How ‘Nature’ Has Fallen

by Don Boudreaux on December 16, 2022

in Energy, Environment, Growth, Myths and Fallacies, The Profit Motive

Here’s a letter to Nature, which just published a paper that is an excellent candidate for the most idiotic publication of 2022.

Editor:

We know from the get-go of Jason Hickel’s, et al.’s, article “Degrowth can work – here’s how science can help” (Dec. 12) that the authors’ understanding of economic reality is so fundamentally flawed that nothing that appears in the article should be taken seriously.

Specifically, the article’s subheading – which accurately summarizes the authors’ thesis – reads: “Wealthy countries can create prosperity while using less materials and energy if they abandon economic growth as an objective.” This claim is grammatically correct gobbledygook.

Because the very meaning of economic growth is greater per-person prosperity, to propose abandoning economic growth as a means of creating economic prosperity is a preposterous contradiction.

Further, contrary to the authors’ implication, wealthy countries have been creating prosperity by using less materials and energy since the dawn of the industrial age. That’s how economies grow. Indeed, that’s the only way for economies to grow. Economists’ uninspired name for this process is an increase in total factor productivity – meaning that the amount of inputs required to produce a given amount of economic output falls (implying, of course, that a given amount of inputs come to be able to produce greater economic output, resulting in economic growth).

And because producing more (and better) with less is the source of profit, an essential driver of economic growth – that is, an essential driver of producing more with less – is the entrepreneurial quest for profit. As shown by Stanford University economist Gavin Wright,* and more famously by the late Julian Simon** – and as Marian Tupy and Gale Pooley*** have painstakingly more recently documented – innovative capitalism has steadily increased supplies of resources.

Therefore, rather than forsake free-market capitalism as the authors propose, optimal growth in prosperity, and its accompanying incessant increases in resource conservation, requires that markets be made more free.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

* Gavin Wright, “The Origins of American Industrial Success, 1879-1940,” American Economic Review, Vol. 80, September 1990, pages 651-668.

** Julian L. Simon, The Ultimate Resource 2 (Princeton: Princeton University Press, 1996).

*** Marian L. Tupy and Gale Pooley, “Resources Are More Abundant Than Ever, and People Are the Reason,” Cato Unbound, April 21, 2021. See also Tupy’s and Pooley’s remarkable 2022 book, Superabundance.

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