Why would you care about economic growth in absolute terms instead of productivity per person?
If I know I'll be selling 20% less widgets in 5 years as population falls, I wont upgrade my widget making machines. Suddenly the people making widget making machines are all unemployed. They stop buying widgets and my sales fall even further. That's ok when it happens in one sector but what about when it happens in every sector?
There are other examples: researching a cure for a disease might make sense if there are 100,000 sufferers but not 20,000. If x% of the economy is used for scientific research, you can afford a lot more LHCs with 500m people than 50m.
Growth has to fall as we have to cut population or nature will do on it for us. But it will be a difficult project with strange political outcomes.
Isn't it time to switch to plugin making machines then ? Setup a market opportunities study to try and see how to recycle skills, know-hows and professional network?
That's sort of the issue here: too many people, not enough jobs. And an economic/political system that assumes getting a job is possible for everyone.
More likely they are going to retire before they are unemployed. Working age population always declines earlier than population as a whole.
I think it's pretty clear that there is a rate of population decline that is consistent with rising living standards as long as the decline is ultimately limited.
We should indeed focus far more on productivity. If the number of sufferers from a disease falls to a fifth while research productivity increases five times, finding a cure will make just as much sense as before.
Im all for productivity, but we are very very bad at making sure productivity growth doesn't mean shrinking incomes for the majority. So be careful welcoming the closure of the widget machine factory (or it getting more efficient and laying people off).
There is a rate of population decline that's consistent with economic growth. But its very small.
Three things generally grow economies: pop growth, productivity improvement and technological advance. If your pop growth is negative, you need the others to be big positives. Except that productivity growth is hard to achieve, hard to measure, and (as above) needs a lot of political management to achieve without leading to serious social issues. So you're reliant on technology. And technology isn't really moving much at the moment.
Japan and China have both suffered these combined effects for a while. Falling, aging populations. China has been fine because they can increase both the technological and productivity levels of its economy. It can move from doing things manually to semi automation (now basically done) and it can move from doing low productivity work (putting things together) to making entirely new products. Japan can do either.
Thats why China has managed huge growth (maybe not as good as they like to claim but still) over the last 30 years. And Japan has basically languished.
We are turning into Japan, not China.
I didn't say economic growth. I said living standards. The important difference is that living standards can go up while GDP is falling.
>We are turning into Japan, not China.
Japan proves my point. The country isn't exactly impoverished, nor is it getting any poorer. They have very low unemployment and GDP per capita has grown about 10% between 2010 and 2018. That's compared to 12.5% for the US. Not a bad outcome in spite of a steep decline in population.
(People beating the growth-growth-growth drum are also typically on the rich end of the spectrum btw).
Or, I think I've heard it said better, "If the purpose of life isn't 'maximizing shareholder value', we're fucked".
Which is exactly what is happening. By every metric imaginable the entire population of the planet is gaining in wealth. Some quicker then others. But gains are largely universal. Poverty is at it's lowest point in all of human history. And in a month it'll be even lower.
Also when wealth goes up, overall consumption as measured by actual natural resources consumed goes down. People have this misconception that increased wealth equals increased consumption, which is hardly the case. Wealth represents a increase in well being, which more often then not, is a result of increased efficiency.
By 'increased efficiency' I mean less human effort is required to produce more with less.
https://en.wikipedia.org/wiki/Wealth_inequality_in_the_Unite...
Imagine country A, awesome with very little income inequality. Half it’s citizens earn 9k a year and the other half 10k a year.
Now country B, is very bad. 90% make 50k a year and the other 10% make 500k. That’s terrible, isn’t it? I wouldn’t want to live in country B.
Never in the history of the world have the poor had less than nothing.
“ What Roser’s numbers actually reveal is that the world went from a situation where most of humanity had no need of money at all to one where today most of humanity struggles to survive on extremely small amounts of money. The graph casts this as a decline in poverty, but in reality what was going on was a process of dispossession that bulldozed people into the capitalist labour system, during the enclosure movements in Europe and the colonisation of the global south.” [1]
[1] https://www.theguardian.com/commentisfree/2019/jan/29/bill-g...
Of course, economic growth is not sufficient for this, but it is necessary.
Many countries have social security systems that rely on the economy being big enough to pay for it.