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Working group on growth imperatives
The scientific debate about sustainability is still controversial regarding the existence of so called “growth imperatives”. While many authors argue that the fixation on growth is mainly a question of mentality, others suspect that a structural growth imperative exist. They describe its causes with different approaches, disputed for their plausibility. The goal of this working group is to provide a complete and detailed overview of the current state of research, and to categorize and to evaluate the explanations.
On February 4 and 5, 2017, we organized a workshop on growth imperatives at University Witten/Herdecke.
The contribution “How imperative are the Joneses? Economic Growth between Individual Desire and Social Coercion” (VÖÖ Discussion Paper 4) presents a well-founded definition of the term “growth imperative” that was heretofore only defined on the macro level or used colloquially. Based on this definition, we study different hypotheses from the literature arguing that consumers or producers are subject to a growth imperative because of socio-cultural mechanisms (growth paradigm). We show that these hypotheses are not based on a sound foundation: Either they refer to economic pressure (including competitive advantage through innovations), or they do not meet our demands on an explanation
In the article “Effizienzkonsum: Produktivitätssteigerung als Beschreibungsrahmen bestimmter Konsum-Entscheidungen” (VÖÖ Discussion Paper 3), Andreas Siemoneit discusses the thesis that both enterprises and consumers buy certain goods to increase efficiency. This creates positive feedbacks that can be interpreted as growth imperative. While increasing efficiency is since long accepted as investment motive for enterprises, it is not discussed as consumption motive by neither microeconomics nor consumption sociology.
The paper “Consistency and Stability Analysis of Models of a Monetary Growth Imperative” (Ecological Economics 136, pp. 114–125) presents an analysis of two lines of arguments locating a systemic growth imperative within the monetary system: Suspected are on the one hand interest-bearing credit money, and on the other hand the hoarding of profits by commercial banks. We find that both reasonings are not plausible and should therefore be rejected. There is no systemic growth imperative within the monetary system.
The article “Fear of stagnation? A critical review on growth imperatives” (VÖÖ Discussion Paper 6) completes our analysis: We go through “classical” and new theories why the economy would be subject to a growth imperative: competition and profit orientation, technical progress, public growth policies, money, and socio-cultural mechanisms (referring to our specialized papers for the last two categories). Our result is unambiguous: Only technical progress, quite unidirectionally substituting human labour with resource consuming machinery, has the potential to drive a market based society to distraction. The ostensible driving force of public growth policies reacts mainly on technological unemployment, created by process innovations that are not compensated by product innovations. Accumulation, inequality and credit money (for investing without prior saving) exaggerate the problem due to different effects. It is not the case that a single mechanism is “responsible”, but we consider technical progress and the corresponding resource use nonetheless as supreme in the “hierarchy of reasons”. An escape from this dilemma might be institutional restrictions of resource consumption (Cap & Trade) and the limitation of accumulation. “Overcoming” market economy is not necessary.
- Oliver Richters, Andreas Siemoneit: Fear of stagnation? A review on growth imperatives. VÖÖ Discussion Paper 6, March 2017. (Download PDF)
- Oliver Richters, Andreas Siemoneit: How imperative are the Joneses? Economic Growth between Desire and Social Coercion, VÖÖ Discussion Paper 4, January 2017 (Download PDF).
- Oliver Richters, Andreas Siemoneit: Consistency and Stability Analysis of Models of a Monetary Growth Imperative, Ecological Economics 126, June 2017, pp. 114–125. Preprint as VÖÖ Discussion Paper 1, February 2016.