SUSTAINABILITY AND DESIRABILITY OF ECONOMIC GROWTH

Topics: Economics, Karl Marx, Wealth Pages: 9 (1321 words) Published: August 6, 2014
İstanbul BİLGİ UNIVERSITY
SUSTAINABILITY AND DESIRABILITY OF ECONOMIC GROWTH

Zeynep Sıla SARIKAYA

I am going to analyse the problem of economic growth in this article. As we are all aware, in the world we live in, there is this huge question everyone is trying to answer: “Is economic growth desirable - and most importantly- sustainable?” There are roughly two sides on this subject. Green-leftists, who are not supporters of the economic growth; and liberals who argue that prosperity will occur when economic growth exists. I want to go way back, in order to understand when economic growth started.

Figure 1
According to the graph above, it started in the mid 1800s with the Industrial Revolution. It was a result of “mass production”, basically. Producing in mass amounts caused economic growth, this led to globalization, decrease of tariffs, international trade. As some people might argue, globalization is key for countries to have a strong economy. Globalization means that we can now solve our problems together and be heard by someone all across the world. Globalization has helped several illnesses, as Alex Tabarrok -a Professor of Economics- puts it, “globalization saves lives”. Figure 2

Figure 3

Figure 4
As we can see from Figure 2, life expectancy in 1800 was 40 in the UK where GDP per capita was around 3500 dollars, and about 27 in Cape Verde where GDP per capita was below 400 dollars. We can see from here that GDP per capita has a positive correlation with life expectancy, as years past, in 2012 as it is shown in Figure 3, same correlation applies. As Figure 4 clearly shows, child mortality has a negative correlation with GDP per capita. With economic growth, came better health care, wealth, technology, novelty, but that is just one side of the story. Economic growth also brought environmental problems. Carbon emissions, pollution, global warming… These are all world wide issues we have to deal with if we keep this track. First of all economics is the science of scarcity, as we can roughly describe it. So we have scarce resources, how do we keep growing? Most importantly, can we sustain this growth? Figure 5 (23.12.2013)

As Figure 5 shows, we have limited resources, which we are running out of very quickly. This indicates that economic growth is not sustainable. Alex Tabarrok disagrees, he claims that incentives are key to ideas, and scarcity will be an incentive for everyone to invest in new energy systems. He believes that humanity has overcome many disasters and with the help of technology we can lower carbon emissions -even invent a machine that can absorbe carbon from the atmosphere- and keep growing economically. Figure 6

Figure 6 indicates that there is a positive correlation between carbon emissions and GDP per capita. Here, I would like to refer to Tim Jackson who is a professor at University of Surrey. “I want you to imagine a world, in 2050, of around nine billion people all aspiring to Western incomes, Western lifestyles. And I want to ask the question: How far and how fast would we have to move?...The carbon intensity of economic growth at the moment is around 770 grams. In the world i describe you we have to be at six grams of carbon. It’s a 130-fold improvement and that is 10 times further and faster than anything we’ve achieved in industrial history.” I went further on my research and found some data on something called an “ecological footprint”. It shows that we would need 7.2 worlds if everyone lived like the average American1. This means, people who insist that economic growth will bring wealth and everyone will have western lifestyles, are mistaken. If everyone on Earth had Western lifestyles, non of us would survive. We have the “developing” countries to thank for that. Even if we had this “blind faith in our cleverness” as Tim Jackson puts it, economic growth did not only bring environmental issues. It has also brought inequality in human society....
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