Prosperity without growth

There has been a lot of interest in whether it is possible that our current economic system and its reliance on growth is compatible with the idea of a more sustainable society. Tim Jackson explored this in depth in a 2009 report for the British Sustainable Development Commission and subsequent book.   


Tim Jackson argues that our current societal path that requires economic growth for prosperity is unsustainable. He proposes three main steps that are required to change our
trajectory; 1) macro-economic reforms that change the emphasis away from growth and consumption and increased labour productivity 2) changing social structures to increase social capital, reduce competitive consumerism and reduce inequality and 3) respecting ecological limits.


There is evidence that prosperity requires economic growth to provide stability, basic social services and that prosperity is based on material opulence. Growth is necessary to prevent economic collapse by stabilizing employment in response to increased productivity, which would otherwise result in reduced employment; “growth may be unsustainable, but ‘de-growth’ appears to be unsustainable”. Jackson argues that “absolute decoupling” of the economy from resource consumption is required to have an ecologically sustainable system, and e.g. stabilizing the climate will require a substantial decoupling of growth and carbon intensity. He argues that this is not likely to occur within our current economic framework. Growth is also being driven by the “production and consumption” of novel material goods, and that stability of the economic system requires growth in consumption. This pattern also leads to anxiety and reduced social wellbeing as a result of the social comparisons required in forming status and identity.


Jackson argues that prosperity is possible without economic growth. He proposes a macro-economic model that does not use GDP as its main metric, and where increasing labour productivity is not required and there is an increasing emphasis on non-material services. Jackson himself admits that this is a speculative approach and that no economies currently operate this way. Jackson also argues that social changes away from consumerism are required to deliver prosperity without growth. While prosperity requires “material sustenance”, there are important social and psychological dimension of prosperity that are currently undervalued. Goals that embed people with social networks of family and community at the expense of goals related to social status may lead to increased happiness and sustainability. This can be achieved by removing incentives for status competition, and establishing structures that provide social capabilities.