Managing without Growth
Dr. Peter A. Victor
York University
Canada
Thursday June 10, 2010
Outline
1.
2.
3.
4.
5.
The economy: a sub-system of the biosphere
Transgressing planetary boundaries
Technology: helpful but not sufficient
Scale matters
Extreme global inequalities: rich countries should
go first
6. Managing without growth in Canada
Firms
Economic
Cycle
Households
1. The economy: a sub-system of the biosphere
Firms
Economic
Cycle
Households
2. Excessive Burden on the Environment:
Transgressing Planetary Boundaries
Billion
tonnes
700%
100%
Global Materials Extraction 1900 to 2005
3. Technology: helpful but not sufficient
1946
1992
1970
2010
1946
1992
1970
2010
‘I would say this is most environmentally friendly cruise ship to date.
It is much more efficient than other similar ships.’ (Project engineer)
intensity
4. Material
Must address
scale is
as declining,
well as
intensitybut not fast enough
250
200
GDP
110%
Resource Extraction
150
47%
100
50
Material Intensity
29%
Key message:
Environmental impact depends on intensity and scale
0
1980
1985
GDP
1990
Resourc e extrac tion
1995
Populat ion
2000
2005
Material int ensit y
Energy consumption - same story
250
200
GDP
110%
Primary Energy
150
59%
100
50
Energy Intensity 24%
Key message:
Environmental impact depends on intensity and scale
0
1980
GDP
1985
1990
1995
Population
Primary Energy Consumption
2000
2005
Energy Intensity
5. Extreme global inequalities:
rich countries should go first
5. Managing without growth
Can we have full employment, no poverty, fiscal balance,
reduced GHG emissions without relying on economic growth?
LowGrow
Canada
You bet!
LowGrow
Canada
What makes an economy grow?
• Macro demand (what we
spend money on):
–
–
–
–
Consumption
Investment
Government
Trade
• Macro supply (what we can
produce):
– Labour
– Capital
– Productivity
‘Business as usual’
GDP per Capita
300
GHG Emissions
250
Poverty
200
150
100
Debt to GDP Ratio
Unemployment
50
0
2005
2010
2015
2020
GDP per capita
Unemployment
GHG emissions
Poverty
2025
2030
2035
Debt to GDP ratio
What happens if we eliminate increases
in all sources of economic growth?
(starting in 2010 over 10 years)
• Consumption
• Investment
• Government
• Trade
• Population/labour
• Productivity
A no growth disaster
300
Unemployment
250
Poverty
200
GDP per Capita
150
100
50
Debt to GDP Ratio
GHG Emissions
0
2005
2010
2015
2020
GDP per capita
Unemployment
GHG emissions
Poverty
2025
2030
2035
D ebt to GDP ratio
Larry Elliot (economics editor)
The Guardian Weekly 29th August 2008
‘The real issue is whether it is possible to
challenge the “growth-at-any-cost model”
and come up with an alternative that is
environmentally benign, economically
robust and politically feasible.’
A better low/no growth scenario
How?
• New meanings and measures of success
• Limits on materials, energy, wastes and land use
• Stable population and labour force
• More efficient capital stock
• Carbon price
• Shorter work year
• Fewer status goods
• More generous anti-poverty programs
• Education for life not just work
Unemployment
300
250
200
150
100
GDP per Capita
GHG Emissions
50
Poverty Debt to GDP Ratio
0
2005
2010
2015
2020
GDP per capita
Unemployment
GHG emissions
Poverty
2025
2030
2035
Debt to GDP ratio