Managing without Growth Dr. Peter A. Victor York University Canada Thursday June 10, 2010.

Managing without Growth

Dr. Peter A. VictorYork University

Canada

Thursday June 10, 2010

Outline

1. The economy: a sub-system of the biosphere2. Transgressing planetary boundaries3. Technology: helpful but not sufficient4. Scale matters5. Extreme global inequalities: rich countries should

go first6. Managing without growth in Canada

Firms HouseholdsEconomic Cycle

Firms HouseholdsEconomic Cycle

1. The economy: a sub-system of the biosphere

2. Excessive Burden on the Environment:Transgressing Planetary Boundaries

Billiontonnes Global Materials Extraction 1900 to 2005

100%

700%

3. Technology: helpful but not sufficient

1946 1970

1992 2010

1946 1970

1992 2010

‘I would say this is most environmentally friendly cruise ship to date. It is much more efficient than other similar ships.’ (Project engineer)

0

50

100

150

200

250

1980 1985 1990 1995 2000 2005

GDP Resource extraction Population Material intensity

Material intensity is declining, but not fast enough

47%

110%

29%

Key message:Environmental impact depends on intensity and scale

GDP

Resource Extraction

Material Intensity

4. Must address scale as well as intensity

Energy consumption - same story

0

50

100

150

200

250

1980 1985 1990 1995 2000 2005

GDP Population Primary Energy Consumption Energy Intensity

59%

Key message:Environmental impact depends on intensity and scale

110%

24%

GDP

Primary Energy

Energy Intensity

5. Extreme global inequalities: rich countries should go first

LowGrow Canada

Can we have full employment, no poverty, fiscal balance,

reduced GHG emissions without relying on economic growth?

5. Managing without growth

LowGrow Canada

You bet!

What makes an economy grow?

• Macro demand (what we spend money on):– Consumption– Investment– Government– Trade

• Macro supply (what we can produce):– Labour– Capital– Productivity

‘Business as usual’

0

50

100

150

200

250

300

2005 2010 2015 2020 2025 2030 2035

GDP per capita Unemployment Debt to GDP ratio

GHG emissions Poverty

GDP per Capita

GHG Emissions

Poverty

UnemploymentDebt to GDP Ratio

What happens if we eliminate increases in all sources of economic growth?

(starting in 2010 over 10 years)

• Consumption• Investment

• Government• Trade

• Population/labour• Productivity

A no growth disaster

0

50

100

150

200

250

300

2005 2010 2015 2020 2025 2030 2035

GDP per capita Unemployment Debt to GDP ratio

GHG emissions Poverty

GDP per Capita

GHG Emissions

Poverty

Unemployment

Debt to GDP Ratio

‘The real issue is whether it is possible to challenge the “growth-at-any-cost model” and come up with an alternative that is environmentally benign, economically robust and politically feasible.’

Larry Elliot (economics editor)The Guardian Weekly 29th August 2008

A better low/no growth scenario

0

50

100

150

200

250

300

2005 2010 2015 2020 2025 2030 2035

GDP per capita Unemployment Debt to GDP ratio

GHG emissions Poverty

How? • New meanings and measures of success• Limits on materials, energy, wastes and land use• Stable population and labour force• More efficient capital stock• Carbon price • Shorter work year• Fewer status goods• More generous anti-poverty programs• Education for life not just work

GDP per Capita

GHG EmissionsUnemployment

Poverty Debt to GDP Ratio