On the Value of Economic Growth #5 – The value of infinite growth

5.   The normative value of perpetual growth

According to Brian Kogelmann, normative arguments in favour of economic growth can generally be divided into two categories: wealth-sensitive and wealth-insensitive arguments, or wealth-dependent and wealth-independent arguments (cf. Kogelmann 2022, p. 478). Wealth-sensitive arguments imply that growth is only necessary to achieve a normatively desirable level of prosperity, which is why: “If a country is sufficiently rich, then a wealth-sensitive argument will not advocate growth. By contrast, a wealth-insensitive argument will say that all countries should pursue growth regardless of their current level of wealth.” (ibid.)

If growth is to have a normative meaning in general, the justification for the normative value of growth must therefore be primarily independent of the level of prosperity of the society in question. Arguments that suggest that further growth enables the achievement of a defined, normatively desirable level of prosperity do not invalidate the second basic idea of the stationary state paradigm. They only attribute a temporary normative value to growth as a means of achieving this stationary state level of prosperity. In doing so, they merely postpone the point at which the paradigm applies again into the future. In order to show that economic growth in itself has a significant normative meaning – in the sense that it is always normatively desirable for a society to grow economically – it is therefore important to develop arguments in favour of growth that are independent of prosperity (cf. Kogelmann 2022, p. 478). At its core, the second idea of the stationary state paradigm is therefore primarily based on a rejection of arguments that are independent of prosperity.

However – and this is where this work contradicts Kogelmann – prosperity-based arguments in favour of growth can, under certain circumstances, function as effective arguments against the stationary state paradigm, albeit not in principle, but in practice. Namely, when they set the maximum normatively desirable level of prosperity far beyond what humanity has achieved or could achieve. For example, an argument that locates the normatively desirable level of prosperity of humanity at the level of a type III civilisation on the Kardashov scale (cf. Kardashev 1967, p.219) and normatively upgrades any growth in this direction would in principle not refute the stationary state paradigm. However, it would shift the stationary state so far into the uncertain future that the paradigm would lose all practical relevance from the perspective of all people living today and their immediate descendants. Prosperity-based arguments of this kind will therefore also be discussed below.

According to Kogelmann, wealth-insensitive arguments in favour of economic growth can ultimately be differentiated into indirect and direct arguments. Indirect arguments do not assume that economic growth is always better, but that preventing growth would require morally reprehensible measures (cf. Kogelmann 2022, p. 479). While direct arguments assume that growth itself has a positive normative value, as it brings about desirable conditions. This distinction is followed in the categorisation and evaluation of the following arguments.

5.1 The immorality of the growth freeze

Kogelmann himself identifies only one argument for perpetual growth, namely the indirect argument that “we are committed to continued economic growth – not because there is a direct argument in defence of growth, but because stopping growth would require actions that are morally objectionable” (cf. Kogelmann 2022, p.483 – 484).

Kogelmann’s argument can be summarised as follows (cf. Kogelmann 2022, p. 485):

  1. Under the right social conditions, economic growth will take care of itself in the long term.
  2. In order to stop economic growth, a society would have to change these growth-promoting conditions.
  3. However, we have independent moral reasons to maintain these conditions, regardless of their effect on economic growth.
  4. Changing these conditions would be morally wrong.
  5. Accordingly, it would not be possible to prevent economic growth in a morally acceptable way, and we are thus indirectly committed to further growth.

Of the conditions mentioned in premise 3, Kogelmann identifies three categories (cf. ibid. p.485), which are also confirmed by endogenous growth theories (cf. Aghion 2023, p.32, 292):

Firstly, building on Acemoglu and Robinson’s institutional theory of economic growth, he argues that growth is enabled and promoted by inclusive political and economic institutions that characterise democracy. If one wanted to stop growth, this would only be possible by abolishing democratic institutions (cf. Kogelmann 2022, p. 485).

Secondly, building on the work of Joel Mokyr, Kogelmann argues that economic growth is primarily driven by the accumulation and dissemination of knowledge and thus by freedom of research and thought. A state could therefore only suppress growth in the long term with a regime of censorship and bans. However, such undemocratic interference in individual autonomy is morally unacceptable (cf. ibid., p.486).

Thirdly, Kogelmann argues, building on the work of Deirdre McCloskey, that the phase of global growth since the Enlightenment is due to the fact that an ethical framework has been established according to which people involved in trade and seeking economic advancement are treated with dignity.  Based on this, economic growth could only be suppressed in the long term if society stratified itself again, as was often the case in earlier feudal societies, and discriminated against those involved in trade and trying to rise economically – something that would not be morally acceptable (cf. Kogelmann 2022, p.487).

The obvious first objection to Kogelmann’s argument is that it is quite logically possible that the conditions he describes as both normatively desirable and growth-promoting could also exist in a stationary state – he already addresses this objection himself in We Must Always Pursue Economic Growth.  According to Kogelmann, the mere logical possibility of this coexistence is not an objection to his argument as long as this possibility is not also plausible – and according to Kogelmann it is not. First and foremost, it is plausible that growth-promoting conditions actually lead to growth if they exist (cf. Kogelmann 2022, p. 487).

Kogelmann explains that representatives of the stationary states paradigm such as Mill or Keynes often assume in their theories that, once a certain level of material prosperity has been achieved, all people would voluntarily work less or not at all and would no longer strive for an increase in prosperity or wealth. This would mean that even under normatively desirable and growth-promoting conditions, such as the existence of democratic institutions, growth would come to a standstill (cf. ibid.).

There are two objections to this assumption of the representatives of the stationary state paradigm:

1) One objection that Kogelmann himself does not make is that growth can proceed even with falling working hours as long as the increase in productivity through innovation more than compensates for this. An increase in economic growth despite rapidly falling working hours is also something that has already been empirically proven to have happened and continues to happen. For example, the average working time per capita has more than halved in most countries over the past 150 years (see Giattino 2020). A continuation of this trend seems plausible, especially with an increasing degree of automation of economic production through the implementation and further development of artificial intelligence, for example. This could eventually even progress to the point where even the growth-driving research and development of new technologies is automated and requires little or no human input. The possibility of AI reaching a point of singularity at which it can automatically develop itself and other technologies further seems plausible (cf. Bostrom 2014, p. 90). From such a point, economic growth could continue even if humanity did not work at all. In his post-humanist revision of Marxist dialectics, Nick Land, for example, predicts the emergence of just such a technocapitalist singularity, in which the expansive dynamics of capitalism take on a life of their own and make humans redundant as an input factor, as the actual logical end of history (cf. Land 2013, p.16).

2) The second objection raised by Kogelmann himself against this assumption of the representatives of the stationary state is that the changes in the morality and human nature of people assumed by Mill or Keynes upon reaching the stationary state are not plausible and are not explained by them (cf. Kogelmann 2022, p.488). Why should people stop working or no longer strive for wealth just because they themselves or society have reached a certain material level? For some people, work may only be a purely instrumental way to achieve a certain level of material goods. These people would indeed swap work completely for leisure at any time once they had reached this level, but there is no doubt that not everyone would. Otherwise, for example, there would be no billionaires like Elon Musk, Bernard Arnault or Mark Zuckerberg who are still working even though they have accumulated more wealth than they could reasonably spend in their lifetime.

For many people, work obviously not only fulfils an instrumental purpose, but also serves to satisfy basic post-material needs such as the opportunity to come together with others in a community, to develop skills, to feel useful, to realise oneself and to gain social recognition. The last aspect of social recognition in particular acts as a driver of further growth, as it seems to be human nature that one’s own well-being does not necessarily depend on the absolute level of prosperity, but very much on the relative comparison with others, i.e. one’s own socio-economic status (cf. Kogelmann 2022, p.489).

In fact, the pursuit of differentiation through social status has an evolutionary and neuronal basis (see Koski et al. 2015), so it seems implausible that the pursuit of social differentiation through the achievement of relatively higher prosperity should simply disappear for a large part of humanity just because a certain level of prosperity has been reached.  Or as the economist Benjamin Friedman observes: “The desire to get ahead compared to other people, just like the desire to advance beyond one’s own prior experience, creates a motivation for economic effort that persists no matter how high living standards rise.” (Friedman 2006 p.87)

In fact, Kogelmann’s defence contains the core of the first arguments that are independent of prosperity, which he himself overlooked and which are developed in the following sections.

5.2 Maintaining subjective well-being

Should we pursue consistent growth to become happier? In fact, there is a strong positive correlation between a country’s GDP per capita and self-reported satisfaction with one’s life. People in wealthier countries report being happier and more satisfied on average (see Ortiz-Ospina & Roser 2017). However, there is disagreement in the specialist literature as to whether a higher level of prosperity can actually make people happier from a certain point onwards.

The so-called Easterlin paradox, which goes back to empirical studies by economist Richard Easterlin, is particularly influential in the discourse. According to these studies, US Americans did not become happier on average between 1946 and 1970, despite an enormous increase in prosperity (see Easterlin 1974, p. 90) – from which it is often concluded that from a certain point of prosperity, at which all basic needs are met, more prosperity no longer leads to more happiness. However, more recent studies, such as the particularly well-received one by Stevenson and Wolfers, find in part “no evidence that countries become satiated – the positive income-happiness relationship holds for both developed and developing nations.” (cf. Stevenson & Wolfers 2008, p. 9)

One possible explanation for why in some empirical studies – such as Easterlin’s – self-reported satisfaction in wealthier countries seems to stagnate after a certain point is that the questionnaires they use do not measure actual satisfaction, but simply self-reported satisfaction as communicated to the outside world. However, how people talk about their own lives seems to depend heavily on linguistic conventions and framing effects. These also seem to adapt over time as people develop new expectations of how happy they can be. Accordingly, a constant level of self-reported life satisfaction may actually imply an increase in real life satisfaction, as improvements in quality of life lead to the terms used to communicate satisfaction and happiness taking on more ambitious meanings as reference points shift (cf. Cowen 2018, pp.43-44).

However, it seems plausible to assume that people’s capacity for happiness and satisfaction is not unlimited. Even if the level of prosperity in no country in the world today is probably already so high that no further increases in subjective well-being would be possible through growth, a saturation point will probably be reached at some point. So even if the Easterlin paradox is probably not yet true, it will probably become true sooner or later (cf. Moller 2011, p. 182).

Stationary-state arguments often assume, especially in utilitarian forms such as Mill’s but also Keynes’ (see Keynes 2010, p.327), that once we have reached this saturation point of happiness, we would have no reason to pursue further growth, or even that pursuing further growth would prevent us from becoming happier.

However, this assumption overlooks two relevant objections:

1) Subjective happiness is not the only relevant factor that makes a life good.

A good and desirable life encompasses more than just subjective well-being or happiness, but many other values. A classic thought experiment that illustrates this is that of Robert Nozick’s Experience Machine (see Nozick & Nagel 2013, p. 43). But even in classical philosophy, for example, the Aristotelian concept of the good life as eudaimonia encompasses much more than just subjective well-being or hedonistic happiness (cf. Rapp & Corcilius 2021, p.147). These various concepts and values that make up a good life can be better realised with an increasing level of prosperity, as “Wealthier societies offer greater opportunities and freedoms to pursue preferred concepts of happiness, even if this privilege does not always show up in the measurement of [self-reported happiness]” (cf. Cowen 2018, p.45).

Furthermore, there is a tendency for people to resign themselves to certain conditions after a while and to be subjectively just as happy as if they did not exist, as illustrated by the disability paradox, for example. According to this paradox, many people who suffer severe disabilities as a result of accidents often report being just as happy as they were before the accidents. Even if in this case the subjective happiness between the state before and after the accident should be identical and not just a linguistic adaptation, the quality of life seems to be objectively better and more desirable regardless of the subjective satisfaction before the accident, as the person had a higher level of well-being in the form of, for example, greater freedom, higher life expectancy and less pain (cf. Moller 2011, p. 189).

For these reasons, and because subjective well-being is difficult to measure empirically, the philosopher Dan Moller suggests focussing on objective, externally measurable values for people’s well-being with regard to discussions about the possibilities of economic growth to improve our lives. He lists life expectancy, health, the well-being of loved ones and goods that contribute to self-realisation as examples of these values (cf. Moller 2011, p. 187). This argument will be developed in more detail in the next section 5.3.

2) Growth may no longer increase subjective well-being above a certain level of prosperity, but it does help to maintain it.

Kogelmann writes that “for the happiness argument to be wealth insensitive, it must be true that increased wealth always results in greater happiness” (cf. Kogelmann 2022, p.481), something that seems implausible, at least in the long term, as described. Growth can presumably not contribute endlessly to an increase in subjective well-being, but there is nevertheless a reason why we should strive for constant growth in terms of happiness. There is a possibility for a prosperity-independent argument in favour of continuous growth that Kogelmann has overlooked, namely that continuous growth contributes to maintaining a high level of subjective well-being – and this seems to be the case.

After certain basic needs have been met, people’s subjective well-being seems to increase primarily due to relative improvements in their living conditions and is maintained from a certain point onwards. This is also an explanation for the stagnating satisfaction in the Easterlin paradox, but also the frequent return to a baseline of satisfaction that describes the disability paradox: After a certain period of time, people get used to what they have or are, and the satisfaction they derive from the status quo decreases (cf. Friedman 2006, p. 82). Whether people perceive themselves as happy and are satisfied with their lives then depends heavily on how they evaluate their circumstances in relative comparison. Whereby “[…] the most obvious benchmark people have in mind when they draw such comparisons is their own past experience. People who live better now than they did before, or better than they recall their parents living, are likely to think they are doing well. Those who look back on better times-better for them and their families, that is-think they are not. As a result, psychological studies have repeatedly confirmed that people’s satisfaction depends less on the level of their income than on how it is changing” (cf. Friedman 2006, p. 82) .

If people have the impression that they are relatively worse off than at an earlier point in their lives, their life satisfaction generally decreases, even if they have a very high standard of living. This is why depression and dissatisfaction increase sharply during recessions, for example, even in prosperous countries (see Cheves et al. 2018, p. 982), even if these recessions do not lower the level of prosperity below the point previously identified as the saturation point for satisfaction by the Easterlin studies, for example. The situation is similar with economic stagnation: “once growth stops-no matter how high people’s incomes have risen-it is only a question of time before habits adapt and the sense of heightened well-being dissipates. Not only does a better standard of living come to seem familiar and customary, so too do changes like improved working conditions, fewer hours on the job, and superior medical treatment. Only if growth and change persist will people continue to feel better off.”  (Friedman 2006, p.83).

So if the highest possible subjective well-being in the form of happiness and satisfaction is normatively desirable, this is most likely to be increased and maintained in a constantly growing world. A stationary state would lead to dissatisfaction and frustration in the long term due to the stagnation that prevails in it.

5.3 Objective improvements to life

When John Stuart Mill wrote in 1848 that there was now enough wealth in the advanced nations of his time and that all that mattered was the right distribution, GDP per capita in Western Europe was around $2,500. Today, even in the poorest region of the world, sub-Saharan Africa, it is $3,500 (see Maddison Project Database 2020) – and hardly anyone today would want to claim that people in sub-Saharan Africa are doing well enough economically.

But not only are people in Africa today richer on average than people in Western Europe in John Stuart Mill’s time – statistically speaking, they and the entire world population are much better off on several objective levels. For example, life expectancy in Europe in the 1850s was only around 36 years – whereas in Africa as a whole, life expectancy today is around 62 years, and in Europe 77 years (see Roser et al. 2022).

More growth leads to a higher level of prosperity, which empirically has always been accompanied in human history by objective improvements in the quality of life, such as increasing life expectancy, better nutrition and health, better access to goods such as education, leisure and travel as well as more opportunities for individual self-realisation (cf. Moller 2011, p. 187). Although this is a prosperity-dependent argument in favour of growth, it deserves closer examination.

This example using Mill not only illustrates once again the difficulties of assessing growth potential, but also raises several questions. Firstly, what actually constitutes a sufficiently high level of prosperity from which mankind should be satisfied with a stationary state. Mill seemed to assume that the general prosperity in the Western European states of his time would be sufficient for a good life if only it were fairly distributed. However, a world with the level of prosperity of the 1850s, even if it were distributed in an absolutely egalitarian way, probably seems like a dystopia to most people living in the 21st century on closer inspection. The economic productivity per capita at that time was not even sufficient to ensure a balanced diet, and it did not have the production capacity to provide medical goods that are considered essential today, such as antibiotics and vaccinations.

The SARS-CoV-2 pandemic illustrates this very well as an example: after the first infections occurred in December 2019, it took just one year for the first millions of people to be vaccinated and for large-scale vaccination campaigns to begin in several countries (see CDC 2023). A global economy with significantly lower productivity at the level of Mill’s time would not have been able to raise resources for such rapid development, production and distribution of vaccines and to contain the pandemic. In 2020 alone, governments worldwide spent around $720 billion on fighting the pandemic (see WHO 2022, p. 7) – and even if the equally immense private investments are not included, this already amounts to around 50% of global GDP in 1850, but not even 0.63% of global GDP in 2018 (Maddison Project Database 2020). In total, it is estimated that 14.4 million lives were saved worldwide in the first year of the vaccination campaign (see Watson et al. 2022). The fact that the global economy today is capable of such an achievement, which has saved and prolonged the lives of millions of people, is an objective improvement on the 1850s. Such an achievement would not have been possible just a few decades ago, and even if, as the Easterlin studies suggest, subjective well-being in the form of happiness should not be higher today than it was a few decades ago, today’s level of prosperity has nevertheless contributed to people being objectively better off and being able to enjoy this happiness longer and more carefree thanks to better healthcare.

It can be assumed that John Mill could not even imagine the productivity of our current global economy and thus its ability to tackle such global crises as pandemics – he did not even consider today’s level of prosperity possible based on the first idea of the stationary state paradigm, and was generally sceptical about the possibility of technology and prosperity improving people’s lives at all (cf. Mill 2004, p.595).

This is also one of the mechanisms by which the first and second ideas of the paradigm are linked: Pessimism about the possibilities of greater prosperity to improve life leads to rejecting more growth, and instead looking at how a better world could be created from the status quo through more egalitarian distribution.

Because Mill did not believe that a world as prosperous as ours was possible, he did not consider it normatively desirable to strive for it. However, it is quite evident that the continued growth of the last 170 years since Mill’s time has contributed more to the objective improvement of people’s quality of life worldwide than any egalitarian distribution of Mill’s status quo could have achieved. The same can be said of John Rawls: the massive global economic growth since the 1970s has done more to alleviate the suffering of the poorest and weakest in the world than the redistribution of the status quo favoured by Rawls in his time could ever have achieved.

If a stationary state is to be normatively desirable, then it seems obvious that humanity should only strive for it when it has exhausted the maximum normatively desirable objective improvements in the quality of life through the increase in further prosperity and further growth could actually no longer contribute to an objective improvement in the quality of life. But when will this point be reached – does it even exist?

The answer is twofold:

Firstly, we cannot really know, but we have good reason to believe that further increases in productivity would enable further objective increases in the quality of life. Just as Mill could not have imagined the possibilities of our global economy, which is around 80 times larger (see Maddison Project Database 2020), we probably cannot imagine the possibilities of a global economy that is many times more productive than ours today. The epistemic advantage we have over Mill today is that, unlike him, we can empirically look back not just on three decades of significant growth, but on two centuries (cf. Aghion 2023, p.21).  This experience shows that, as philosopher Dan Moller, among others, argues, people have a natural tendency towards a status quo bias, from which the current level of development appears normal and not in need of further improvement, which means that we systematically underestimate the achievability and possibilities of a more prosperous world (cf. Moller 2011, p.188).

Based on this, we can try to avoid the status quo bias, extrapolate and surmise that a lot is still possible. For example, it is possible that further increases in productivity and innovations in the healthcare sector, and especially in genetic engineering, could enable people in a more advanced economy than the one we have today to extend their life expectancy to centuries or cure diseases such as cancer virtually at the touch of a button. This may seem like a miracle, but our economic and technological capabilities are already achieving things that can seem like miracles from a historical perspective. In 1836, for example, Nathan Rothschild, probably the richest man in the world at the time, died of a common infection, which today can usually be easily cured by antibiotics, even in the poorest of people (cf. Friedmann 2006, p.23). Today’s luxury goods that make life more interesting, such as owning a yacht or travelling into space, could one day become as generally accessible as earlier luxury goods are generally accessible today. For example, in the 18th and 19th centuries, toilets were still a luxury good that was unaffordable for most people – during the reign of the Sun King Louis XIV, there was exactly one in the entire palace of Versailles with its 2,000 rooms (see FAZ 2017) – today, a toilet can be found in every flat in most cities.

But ultimately these are only speculations – whether objective increases in the quality of life in most areas would be made possible by further growth or whether an insurmountable plateau will occur at some point, we can only know definitively when they have actually occurred. However, from the experience of the past two centuries, it seems morally imperative to strive for further growth, as this has empirically proven to be the most effective method of increasing the objective quality of life of most people.

Secondly, there is at least one area in which there cannot actually be a plausible sufficiency of available economic productivity and thus a sufficiently high level of prosperity, namely in the capacity to combat existential risks.

5.4 Reduction of existential risks

As the example of the SARS-Cov-2 pandemic illustrates, a higher level of prosperity enables a society to respond better to crises, as it has a greater economic surplus that it can allocate to prevention or response without having to sacrifice vital goods elsewhere. Whether it is forest fires, famine, poverty, floods or disease outbreaks, a society with a more prosperous economy generally has more resources and capacity to respond and help those affected. It is hard to imagine a normative saturation point of economic prosperity from which it would not be desirable to be able to respond even more extensively and quickly to crises and reduce suffering, given all the various afflictions that plague humanity even in the wealthiest countries. For one type of crisis, however, it is not even plausible – namely the prevention of existential catastrophes.

65 million years ago, a 10 kilometre asteroid hit the earth and wiped out around 80% of all species living on earth (see Alvarez et al. 1980) – including the dinosaurs, who made the mistake of not building a global economy that invested a few per thousand of its output in space programmes. If such an asteroid had flown towards the earth a hundred years ago, nobody would be reading this bachelor’s thesis today, for better or worse, because humanity would have followed the dinosaurs into non-existence. However, if today such an asteroid, even with twice or three times the mass, were on a collision course with the Earth, humanity now actually has the ability to use nuclear weapons to divert the asteroid from its course if detected in time, or at least to break it up to such an extent that the impact would not end in our extinction (cf. Lubin & Cohen 2022, p.16). The probability that such an asteroid will fly on a collision course with the Earth in the next hundred years is a low 1 in 1.5 million, and is one of the few major existential risks for which sufficient prevention is actually being carried out (cf. Ord 2021, p.69).

However, we are currently defenceless against other existential risks. A gamma-ray burst or a supernova, for example, could virtually sterilise the surface of the earth in one fell swoop – the former probably happened 440 million years ago and led to the extinction of 85% of all species existing at that time (cf. Melott et al. 2004, p.19). A supervolcanic eruption, such as the Toba catastrophe 74,000 years ago, which almost wiped out humanity at the time, occurs around once every 80,000 years – and would probably not completely wipe out humanity today, but would kill billions and lead to the collapse of civilisation (cf. Ord 2021, p. 74).

The fact that humanity is the only civilisation known to us in our 13.8 billion year old universe suggests that the emergence and survival of intelligent life forms like us is something extremely fragile and rare. Existential catastrophes seem to act as major filters that generally prevent this (cf. Hanson 1998). Humanity and life on earth in general have been very lucky so far not to have been wiped out by an existential catastrophe. However, luck will not ensure the long-term survival of humanity. Accordingly, we have a moral responsibility to increase the probability of this survival, because on the one hand, if all moral agents are dead, moral actions are no longer possible (cf. Ord 2021, p.55). Secondly, premature extinction would mean a loss of billions and billions of actual and potential human lives. Therefore, protection against existential risks or the achievement of a state of existential security should be a top priority in politics and philosophy, as philosopher Toby Ord, among others, argues (cf. Ord 2021, p.6).

The higher the level of prosperity of our civilisation, the greater the surplus of economic output that it can invest in preventing and coping with existential catastrophes. A civilisation that grows constantly increases its long-term chances of survival and its overall life expectancy as it grows – while a civilisation that stagnates in a stationary state is inevitably confronted with what is likely to be a much earlier extinction.

It seems implausible that a saturation point will ever be reached at which a civilisation actually has the resources to defend itself against all possible existential catastrophes – because there are several types of potential existential catastrophes such as massive stellar explosions, collisions of galaxies, a vacuum decay or certain forms of unaligned AGI, where even a spread to several solar systems would not be sufficient for survival (cf. Ord 2021, p. 184).

If there is such a thing as a normatively desirable stationary state in terms of maximum achievable and attained existential security, then it is probably at a level of prosperity at which humanity has spread to several galaxies or even universes – which is probably not possible. But every step towards this point means an increase in the life expectancy of our civilisation and an exponential increase in future human lives. Nick Bostrom, for example, estimates that every second of delay in the colonisation of our local supercluster leads to around 1013 to 1029 fewer future human lives (cf. Bostrom 2003, p.4).

However, one problem that arises from economic growth with regard to existential risks is that it can also generate new anthropogenic existential risks in the medium term, such as the possibility of nuclear wars or the uncontrolled profiling of biological weapons. This aspect will be addressed again in the discussion section in Section 6 when it comes to including this aspect in the determination of an appropriate growth rate.

5.5 Non-zero-sum world

Regardless of the existing level of prosperity, constant growth is normatively desirable because only a growing economy is an economic non-zero-sum game in game theory terms. A stagnating economy, on the other hand, is an economic zero-sum game. If an economy stagnates and per capita capital therefore remains constant, a single person can only increase their individual share of total capital if at least one other person loses capital – there are only as many gains as losses (cf. Friedman 2006, p.86).

Mutually beneficial economic cooperation for all actors thus becomes impossible in society as a whole, as aggregated transactions represent a zero-sum game. Not only does a world in which one person’s economic advantage inevitably represents another person’s disadvantage appear more unfair than a growing world in which everyone can benefit from co-operation on the whole – it also leads to negative changes in people’s moral attitudes, as it promotes a zero-sum mindset. Conversely, a constantly growing economy promotes a normatively desirable positive-sum mindset.

This argument was most prominently developed by the economist Benjamin Friedman in his 2005 book The Moral Consequences of Economic Growth. Based on an analysis of historical data from the USA and various European countries, Friedman argues that periods of economic stagnation or decline are accompanied by an increase in intolerance, selfishness, resentment, social regression and an erosion of trust. Conversely, periods of stable economic growth lead to greater openness, tolerance and acceptance of pro-social legislation and democracy (cf. Friedman 2006, p. 2, 86).

The mechanism behind this phenomenon can be understood as follows:

If a society grows sufficiently strongly, it is a positive sum game. An individual A can maintain and improve his own standard of living in it, while other individuals B also improve their standard of living. Costs that A may incur by improving the standard of living of B, such as increased taxes to subsidise education or social welfare, are offset by economic growth and the mutually positive effect of cooperation, or at least are not accompanied by a noticeable deterioration in one’s own position (cf. Friedman 2006, p. 95). The bottom line is that both A and B can be better off at the same time. Such a society provides individual A with incentives for altruistic or at least neutral behaviour towards his fellow human beings B.

If, on the other hand, the economy stagnates or shrinks, any improvement in the prosperity of one individual is inevitably accompanied by a deterioration in the condition of another person. If A is better off, B is worse off, and vice versa (ibid. p. 85). Incentives systematically arise in society to adopt a zero-sum mindset that identifies the welfare and social mobility of others as a threat to one’s own (cf. Różycka-Tran et al. 2015, p. 528).

Since people tend to evaluate their own well-being on the basis of relative benchmarks – e.g. how they are doing economically compared to a previous point in time or their fellow human beings – their well-being depends heavily on whether they feel that their living conditions are improving or deteriorating in relative terms (cf. Friedman 2006, p. 82). In addition, the human psyche has a pronounced tendency towards loss aversion or the possession effect.

Potential and actual losses of things we already have are generally more unpleasant than the prospect of something new due to this loss aversion. Even the risk of suffering a loss motivates our behaviour (cf. Kahnemann 2012, p. 360).  The fear of losing out economically and being relegated therefore acts as a proportionally stronger motivator than the prospect of possibly rising economically. In a stagnating economy, the actual or even potential economic advancement of another person through an egalitarian social policy, for example, tends to be perceived as a threat and as an active disadvantage to oneself and others, while one’s own potential advantages through such a policy are given less weight (cf. Friedman 2006, p. 86).

This manifests itself in an increasing defensive attitude towards egalitarian social policy, but also often, consciously or unconsciously, in discriminatory behaviour such as racism in order to prevent the economic advancement of others or to secure a larger share of capital for oneself (cf. Friedman 2006, p. 86). In addition, the lack of relative improvement and stagnation in one’s own life leads to greater comparisons with fellow human beings and thus to more envy, resentment, decreasing generosity and, in turn, even less tolerance (cf. Friedman 2006, p. 92). Finally, in such an intolerant climate, trust in fellow human beings and political institutions and thus the basis of democracy erodes more easily (cf. ibid.), which is also plausible in terms of game theory, as non-zero-sum interactions are one of the foundations for the long-term development of cooperation and thus trust (cf. Axelrod 2006, p. 42).

Friedman is not the only one to empirically identify such a strong correlation between economic growth and the prevalence of moral attitudes, which makes causality plausible:

For the majority of human history, people lived in agrarian and feudal societies, which usually had hardly any noticeable economic growth and were therefore mostly zero-sum economies. These societies were often characterised by the prevalence of two characteristics, the second of which follows from the first:

  • Zero-sum thinking: The general conviction that social relationships are antagonistic and that one’s own success is only possible at the expense of others (cf. Foster 1965, p.67; Różycka-Tran et al. 2015, p. 528).
  • Extractive institutions. Exploitation of other people in the form of wars of conquest and slavery, discrimination based on birth in the form of class and caste systems, and the associated authoritarianism (cf. Wright 2001, p. 135; cf. Cowen 2018, p.31).

Some evolutionary psychologists and anthropologists attribute the developments away from zero-sum thinking and exploitative institutions in the course of human history towards more and more reciprocal altruism and finally the emergence and spread of liberal democracies to the increase in non-zero-sumness in recent centuries through the implementation of technologies and institutions that promote it (cf. Wright 2001, p.22), the measurable result of which is economic growth. Slavery in particular, which has been practised in most agrarian societies around the world since the Bronze Age (cf. Encyclopedia Britannica 2023), began to decline in the course of history with increasing economic growth and the resulting growth in non-zero-sumness, until it was finally criminalised and began to disappear in more and more states in the course of industrialisation in the 19th century and thus accelerating growth (cf. Wright 2001, pp. 106, 151; Friedman 2006, p.226).

However, the connection between growth and zero-sum thinking and the associated negative behaviours can also be empirically proven at a less historical level. An analysis of psychometric analyses of 37 countries found a positive correlation between the prevalence of zero-sum thinking and low GDP (see Różycka-Tran et al. 2015, p. 537). There is evidence of an increase in xenophobic and racist resentment, for example in European countries in the wake of the recessions caused by the 2008 financial crisis and the subsequent euro crisis (cf. Ghosh 2011, p.188). Friedman himself points to a positive correlation between phases of declining economic growth and the increase in Klu Klux Klan activities and discriminatory legislation in the USA in the 19th and early 20th centuries (cf. Friedman 2006, p. 128, 148 – 153). Davis and Knauss subjected the hypothesis that economic growth promotes support for egalitarian social policy to an empirical analysis with data from 84 countries – and found confirmation for a slightly modified hypothesis that this effect occurs more strongly with increasing growth and in less developed countries (cf. Davis & Knauss 2013).

The rise of right-wing populism in the US since the 2008 financial crisis and the electoral success of Donald Trump in 2016 were also attributed by several economists to stagnation and regression, particularly in the so-called Rust Belt of the US, and the resulting resentment (see Komlos 2018, p.4).

The phenomenon that growth promotes the emergence and maintenance of tolerant attitudes and inclusive institutions such as democracies through the creation of non-zero-sumness is of great importance. These institutions are also among the conditions that current growth theories identify as the drivers of growth (cf. Kogelmann 2022, p. 485; cf. Aghion 2023, p.292). Based on this, various economists, including Friedman, postulate the concept of self-reinforcing feedback loops in the relationship between political institutions and growth. Growth promotes inclusive, democratic institutions, and these in turn promote growth, which leads to a self-reinforcing virtuous circle. Stagnation in turn promotes authoritarian, extractive institutions, which in turn promote stagnation in the long term, leading to vicious circles (cf. Friedman 2006, p. 345). However, it should be emphasised that historically, vicious circles are much more likely and it is much easier for a society to get into a vicious circle than to get out again (cf. Friedman 2006, p.344), which makes it all the more important to prioritise the maintenance of growth politically.

A society that produces as few or no economic “losers” as possible and that is open, tolerant and characterised by high social mobility, inclusive institutions and the absence of resentment and exclusionary attitudes such as racism is normatively desirable. However, such a society is best achieved and maintained if it is an economic non-zero-sum game. For it to be such a game, however, it must constantly grow economically. This means that constant economic growth is normatively desirable regardless of the level of prosperity a society has already achieved.

Contine reading part 6: On the Value of Economic Growth #6 – Restrictions, Implications, Conclusion


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