Each year, our planet's resources continue to be depleted ever more rapidly. At the same time, numerous statistics show growing inequality, despite economic growth. Nevertheless, economic growth is still considered to be the key to greater prosperity. One reason for this is the underlying economic models whose forecasts are typically limited to purely economic indicators, and which have mostly disregarded the development of alternative measures of well-being.
At an expert workshop held in Germany that will be attended by representatives from organizations and institutions including the European commission, the OECD, the Federal Ministry of Economics and Technology (BMWi), adelphi and other research institutes are investigating how alternative indicators for environment and prosperity can be better integrated into economic models and thus also into media coverage and public debates. Our workshop will be preceded by a lecture by Prof. Dr. Tim Jackson titled "Economics as story-telling: the power and limitation of models" on Monday, May 7, 2018.
Tim Jackson has taken the time to already answer some questions in advance. In our interview, he talks about different understandings of prosperity and explains why we should take a more critical view of current economic models.
Most people in Germany know you because they have read your book „Prosperity without growth“. In this book you argue that we need to find a common understanding of prosperity that does not depend on economic growth. What does a prospering society without economic growth look like?
Tim Jackson: What can prosperity possibly mean in a world of environmental and social limits? This question has fascinated me my whole working life. Can our economies really go on growing exponentially for ever? How is this even possible without trashing the planet? And how can we live within our means, while still ensuring that everyone has the chance for a decent life? Prosperity without Growth is my attempt to answer these questions.
It is clear that prosperity transcends material concerns. It resides in the quality of our lives and in the health and happiness of our families. It is present in the strength of our relationships and our trust in the community. It is evidenced by our satisfaction at work and our sense of shared meaning and purpose. It hangs on our potential to participate fully in the life of society. Prosperity consists in our ability to flourish as human beings – within the ecological limits of a finite planet. The economy of tomorrow must start from this understanding.
In your presentation on Monday you are going to talk about how economists can be seen as storytellers. What does this imply for how we should consider the results of economic models? And how can economic models help us to achieve a more sustainable future? What needs to be done for this?
Tim Jackson: To talk about economists as storytellers is not to belittle them or insult them. Stories matter to us. Myths and narratives guide and inform our lives. Without them we are lost. This is as true at the national level as it is at the individual level. Every society clings to a cultural myth by which it lives. Ours is the myth of economic growth. We told ourselves for the last half a century that as long as the Gross Domestic Product was continuing to rise then all would be well. Life for our children would be brighter and shinier. Social progress would be on track.
"We should continually re-examine the myths by which we live."
But this story relies on the assumption that more is always better; and that assumption fails on numerous grounds. More is as often bad for us (or for those around us) as it is better. Too much sugary food sold to our kids has led to a crisis in childhood obesity. Too much carbon in our atmosphere is leading to dangerous anthropogenic climate change. The parallel is not accidental. Both things depend on the story we’ve told ourselves about social progress. Our challenge is to find a different story, to redefine the myth of growth. But even when we’ve found what we think might be a new story, we should never entirely be carried away with it. We should continually re-examine the myths by which we live. Economic models can help us do that. Modelling helps us tell (and test) our stories.
What is the greatest challenge that we face to turn the rudder around and navigate our societies towards a more sustainable future?
Tim Jackson: I think our biggest challenge is to overcome the idea that there is nothing that can be done, that things have to be this way, that there is (as Margaret Thatcher once famously remarked) ‘no alternative’. In Prosperity without Growth I wanted to explode the myth of the ‘insatiable consumer’ and replace it with a more considered, more compassionate view of what it means to be human. I wanted to deconstruct the narrative of a conflicted and powerless government and replace it with a vision of a dynamic and progressive State. I wanted to show that another kind of economy is not just possible, but already being developed all around us.
The 2nd edition articulates more precisely the dimensions of this new economy: the nature of enterprise, the quality of our working lives, the structure of investment and the role of the money supply. I’ve tried to show how these dimensions can be transformed in ways which protect employment, allow for social investment, reduce inequality and deliver both ecological and financial stability. In the process, I’ve come to believe that building the foundations for the economy of tomorrow is a precise, definable, pragmatic and meaningful task.
Tim Jackson's keynote takes place at the Haus des Bevollmächtigten der EKD in Berlin, Charlottenstr. 53 -54, in the large hall ("großer Saal") at 6pm. For further information please click here.