Sustainable Finance and Banking

Appendix XI

Zero Growth and Other Solutions?

A number of economists speak of a growth obsession (or tunnel rationality; Goudzwaard, 1978): economic growth has become a goal in itself. Various research studies which show that wealth in the US, corrected for environmental quality and health among other things, has declined since the 1960s are often points of reference for this (Daly and Cobb, 1989). The drive for growth results in damage to the environment without resulting in extra wealth (this lies behind the plea for a green GNP). For these and other reasons, some economists argue for zero growth¹³ while others even speak of selective contraction (Hoogendijk, 1993).

Daly goes furthest in his proposals (1991). He sees a ‘steady state’ economy ...