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M. Conte Grand
idea of energy to resources: when resources are used for human activities, part of
them are lost and are impossible to recover. The ideas of that Romanian scientist
were closely followed by one of his students (Daly 1973) and were the base of what
is nowadays the brand of economics called “ecological economics”.
The followers of that rather pessimistic point of view believe that the limits of the
planet are getting closer and the solution is to “degrowth” Weiss and Cattaneo (2017)
and Cosme et al. (2017) review all publications in this line of literature and affirm that
it has been increasing in the last years. According to the latter authors, from the first
academic paper that used the term “degrowth” (in 2006) to date, the number of web
pages using that word has multiplied by 20. Strictly speaking, the “degrowth” strategy
implies not a continuous decrease of economic activities, but rather a transition to
a new steady state that considers the limits of the planet. According to ecological
economists, the environmental problems can be attributed to an excessively large
economy that goes beyond the capacity of nature. They consider there is a problem
of scale (Daly 1973). They do not see economic growth as a solution, but rather as
a problem. “Degrowth” is a mean to solve the crisis of the planet. As pointed out
by Kallis (2011, p. 874), “sustainable degrowth is not equivalent to negative GDP
growth in a growth economy. This has its own name: recession, or if prolonged,
depression.” The “degrowth” solution consists of reaching a new equilibrium, to
then allow a growing economy that uses less resources.
The main criticism to the literature of “degrowth” is that the arguments are well
described but its feasibility analysis is poor (see in that respect Martínez-Alier et al.
2010; Cosme et al. 2017; Weiss and Cattaneo 2017). Kallis (2011, p. 874) justify this
arguing that “degrowth” is an “umbrella keyword.. It has to do with understanding
the limits of nature, not to expect technological miracles. Moreover, Jakob y Edenhofer (2014) point out, based on the IPAT identity (I = P·A·T with “I” denoting
Impact–emissions—, “P” = Population, “A” = Affluence-per capita GDP—and
“T” = Technology -emissions per unit of GDP), reducing emissions 5% annually
with a 0.7% increase in population, even if GDP does not change, would require a
5.7%, decrease in emissions intensity, which is not low. They state that it makes little
sense to attempt to decrease emissions (I) focusing on decreasing growth (A) when
in fact it can be made in a more effective way focusing on other type of policies that
emphasize changes in population trends and technology (P and T). Finally, even if it
may seem attractive to “degrowth” and live a simpler life, working less hours, it can
have negative implications for developing economies, where a minimum material
quality of life has not been yet attained (see Martínez-Alier et al. 2010, p. 1743 in
that respect).
The second point of view, “green growth”, is more optimistic. The term has its
origin in 2009, when after the financial crisis the Organization for Economic Cooperation and Development (OECD) published the Declaration on Green Growth. In
its considerations, it states: “Green growth will be relevant going beyond the current
crisis, addressing urgent challenges including the fight against climate change and
environmental degradation, enhancement of energy security, and the creation of new
engines for economic growth.” (OECD 2009, p. 1). Green growth followers believe
that it is possible to increase economic activities taking into account the environment.
M. Conte Grand
idea of energy to resources: when resources are used for human activities, part of
them are lost and are impossible to recover. The ideas of that Romanian scientist
were closely followed by one of his students (Daly 1973) and were the base of what
is nowadays the brand of economics called “ecological economics”.
The followers of that rather pessimistic point of view believe that the limits of the
planet are getting closer and the solution is to “degrowth” Weiss and Cattaneo (2017)
and Cosme et al. (2017) review all publications in this line of literature and affirm that
it has been increasing in the last years. According to the latter authors, from the first
academic paper that used the term “degrowth” (in 2006) to date, the number of web
pages using that word has multiplied by 20. Strictly speaking, the “degrowth” strategy
implies not a continuous decrease of economic activities, but rather a transition to
a new steady state that considers the limits of the planet. According to ecological
economists, the environmental problems can be attributed to an excessively large
economy that goes beyond the capacity of nature. They consider there is a problem
of scale (Daly 1973). They do not see economic growth as a solution, but rather as
a problem. “Degrowth” is a mean to solve the crisis of the planet. As pointed out
by Kallis (2011, p. 874), “sustainable degrowth is not equivalent to negative GDP
growth in a growth economy. This has its own name: recession, or if prolonged,
depression.” The “degrowth” solution consists of reaching a new equilibrium, to
then allow a growing economy that uses less resources.
The main criticism to the literature of “degrowth” is that the arguments are well
described but its feasibility analysis is poor (see in that respect Martínez-Alier et al.
2010; Cosme et al. 2017; Weiss and Cattaneo 2017). Kallis (2011, p. 874) justify this
arguing that “degrowth” is an “umbrella keyword.. It has to do with understanding
the limits of nature, not to expect technological miracles. Moreover, Jakob y Edenhofer (2014) point out, based on the IPAT identity (I = P·A·T with “I” denoting
Impact–emissions—, “P” = Population, “A” = Affluence-per capita GDP—and
“T” = Technology -emissions per unit of GDP), reducing emissions 5% annually
with a 0.7% increase in population, even if GDP does not change, would require a
5.7%, decrease in emissions intensity, which is not low. They state that it makes little
sense to attempt to decrease emissions (I) focusing on decreasing growth (A) when
in fact it can be made in a more effective way focusing on other type of policies that
emphasize changes in population trends and technology (P and T). Finally, even if it
may seem attractive to “degrowth” and live a simpler life, working less hours, it can
have negative implications for developing economies, where a minimum material
quality of life has not been yet attained (see Martínez-Alier et al. 2010, p. 1743 in
that respect).
The second point of view, “green growth”, is more optimistic. The term has its
origin in 2009, when after the financial crisis the Organization for Economic Cooperation and Development (OECD) published the Declaration on Green Growth. In
its considerations, it states: “Green growth will be relevant going beyond the current
crisis, addressing urgent challenges including the fight against climate change and
environmental degradation, enhancement of energy security, and the creation of new
engines for economic growth.” (OECD 2009, p. 1). Green growth followers believe
that it is possible to increase economic activities taking into account the environment.