File(s) under permanent embargo

The end of economic growth? A contracting threshold hypothesis

journal contribution
posted on 2010-09-15, 00:00 authored by P Lawn, Matthew ClarkeMatthew Clarke
This paper argues that GDP growth in both developed and developing countries has associated costs that can outweigh the benefits and thus reduce sustainable well-being. This conclusion is based upon the findings of empirical applications of the Genuine Progress Indicator (GPI) to a range of countries in the Asia-Pacific region. The studies conducted on seven Asia-Pacific countries indicate that, in the case of five of the seven nations, more recent GDP growth has reduced the sustainable well-being experienced by the average citizen residing within them. Moreover, the threshold point at which the costs of GDP growth outweigh the benefits appears to be contracting (i.e., occurring at a much lower per capita level of GDP). This paper therefore introduces a new contracting threshold hypothesis: as the economies of the Asia-Pacific region and the world collectively expand in a globalised economic environment, there is a contraction over time in the threshold level of per capita GDP. As a consequence, the threshold point confronting growth late-comers (i.e., developing countries) occurs at a much lower level of sustainable welfare than what wealthy nations currently enjoy. The consequences of this for developing countries are clearly significant and require a new approach to economic development.

History

Journal

Ecological economics

Volume

69

Issue

11

Pagination

2213 - 2223

Publisher

Elsevier BV

Location

Amsterdam, The Netherlands

ISSN

0921-8009

eISSN

1873-6106

Language

eng

Publication classification

C1 Refereed article in a scholarly journal

Copyright notice

2010, Elsevier B. V.