The Steady State Path to Real Prosperity A Bigger Economy Doesn’t Mean a Better Economy

The Steady State Path to Real Prosperity

A Bigger Economy Doesn’tMean a Better Economy

www.steadystate.org

by  mattyp

by treehouse1977

The Nature of Growth

Grow \ˈgrō\ verb1.To spring up and develop to maturity2.To increase in size

Desirability of growth depends upon...

1. The entity that’s growing: e.g., a human body

2. The context: e.g., stage of life

3. The rate: e.g., slow, normal, fast

Context: ChildrenRate: Normal

Growth is desirable.

Context 1: Child Rate 1: Very fast

Context 2: AdultRate 2: Slow

Growth isundesirable.

Growth of Economic Activity

For economic growth to occur, what exactly is getting bigger?

Production and consumption of goods and services (more stuff and more activity)

Gross domestic product (GDP), the final dollar value of goods and services produced

Population, consumption per person, or both.

USA – 14,260,000

Japan – 4,924,000

China – 4,402,000

Germany – 3,668,000

France – 2,866,000

UK – 2,674,000

Italy – 2,399,000

Russia – 1,757,000

Spain – 1,683,000

Brazil – 1,665,000

Canada – 1,564,000

India – 1,237,000

Source: CIA Factbook

GDP Growth

Context for GDP Growth

Wasteproducts

$

$Wasteproducts

$$$

$$$

Resources WasteResources Waste

Context: Thermodynamic Limits to Growth

Time

GD

P Natural capital allocatedto theeconomy

Naturalcapital allocatedtonature

KC a r r y i n g C a p a c i t y

E c

o n

o m

i c

G r

o w

t h

Context: Ecological Limits to Growth

Context: Disappointing Results of Growth

Income per person

Happiness(index)

Source: Inglehart andKlingemann (2000)

Context: Disappointing Results of GrowthU

.S.

Per

cen

tag

e V

ery

Hap

py

Real incomeper person

Percentage very happy

Source: Layard (2005)

Context: Disappointing Results of Growth

Context: Disappointing Results of Growth

Rate of Increase

World GDP (1990 millions of dollars), source: Angus Maddison

Desirability of Growth

by  mattyp

Steady State Economy: Better not Bigger

• Constant (or mildly fluctuating) population

• Constant (or mildly fluctuating) percapita consumption

• Constant (and sustainable) throughputof energy and materials

• Sustainable scale

• Fair distribution of wealth

• Efficient allocation of resources

• High quality of life

• Right-sized

• Smaller population

• New measures of success

• Different labor/capital mix

• Shorter working hours/more leisure

• More nature

• Fewer status goods

• Healthier food systems

• Better use of technology

• More locally supplied goods and services

• Science-based decision making

• Less debt

• Less production, more maintenance

What Does a Steady State Economy Look Like?

What Does a Steady State Economy Look Like?

Less of this......and more of this.

What Does a Steady State Economy Look Like?

Less of this......and more of this.

What Does a Steady State Economy Look Like?

Less of this......and more of this.

What Does a Steady State Economy Look Like?

Less of this......and more of this.

What Does a Steady State Economy Look Like?

Less of this......and more of this.

What Does a Steady State Economy Look Like?

Less of this......and more of this.

by treehouse1977

1. Start with given conditions.

2. Employ gradualism.

3. Change policies.• Exemplary network of conservation lands• Cap-auction-trade systems for basic resources• Limits on the range of inequality in income distribution• Ecological tax reform• Move to 100% reserve requirements• Elevate the commons sector• Reform national accounts

4. But don’t put the cart before the horse.• We need widespread public support.• We need all those analytical economic minds working on the new paradigm.

The Transition from Growth to a Steady State

Policy Change – The Right Goal

Policy Change - Exemplary Conservation

"Last year's introduction of Dentyne Ice Cinnamint gum, right on the heels of the extinction of the Carolina tufted hen, put product diversity on top for the first time.”

Copyright: The Onion

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Policy Change: Technology

Appropriate Use of Technology

Bob Adelman, Magnum Photos

Getting Started

What Can You Do?

1. Publicly voice your opinion.

Sign the Positionon Economic Growth.

What Can You Do?

2. Get informed.

www.steadystate.org

What Can You Do?

3. Get involved with CASSE.

Become a member.

Become an outreach volunteer.

What Can You Do?

4. Think and act like a steady stater.

5. Ask a lot of questions.

What Can You Do?

www.steadystate.org