The Impact of Economic Growth on our Planet

For a long time, economic growth has been hailed as the foundation of social

progress, propelling technology, global connectedness, and living standards forward. Growth

has been pursued as a path to prosperity, from the industrial revolution to the digital era. But

for this relentless need for growth, the earth has paid a heavy price.

With economic growth, ecosystems are often under greater stress, natural resources

depleted, and the environment degraded. The pursuit of growth raises some fundamental

questions, such as how the planet will be able to meet the demands of a fast-growing

economy. How does one balance the dire need for environmental preservation with the

What is Economic Growth?

Economic growth consists in the augmentation of gross domestic product during a

long period of at least a year. Economic growth mainly came from three factors. The two

main factors of production are the labor factor (number of workers and hours of work) and

the capital factor (machines, premises).The more workers and machines there are, the

more important is the economic growth. However, another factor is really important, the total

factor productivity, which notably takes into account the qualification or the efficiency of the

two previous factors.

Economic growth is also influenced by technical progress. Indeed, in order to be in a

monopoly situation, companies have to innovate as it will allow them to have a patent.

Consequently, a new product will be on the market meaning that the gross domestic product

will increase as well as the economic growth. Moreover, the companies will have more

profits and will be able to invest into research and development which will lead to more

innovation and more economic growth.

The Impact of Economic Growth on the Environment

The depletion of the stock of natural capital is the effect of economic growth. In fact,

economic growth depletes the stock of natural capital, and this erosion casts doubt on the

sustainability of development because future generations will not be able to benefit from at

least as large a stock of natural capital as exists today.

Some of the assets that compose the natural capital stock are not renewable, and

economic activities do use up those resources at a rate that will render them unavailable in

the medium run. Examples are natural gas or oil energy sources. Other natural resources

are renewable, but economic growth is linked to overexploitation, which does not guarantee their regeneration. That would be the case of fishery resources or freshwater resources, which become scarce resources.

Moreover, economic growth is causing more pollution through economic activities

and is therefore deteriorating the quality of the stock of natural capital. There is air pollution;

which could be linked to global warming. However, there are other kinds of pollution that

destroy natural capital: soil pollution coming from plastics, pesticides, nuclear waste, etc.

Pollution is a negative externality.

Negative external effect : harmful consequences of the action of an economic agent in

connection with other economic agents without transaction with said other economic agents,

it means that the first economic actor does not compensate the latter.

Economic growth necessarily is translated into pollution of the natural capital, which

therefore deteriorates the quality of said natural capital for future generations; said economic

growth is therefore definitely unsustainable economic growth.

Finally, economic growth increases the amount of greenhouse gas emissions,

especially carbon dioxide, which in turn increases air pollution and contributes to global

warming. Global warming is a form of climate change characterized by an increase in the

average temperature of the Earth's surface. This is due to the development of industrial

activities, road transport, and power plants. Therefore, economic growth is a direct cause of

global warming. All this environmental damage raises questions about the economic model

and the possibility of sustainable growth. We need to change our patterns of production and

consumption in order to achieve sustainable growth.

Weak Sustainability: Focus on Innovation

Weak sustainability is derived from the fact that natural capital can be supplemented

by human and technological capital. That means, for example, environmental loss can be

substituted by innovation: more resource-efficiently using resources.

Main instruments:

• Clean Technology: Development of renewable energy resources (solar, wind, hydro) and the greening of infrastructure in ways that reduce CO2 outputs.

• Circular Economy: Upgrading Waste into New Resources; reduction of environmental impact.

Carbon pricing includes imposing emissions taxes to incentivize companies to adopt

sustainable practices. However, it has been criticized because it relies on innovation, which

may not be sufficient to offset the occurrence of irreversible environmental damage.

Strong Sustainability: Planetary Boundaries Care

Opposite to the weak sustainability concept, strong sustainability underlines the irrelevance

of natural capital. In other words, it insists that some ecological limits, like biodiversity or air

quality, should be maintained at all costs.

Key poles:

• Protect the ecosystems by establishing nature reserves and completely prohibiting

  development in certain sensitive areas.

• Reduce consumption: to favor sobriety in life, reduction of waste, and responsible

  consumption.

• Environmental justice: advocate policy equity, so that costs and benefits in ecological

  transformation are reasonably distributed.

• This will involve a paradigm shift: from growth economy to balanced economy,

  whereby human activities respect the Earth's capacity for regeneration.

Conclusion:

To conclude, not every time, preservation of the environment and economic

growth are rivals. Strong sustainability supports strictly reducing human impact on

the world, while weak sustainability is reliant on economic advancement and

technical solutions to overcome environmental constraints.

It is for this reason that a hybrid strategy must be adopted in dealing with

innovations while recognizing the limitation of ecosystems. There is no other way to

balance environmental sustainability with economic development and ensure a just

and sustainable future for all except through global and collective action.