The New Economics Foundation in the UK has released a major report – Growth Isn’t Possible. The Foundation, whose motto is ‘economics as if people and the planet mattered’, questions whether exponential economic growth is possible in the face of the disjunction between its imperatives and the limits of the planet’s biocapacity. The authors, Andrew Simms and Victoria Johnson, observe that the language of orthodoxy and heresy is a significant one in economic discourse; among other things, I’d add, the political imperative to focus on redistribution rather than the justice of distribution (and thus the inequality inherent in capitalist society) itself constrains questioning. Yet the thesis that growth has its limits is the pure province of neither 70s faddism or heterodox Marxists. John Stuart Mill proposed in 1848:
… the increase in wealth is not boundless: that at the end of what they term the progressive state lies the stationary state.
The NEF report is summarised in this blog post by its co-author and the Foundation’s policy director, Andrew Simms. The report itself is clearly and well written, and marshals an impressive range of evidence and argument about the economics and politics of energy usage. It’s not a quick read, but I’d strongly urge a perusal of, at least, the introductory and concluding chapters. Many won’t want to have the debate it foresees about limits to growth, but it’s one I am sure will not go away.
It’s a lucid report with a very important argument, even if their understanding of economic growth talks straight past contemporary understandings of what growth involves (ie. aggregate increase in exchanges between parties that may or may not involve the disturbance of ‘natural’ systems).
The biofuels and CCS sections are well put together, but nothing new really jumps out at me.
Would be interested to hear from the self-proclaimed economists.
Firstly, why is growth exponential? Growth rates are stable-ish (around 2% annually for us, I think), so doesn’t that make growth itself linear? My brain might be switched off at the moment.
But more importantly, I’m not sure that growth is real. Just as money is essentially a shared delusion that strange coloured pieces of plastic have inherent value, growth is equally a delusion that those pieces of plastic are worth less over time. It’s a useful delusion, as it helps people make decisions, but growth rates don’t automatically require use of more resources (and destruction of more of the environment). The strongest factor in growth rates is total factor productivity, which “accounts for effects in total output not caused by inputs.” TFP is not just labour productivity, or technology advances – a lot of it is driven by the institutions of civil society. I can’t immediately see why TFP will slow over time.
I find the analogies drawn between economic matters (which are not real) and physical phenomena (which are real) unconvincing.
very timely, I just got my new copy of E F Schumacher’s Small is Beautiful: A Study of Economics as if People Mattered
@1 and 2 – yes, I’m not convinced about the “thinginess” of economic growth, either.
Alister, if it’s 2% forever, that’s compounding interest.
Weizsäcker and Lovins wrote an interesting book in 1998, Factor Four, and there was also “natural capitalism” by Hawkins, Lovins and Lovins, which explored in some detail the decoupling of material things from economic growth. A simple example serves – we rely more on fibre optic than copper cable these days. Far more data from a far less resource intensive material – we’re not running out of sand!
Really it all comes down to psychology though. We all seem to have a lot more stuff these days.
Alister,
2% forever is exponential (E*1.02 to the power of n, E being the economy, n being the number of periods measured).
In between the monetary economy and the phsyical world is the physical economy – the stocks and flows of those goods contributing to the economy. You’re right, the monetary economy grows faster than the consumption of most stocks. It can even go online (e.g., Second LifeTM). But the use of stocks still grows – there are very well understood relationships between increased income and the greater consumption of goods. So ongoing increases in consumption and limits to supply apply. Whether this is a limit to economic growth remains a significant point of contention. The New Economics Foundation was set up the challenge the assumption that growth is limitless and to propose alternatives.
Classical economics has a couple of fixes to get around that tricky conservation of mass problem. One is to assume infinite substitutability – when a good runs out another will be found without crippling extra cost, and the other is utility, where we can reduce all value preferences for all material goods to the same level. Both are bunkum.
One of the largest problems in economics is to reconcile the physical economy with the monetary economy. Both are real and they are linked. This is not just an issue for economics – it affects all of us. In that sense, I’m concerned about the physical limits, and don’t have strong views about economic growth on its own. However, because there are so many problems in economics itself, the fact we don’t have a strong theoretical basis for understanding what are very strong empirical relationships between the phsyical and monetary economy is a big worry.
Agreed, Roger. And that’s part of the issue about the abstract nature of money as a mediator of concrete exchanges, and then of exchanges which are purely abstract… (Note that I’m not making an argument against money and for barter or something, just an analytical point). One of the consequences is that mathematised economic science with all its assumptions and postulations often turns a blind eye to the tangible.
Er Mark, one minute you’re criticising Obama for slashing spending and slowing growth, and the next you’re suggesting growth isn’t possible. Which is it?
Recent history shows us that economic growth will be defended at all costs. Look at the size of the stimulus plans in the US, Australia and China, then compare that with the money spent on climate change mitigation.
That growth (both economic and population) cannot continue forever has been obvious for centuries. Unfortunately our economic system cannot function without growth, and our political system cannot make the transition to a steady-state economy. Imagine if a government tried to implement a zero-growth policy — unemployment would soar and the government would be kicked out at the next opportunity. Sadly, we are destined to carry on with business-as-usual until the biosphere cracks under the strain and can no longer support us.
I actually believe in a big Australia. I make no apology for that. I actually think it’s good news that our population is growing.
Contrast that with many countries in Europe where in fact it’s heading in the reverse direction. I think it’s good for us, it’s good for our national security long term, it’s good in terms of what we can sustain as a nation.
– Kevin Rudd, 22/10/2009
Never forget.
@8, carbonsink, as I’ve pointed out many times, the fact that I link to something does not imply an endorsement of it, unless explicitly noted. I find the NEF report interesting for all sorts of reasons, and worth a debate, but I am not equating it with my own view.
I was interested to read (in Growth Isn’t Possible) about the idea of taxing environmental ‘bads’ – getting rid of income tax and I assume changing GST to reflect environmental impact.
I would be interested to hear what the more economically savvy of you make of this.. it struck me a very interesting idea.
Carbonsink; it strikes me that as citizens of the globe, we are better placed than many to accept increases to our population. However, to do so will require a fundamental rethink of our urban planning and resources.
I am not arguing we have unlimited resources, although I would argue they can be much more effectively utilised.
In terms of sustainable population, I take a humanist view in providing choice and opportunity. As I understand it there is a strong link between education of women and decreases in birth rate. If this is true then it would seem a good idea to pursue policies that both empower women in the developing world, whilst also opening up opportunities for immigration to our lucky country.
Suez @ 10: Every person who becomes a citizen of our “lucky country” increases their carbon footprint considerably. Even a middle class citizen of a developing country emits far less carbon than the average Aussie.
If we were good citizens of the world, we’d slash our carbon emissions and restructure our economy so it doesn’t depend on exporting black death to Asia.
35 million Aussies farting out 20 tonnes of CO2 each. I can think of nothing worse.
Happy Australia Day.
Mark,
Thomas Malthus talked about the limits to growth earlier than JS Mill. He published “An Essay on the Principle of Population, as it affects the future improvement of society” in 1798. Malthus posited that economic growth, and specifically the growth of food, in the long term would be outstripped by population growth, and there would therefore be a catastrophic shortage of food and society would collapse. Malthusian-style doomsaying about eternal growth is as old as modern (ie. post-Smith) capitalism itself.
@2 you’re confusing growth and inflation.
I’m stunned that @2 and Mark are unconvinced that economic growth even exists. Stunned.
Matt C, that’s not what I said…
To be precise, I was querying the usefulness or veracity of equating economic growth with the laws of thermodynamics, etc, and responding to dk.au primarily.
Oh, OK. Apologies for misinterpreting. @2 said “I’m not sure that growth is real” and you said “I’m not convinced about the “thinginess” of economic growth, either”, which led me to believe that you also were unsure that growth is ‘real’.
No probs – perhaps I wasn’t clear.
On another tack, is there any academic discipline for which “the language of orthodoxy and heresy” is not present? Perhaps in economics the insider-outsider dynamics are particularly strong, but all disciplines surely have their orthodox positions.
I’m not sure that’s true. In sociology or anthropology or archaelogy, for instance, there are a plurality of theoretical and methodological positions which co-exist reasonably happily most of the time. Sure, it’s present as a tendency in most social scientific or humanistic disciplines, but I think that economics as a science of statecraft, and one which often fails to reflect on its own ideological assumptions, is particularly prone to it.
And @2, if I can speak for Alister, is referring to the physicality of economic growth, a point to which I responded.
Carbonsink, as far as I can see, we agree on quite a bit…our only point of difference is that I am more open on immigration.
I agree radical and immediate action is necessary to rein in our carbon footprint in Australia… thus the comment; “However, to do so will require a fundamental rethink of our urban planning and resources.”
Perhaps I under-cooked this comment- it means rethinking how we generate and use energy, how and where we build, how and why we transport, what we reward and what we penalise. etc etc.
My redirection was- if we are really concerned with population growth, then the only tried and tested humane method of reducing it is education and empowerment of women, and providing affordable accessible contraception.
Matt C,
is there a reason for their having orthodox claims? For the physical sciences, yes, because reproducilbility of experiments, theory and observation mesh very well. Of course it become contestible with the very large and very small. Outside that we have contrarianism (ok, if practised using the ‘scientific method’) and denialism (not). Social sciences – what Mark said. Competing beliefs can co-exist and the task is to come up with better theory and analysis that can address competing claims.
Economics is interesting. Academia is much more diverse than one may expect. However, ideology in public economics is very strong, and with the commodification of education, the education of “employable” economists means that the prevailing norms must be observed. This has always been the way. I have arguments with other scientists because I think economics can be addressed as a science (social science). I think it can be, they do not. It mostly is not, so the empirical evidence favours their argument, the theoretical construct, mine.
I’ve been thinking about this long and hard lately to try and assess the contestability of climate change science and policy.
There are some pretty serious misunderstandings of what growth is in this post.
Economic growth refers to the rate of change of the volume of goods and services produced in a given economy. It is a real, not a nominal concept. Growth in output can be attributed to three factors – increased labour utilisation, capital accumulation and total factor productivity growth (TFP). Capital is not only physical. It also includes social capital (embedded in institutions and culture) and human (education, health). TFP is about producing more with a given amount of inputs (capital and labour) and does not require increased inputs.
Any argument about the end of growth needs to confront the following:
- is the physical capital stock really constrained? One part of the physical capital stock may be constrained – exhaustible natural resources – but subsitutes for many already exist – they are just more expensive. For example, if in the next 50 years we switched entirely from fossil fuel sources of energy to renewable sources of energy, that would entail an economic cost because those inputs are more costly. But that would have a levels effect on output, not a permanent effect on growth. Indeed, as the relative price of fossil fuels and other natural resources increases over time, incentives to innovate and look for alternatives will increase substantially. Moreover, while we may be approaching “peak oil” we are certainly not approaching “peak base metals” any time soon.
- even if the stock of physical capital accumulation is constrained by environmental factors, why does that imply that human and social capital is similarly constrained? At its most basic, human capital is knowledge (this can be embedded in TFP growth as well) and I certainly haven’t seen any good arguments for why there are limits to the growth of knowledge.
- even if one accepted that there were natural constraints on the accumulation of all capital, why would that imply that TFP growth was constrained? What are the natural limits to productivity improvements?
- even the nature of consumption here seems misunderstood. Over time, consumption patterns have shifted considerably away from physical goods to less tangible services. The former (well components of it anyway) may be constrained by any limits to some types of physical capital, but it isn’t clear that consumption of services is constrained in the same way.
- time and time again since the industrial revolution began Malthusians in their various guises have pronounced the end of growth. Yet technology improvements have proved their pessimistic forecasts wrong each and every time. I see nothing in that report to convince me that the same mistakes aren’t being repeated.
Isn’t this a re-hash of what the Club of Rome were arguing back in the 1970s?
Thanks Labor Outsider. Please forgive my naive response- I am genuine and interested in learning from the debate…. I am also a scientist so I wish to speak from the perspective that occurs to me…
In biology we talk about limits to growth… these are the resource limits of a given species in a given environment. Ie- the ammount of food/ oxygen/ water will have a limiting effect on the population. It is about equilibrium- not catastrophic collapse-(that happens when there is a disruption). However, we may not be so fond of the type of equilibrium nature imposes – starvation/ suffocation/ disease… death.
Now as humans we have access to technology- a factor that modifies our environment and changes our limits. So, to over-simplify a fossil fueled society has X limits, whilst a society run on renewables has Y limits.
To talk of these limits is not to evoke a doom and gloom picture that the end of the earth is nigh…. indeed we have ample capacity to transition. However in a very real sense, the current means of organising production and distribution of resources constrains ( Limits) our growth.
Labor outsider, it is fair to say that every activity takes energy, and therefore uses resource. Some of this seems hidden in the language and approach of economics.
Perhaps this is a flaw in economics?
LO,
I think three major questions you ask (in the first three dash points) are really important. But your fourth point is an articulation of the Kuznets curve. That has not been addressed adequately in the debate on growth IMO.
One of my big issues with economics is that conventional economics is based on a world view that has grown out of 19th century science. (I work in an economic research centre, so am an example of having little enough knowledge to be dangerous – I depend on my colleagues for safety). Since then, science has discovered complex systems, requiring an update in the scientific method, where truth is only local, and fundamental uncertainty, state changes, internal and external drivers of change are relevant and switches between periods of relative stability and change are common. Economics is subject to the same phenomena, as we discovered during the GFC.
The nexus between the economy you describe and the biophysical limits that we are confronting has largely been explained away by a discipline that has not admitted to itself that it has to confront the non-linear dynamics at its heart.
Empirically, the evidence of increasing growth of the economy and of resources that have limits is very strong. Those who are risk averse to resource limits wish to limit economic growth. Equally, the empirical evidence of success in continued growth as informed by the past is also very strong. But to provide the goods and services that a much richer world would require (and this includes the fulfilment of the World Summit Sustainable Development Targets, for instance), also needs a great deal of substitution from current patterns of consumption.
At the moment, the debate seems to be confined to a Cornucopian view – that we can have whatever we like and be sustainable too, versus the Petri dish view that says we will hit the glass wall and be screwed.
At present, I think we actally face both of those futures but for different resources. I agree with you thagt energy is substitutable and that carbon is not a given. There are other physicochemical limits that I am very dubious about in terms of substitability. Can we maintain a world with a vastly reduced number of species? Is this supportable? Is apartmentworld (a possibility) sustainable? Will a technology spike occur (a la Kurtzweil or Broderick)?
The other point is a logical fallacy. Because it hasn’t happened doesn’t mean it won’t. This shouldn’t be a recipe for Chicken Little but it does require a hard, cold gaze at the evidence.
The Cornucopians will be “correct” right up to the moment of collapse. Look at fisheries. New technologies, and moving to ever deeper and more remote parts of the ocean, increased yields for centuries, right up until fisheries collapsed. Sometimes technology doesn’t solve the problem, it simply hastens the collapse. Enhanced oil recovery is another example.
Unfortunately Labor Outsider (and his soulmates at the IPA
) will continue to be “correct” until the moment biosphere cracks.
BTW, I’d love to believe in the technology spike, but even if it happens (and humanity develops an infinite source of cheap, clean energy) surely that makes “apartment world” inevitable in a growth economy? We have to grow, and zero cost energy will allow us to grow faster until we hit another limit.
LO, I agree with your points on some levels, but there are two things:
1. You would surely acknowledge that most economic discourse is not based around growth in the all-encompassing and relatively flexible terms you have you have defined (except, perhaps, insofar as some of those things may be seen as corollary or derivative from the economic, dare I say more financially-defined growth)?
2. Your hypothetical about shifting away from a carbon economy is a good example of the importance of timeframe when talking about growth. And would you recognise that growth foci in public policy is typically (rightly or wrongly) focussed around much smaller timeframes than the examples you’re talking about – indeed so small, that the goal becomes not growth, but constant growth, with both the negatives and positives implied?
I apologise is this is muddled or ignorant. I’m not an economist, and I’m asking the questions in good faith.
PatrickG
The “growth” literature in economics is almost entirely about these broader issues and thinking about the factors that explain different long term patterns in growth and changes in living standards. Of course, because that is a specialised field, it doesn’t make its way into the daily newsycle much, although the focus of policymakers on productivity growth/potential output reflects the importance of these longer run factors.
Although over the very long term, the structural factors I have talked about are most important, over shorter time frames policymakers and of course voters are more concerned about business cycle fluctuations. When output growth in the short-term falls below its potential rate of growth firms tend to shed labour, income growth falls and of course we get all the associated social problems with those changes. So, the reason why constant growth becomes a goal of public policy is that when growth falls below its potential (or turns negative) social welfare unambiguously declines.
In economics the study of the business cycle is usually distinct from the study of longer run growth. For example, monetary economics is largely about dampening business cycles and has little to say about long-term growth.
I should also add a qualifier to what I said in my earlier post. In the presence of externalities and other market failures, growth in a market economy could indeed by constrained by the factors others have mentioned unless those externalities are internalised and market failures corrected. Indeed, that is one way I understand the climate change policy debate. We know that the free market outcome is not a sustainable one in the very long term and so to avoid some sort of Malthusian crisis global GHG mitigation is necessary. Of course, climate change mitigation is only one example of this problem.
You should think of my earlier comments as trying to add some nuance to a debate that often takes place in quite simplistic terms. Sustained long-term economic growth need not be so closely tied to natural resource exploitation as some posters seem to think.
Also, economic theory and empirics are a lot more flexible and wide-ranging than posters here seem to think. For example, the idea that economists haven’t thought about non-linearity within economic systems and are not making attempts to operationalise those non-linearities (when relevent) into models or thinking about public policy is just plain wrong.
If, contrary to what many people say, GHG emission reduction is very expensive, then isn’t this an argument for not trying to reduce emissions, but spending money on mitagation instead?
I’d like to really sink my teeth into this topic my duty requires that I divert my attention elsewhere from here on. However I’d like to pose a few points for people to respond to:
1. As has already been noted, to claim that there are ultimate biophysical and/or ecological limits to growth in the physical scale of human economic activity, or to the physical scale of particular economic activities which in turn set limits on the scale of overall economic activity, is not the same thing as to say that there are ultimate biophysical and/or ecological limits to growth in the overall value produced and circulated in the economy. It may be more accurate to speak of the long-run goal of a sustainable society in terms of a “steady state” (Herman Daly) or “stationary state” (John Stuart Mill) economy rather than a “no growth” economy.
2. Andre Gorz once noted that the measures required for a transition of developed economies to an ecologically sustainability society would require and/or result in continued relatively high economic growth, at least in the short to medium term. This is implicitly reflected in the practical policy programs of most environmental NGOs, Green parties and the like in, for example, the current debate over climate change policy where the green and Green side of the debate (including economists such as Nicholas Stern and Ross Garnaut) argues that strong emissions reduction measures can be better for economic and employment growth for the remainder of this century than more modest emissions reductions, or “business as usual” scenarios. Regardless of whether one thinks the greens and the Greens are correct in this assessment, they are clearly not intentionally advocating a transition to a zero growth economy in the term of the next Federal Government.
3. Is there an argument refuting the “limits to growth” position which does not ultimately derive from Marx and Engels’ critique of Malthus? (Remember, too, that accceptance, in some form, of long-run limits to economic growth was common to all the great classical economists, not just Malthus).
4. Here’s trackback to an item which may be relevant to this discussion.
Carbon sink @8: You say:
However, the real problem is that we have a system that deals with a decline in the available work by, as you say, adding to the number of unemployed. Governments know that growing unemployment is political doom hence the addiction to the economic growth Ponzi scheme.
Perhaps we should be putting our minds into the development of systems that share the available work. We can already see some of this happening. It is much easier to work reduced hours, take more holidays or simply work part time or casual than it was 15 years ago. Many companies that would have responded to the a GFC 15 years ago by laying people off responded this time by reducing people’s hours.
Governments should be looking to push these trends further. For starters it might help to conduct a zero growth study that looks at how the damage to individuals, the community and business could be limited in the case of zero or reducing economic growth. Sharing the work should be part of this study as should the potential benefits to quality of life. (More time off, less pollution etc.)
Growth is in a sense working to deny entropy. To generate new, complex things out of simpler substrates and the application of information. I think that (without getting too sci-fi) with biotechnology we can see a real decoupling of material inputs from wealth-creating outputs.
I’m surprised noone has mentioned Adbusters’ “Neoclassical Economics? Kick it over!” issue.
It’s really interesting to see how the defeat of conventional economics phrased as a ‘left-vs-right’ issue, as if the only alternatives to mainstream economic thought are Marxism and/or collectivism, but that’s not exactly the case.
Malthus, Matlthus, Malthus – where art thou?
The thing that Growth Limiters (be they population, resources or economics focused) appear to ignore is the adaptabilty of the human race. Our ability to adapt, improvise and overcome (US Marine Corps Hoo-ah!) has always overcome limits and proved Malthus wrong. Whether it be food stocks or peak oil etc, humans have always worked out ways to get on.
That said, I concur with the poster above who identifies the inverse relationship between the educational level of females and fecundity. If the global population continues to become more educated then it would appear that global populatin growth at some point will reach an equilibrium point. However, it is interesting to note that the US continues to have a birth rate above replacenment rate despite the high level of education of it’s females when compared to other western nations.
As for this crap about Australia being full – we have oodles of habitable land that is currently underdeveloped/untouched. Even our Capital cities are underdeveloped when compared to global equivalents on a population density basis.
Check the population curve: does it keep growing exponentially?!!? Nothing, in nature, can grow exponentially!
“Nothing, in nature, can grow exponentially!”
I’m no mathematologist, but I’m pretty sure you’re wrong there KeiThy. If you meant “…grow exponentially forever“, then sure.
The authors have given us the impossible hamster
Impossible hamster is impossible.
Thanks, Myriad. (I usually use the behaviour of yeast in a batch of beer to make the same point, but the hamster is much more graphic.)
Too right Razor. I am an unrepentant optimist about the creative capacity of humanity to work out how to enjoy a rich and fulfilling future without anywhere near the current level of fossil fuel use.
Keithy
“Nothing, in nature, can grow exponentially!”
Sorry, but that’s just WRONG (from a biological standpoint).
ALL natural systems grow exponentially in the absence of limiting factors.
Limiting factors (by definition) limit this exponential growth, but the potential is always present, and becomes actual if the limiting factors are removed.
I didn’t realise you were a Cornucopian, Paul.
Razor, on adaptability :
“Our ability to adapt, improvise and overcome (US Marine Corps Hoo-ah!) has always overcome limits and proved Malthus wrong.”
Well no, actually.
What such abilities have done, is to postpone Malthus’ predictions rather than “prove Malthus wrong”.
To suggest that we are capable of “adapting” to all challenges to our (racial/societal) survival is clearly nonsense, particularly when one considers the range of threatening possibilities.
That being said, I agree that we are pretty clever monkeys, and are generally pretty quick to move away from destructive or dangerous activities when they threaten our survival.
Unfortunately, it seems to me that much of our “cleverness” and “ingenuity” has been subsumed by the delusion that “the economy rulez”. to the extent that we are :
1. Threatening the global support systems which provide the “ecosystem services” upon which we all rely.
2. Potentially sacrificing the future of human civilisation (if not survival) at the altar of the false god of “economics”
3. Living in a fantasy (propped up by economic and political theory) of a universe of illimitable resources which must be consumed in order to provide the “growth” that the false god requires, rather than learning from the realities of our situation where ALL resources are limited.
So economic/political models based upon continuous growth (and consumption) of resources in a “limited” environment (our globe, the solar system) are doomed to failure when eventually we “hit the wall”, whatever (or whenever) that may be.
I’m pretty pessimistic about our chances of adapting to, or in finding ingenious ways to replace destructive and harmful technologies given the apparent “dumbing down” of public discourse to the current state where fools and liars such as Monckton and Plimer are widely regarded as having worthwhile input into the science AGW.
…….the science of AGW
Roger Jones @ 25
Your criticism seems to boil down to Economics lacking the humility of contemporary experimental sciences. These sciences have a lot to offer – they approach their objects with caution, anticipating the networks of relations in which they are embedded to have unexpected effects on any interventions into them.
But this assumes that the object of Economics should be approached with the same assumptions of naturalism as a physicist would her sub-atomic particles etc. The problem with Economics is that it is entangled with its object in quite different ways. Despite over a century of physics envy, it hasn’t quite been able to constituted an object separate from its own assumptions and practices.
Anyway, would you be satisfied if bankers were aware of long tails and used a curve in their risk models reflecting the likelihood that they hadn’t taken account of some thing – that the scales aren’t stable and a certain calculation or convention (rounding to 1/4 of a dollar in stock quotes; LIBOR seeming a bit off) could come back to haunt them? Coz, as far as I’m aware, they already do…
As far as I’m concerned, and call me old school, the most likely candidate to challenge the neoliberal collapse of politics into economics (the policy discourse that says ‘we’re all homo economicus now’) is a revival of the sense of the inate superiority of public discourse to private consumption. But I’d like to be convinced otherwise.
DINR @ 41:
They’re everywhere David. Julian Simon has been “proved” correct so many times now, I don’t know why the Malthusians bother coming out from their shelters to argue the point anymore
This is an argument no-one can win until human consumption of natural resources stabilises –OR– there’s a Malthusian catastrophe. The Cornucopians will always say “it hasn’t happened yet”, and the Malthusians will always point to the bleeding obvious — that the planet is finite.
Unfortunately “ecological services” can appear to be in perfect health right up to the moment they collapse. Again I point to fisheries as an example. The Northern Cod Fishery collapsed very suddenly and has never recovered. We are possibly seeing warning signs that the Murray-Darling system is about to do similar, but Kev and his Cornucopian advisers are pushing ahead with their insane plan for 35 million Australians.
Have you folk ever wondered why the dozens of Australian economists who blog or regularly comment on blogs don’t bother visting this blog?
Just askin’.
dk.au@25
Not at all. I think economics has a strongly normative, rather than positivist aspect. Values are a product of human choice rather than an external reality addressed by a mathematical model. So it doesn’t just mean the updating of the models to do non-linear somersaults.
Experimentalism works really well in behavioural economics for instance but it’s tricky. So the humility you speak of works really well to try and understand that(and I’m not all that sure a lot of science is that humble
).
Like you, I would like to see intelligent public discourse work as more of a value-setting mechanism. And to see the appropriate tools where possible. Very happy to see cost-benefit analysis being used in many situations e.g., investment in energy saving, agricultural adaptation. Not happy to see it used in balancing global damages (all values monetised) against the costs of mitigation.
Final word – to quote Alan Greenspan:
An understanding of complex systems would suggest that the self-regulation of markets through self interest will end in tears becaue all such systems are inherently unstable. It’s the assumptions that I would like to see investigated with a skeptical eye, that’s all. To Greenspan’s credit he did say – I still do not fully understand why it happened. And obviously, to the extent that I figure out where it happened and why, I will change my views. And if the facts change, I will change.
Correction, dk.au@44
I had my tongue in my cheek a bit, carbonsink. (I doubt if Paul is actually a cornucopian, I just think he had a cheek-full of tongue as well.)
Agree about the collapse of ecological services, btw – the Murray – Darling is clearly already fucked. The thought of 35 million Australians in 2050 would terrify me if I expected to still be alive by then. It certainly terrifies my children, some of whom probably will be. (The oldest was born in 1975.)
Salent @ 46, they probably avoid the joint because some of us are mathematiccaly literate. Quiggins – a mathematician – is an exception, I think.
Um. Some of us don’t spell very well when we’re pissed, though.
Too many c’s, not enough l’s …