IS BUSINESS GROWTH COMPATIBLE WITH THE ENVIRONMENT ?

For the best part of three centuries, there has been a consensus about the goal of economic policy. Since the dawn of the industrial age in the 18th century, the aim has been to achieve as rapid growth as possible.It’s not hard to see why there has been this focus. Growth has raised living standards, increased life expectancy, improved medical care and resulted in better educated, better fed populations. Indeed, it is a mark of how successful rich western countries have been in lifting people out of poverty that developing countries are keen to have what we’ve had. If faster growth means cleaner drinking water, more children in school and fewer mothers dying in childbirth then the world’s poorer nations want more of it. But there’s an obvious problem. If developing countries are to have the same – or even remotely the same – standards of living as developed countries, that means a lot higher use of resources and additional pressure on the plant. It means an increase in energy use and the risk of an irreversible global climate crisis.
Given the existential threat posed by global heating, the concept that growth is good is being seriously challenged by those who say policymakers should be aiming for zero growth or even degrowth economies, ones that are shrinking. Make no mistake, it is a good thing that the accepted wisdom is being questioned. The idea that faster growth is the solution to every problem is no longer tenable.

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