For decades, governments around the world have focused on one main goal: economic growth. Growth was seen as the best way to reduce poverty, create jobs, and improve living standards. But growth also damages Earth systems, increases inequality, and undermines social cohesion.
In this subtopic, you will explore why economic growth became such a central goal and what it does and does not deliver. You will examine the system traps that keep business and politics locked into growth goals, and learn about two very different responses: green growth and degrowth. You will also look at two other key state goals, employment and price stability, where we need new approaches to ensure meaningful work and affordable living.
Finally, you will explore new ways of measuring progress. Wellbeing indicators and the Doughnut model offer a broader picture of what matters. They help us ask better questions about what the economy is for, and how states can support economies that meet human needs within ecological limits.
At the end of Subtopic 5.3 you should be able to:
define economic growth
explain how economic growth is measured, and what it misses
discuss the economic, social and ecological impacts of economic growth
discuss the financial, and social/political drivers of economic growth dependency
discuss the concept of green growth and its challenges
discuss the concept of degrowth and its challenges
explain how wage labour became so dominant in market economies
explain how unemployment is calculated
discuss why different types of work are valued differently in our current economies
explain how the state can support regenerative work
explain the importance of price stability and how it is measured
explain why price levels change, including demand-pull and cost-push factors and the role of reinforcing feedback loops of expectations
discuss the uses and limitations of current state strategies for price stability, and alternatives that could support regenerative economic goals
outline the importance of wellbeing indicators to state policies
describe the components of and interpret various wellbeing composite indicators, for example the HDI, IHDI, GDI, PHDI, OECD Better Life Index or others
describe the UN Sustainable Development Goals and the progress made on their achievement
describe how cities and regions are using the Doughnut Economics model to understand their economics and redesign them to meet human needs within planetary boundaries