Tag Archives: green growth

September 2023 in Review

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Most frightening and/or depressing story: “the accumulation of physical and knowledge capital to substitute natural resources cannot guarantee green growth“. Green growth, in my own words, is the state where technological innovation allows increased human activity without a corresponding increase in environmental impact. In other words, this article concludes that technological innovation may not be able to save us. This would be bad, because this is a happy story where our civilization has a “soft landing” rather than a major course correction or a major disaster. There are some signs that human population growth may turn the corner (i.e., go from slowing down to actually decreasing in absolute numbers) relatively soon. Based on this, I speculated that “by focusing on per-capital wealth and income as a metric, rather than total national wealth and income, we can try to come up with ways to improve the quality of human lives rather than just increasing total money spent, activity, and environmental impact ceaselessly. What would this mean for “markets”? I’m not sure, but if we can accelerate productivity growth, and spread the gains fairly among the shrinking pool of humans, I don’t see why it has to be so bad.”

Most hopeful story: Autonomous vehicles kill and maim far, far fewer human beings than vehicles driven by humans. I consider this a happy story no matter how matter how much the media hypes each accident autonomous vehicles are involved in while ignoring the tens of thousands of Americans and millions of human beings snuffed out each year by human drivers. I think at some point, insurance companies will start to agree with me an hike premiums on human drivers through the roof. Autonomous parking also has a huge potential to free up space in our urban areas.

Most interesting story, that was not particularly frightening or hopeful, or perhaps was a mixture of both: Venice has completed a major storm surge barrier project.

Is “green growth” possible?

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Green growth is the holy grail where human wellbeing is able to grow exponentially over the long term without depleting natural resources including the natural environment’s ability to assimilate our wastes. I won’t claim to understand all the words in this abstract, but the author is basically coming up with a big fat NO.

Is green growth possible and even desirable in a spaceship economy?

There seems to be a consensus among many growth and resource economists that perpetual growth can be ensured if it gets increasingly resource-efficient and if growth focuses on creating values, a result derived by models using production functions that allow asymptotically complete decoupling of the economy from its resource base by substituting natural resources through physical and knowledge capital. This growth process can be called green growth. The following paper attempts to show, within the framework of an semi-endogenous growth model using a linear-exponential production function (Linex function) with bounded resource efficiency, that the accumulation of physical and knowledge capital to substitute natural resources cannot guarantee green growth. As the population grows, per capita income decreases, and the economy’s capital base decays. In addition, an ecological displacement effect resulting from the biophysical embeddedness of the economy further exacerbates the result. Physical capital pushes back the natural spaces necessary to regenerate natural services and resources and can, therefore, not be accumulated endlessly. A comparison with standard resource models shows that this displacement effect also limits growth for models with production functions with low elasticities of substitution. Finally, the analysis of transitory dynamics addresses aspects of intergenerational equality in a limited biosphere.

I’ll take a crack at interpreting this. The human economy cannot be fully separate from the natural environment because it will always result in some physical displacement, even if pollution could be eliminated. Well, what if all human enterprise were built on stilts well above the earth? All food would also be grown on these stilts, all materials recovered and cycled endlessly. This would shade out natural ecosystems, but you could use giant space mirrors to beam in sunlight that would otherwise have uselessly bypassed the earth (which is all but a vanishingly tiny fraction of sunlight). Now, you might say why not just go live in orbit? But the advantage of my scheme is that you can just take an elevator down to the earth, and the entire earth is a park for your enjoyment. What about tigers, you say? Well, we will just invite those rolling bubble things from Jurassic Park.