metric since porudc
What are the Factors of Production? - land
- maxed out
- labour
- all people are becoming better workers ⇒ education
- just more people (positive feedback loop short term)
- entrepreneurship
- requires high education
- drives innovation
- capital
- most influential factor
- means of production
- all factors rely on each other
7:00 – End
Name the revolutions of the economy
- Industrial revolution
- Gas power revolution (indoor plumbing, combustion engine)
- Computer revolution
Name reasons why growth is slowing down
- Debt
- Education obtainment, limit to ability to lean (nobody can now everything)
- Rise in inequality; inequality hinders innovation
- Climate change
What is the authors stance towards economic growth?
- economic growth is very important
- it’s not given, we have to keep on innovating to keep economic growth
- optimistic
Video: Can Our Economies Grow Forever? By Paul Ekins (TED Talk)
Where does growth at this rate lead to according to Ekins?
- „Overshoot and Collapse” (The Limits to Growth)
- we’re all gonna die
Where are we right now in the model he addresses?
- well on track for Overshoot and Collapse
- GDP and CO2 emissions increase globally
Why has the ecological situation in the UK not become worse?
- decrease by 90% in SO2
- energy consumption didn’t rise as much as GDP, kept about the same
- water pollution and CO2 emissions declined
- public policy (landfill tax) ⇒ outsourcing dirty industries ⇒ shipping trash to 3rd world countries
What is the authors stance towards economic growth?
- doesn’t have to stop
- possible to decrease greenhouse gases with current technology and policies even with rising GDP
- Paris agreement will not directly reduce pollution, politicians will have to implement policies within their own country
decoupling of GDP growth and greenhouse gas emissions ⇒ Ekins thinks it’s possible
Video: Plan B — is there an alternative to economic growth? By Miklós Antal at TEDxDanubia 2014
Name the reasons why economic systems need growth
- unemployment is related to economic growth
- investments require money, if there is no month there is no money for investments ⇒ lower lending rate
- those investments can decrease debt and allow new innovation and businesses
- economic growth is self-amplifying ⇒ downward / upward spiral ⇒ politics act for upward spirals, not for stability because the stability is very fragile
What does Antal say about the proposed solution (decoupling) of Paul Ekins?
- doubts that it’s possible
- consumption is rising rapidly, demand is sky-rocketing
- less efficient economies grow faster
- inefficient structures cannot be replaced fast (physical lock-in)
- inertia in social systems ⇒ would require social change
- rebound effects, e.g.
What are the barriers to future decoupling?
- absolute limits on efficiency
- easily available resources are used up which is the opposite of decoupling
- we’re well beyond environmental limits ⇒ we have to reduce
What is the authors stance towards economic growth?
- we don’t know how to reduce dependence on growth
- we’re not trying to ⇒ people don’t want to reduce consuption
- governments need to fund research
- social change to reduce consumption
- concerned for the future
- collective denial