Is the End of the World at Hand?
Author(s): ROBERT M. SOLOW
Source: Challenge, Vol. 16, No. 1 (MARCH/APRIL1973), pp. 39-50
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ROBERT M. SOLOW
Is theEnd oftheWorldat Hand?
To growornottogrow:thatneverwasthequestionuntilrecently.
modeldeveloped
Buta computer
byMIT's JayForrester
projects
unlesswecall a halt
imminent
collapsefortheworldeconomy
Solowhas somedoubtswhichhe expressed
now.Professor
togrowth
heldat LehighUniversity.
on theLimitsto Growth
at a Symposium
outhowtobegin successfulin theirpersonalcareers,whetherin
I washavinga hardtimefiguring
oranywhere
else.We shouldalso
whenI came acrossan excerptfroman interview politics,
business,
but
need
radical
withmy MIT colleagueProfessor
philosophers, we shouldtakecare
JayForrester,
out
of thesocialsciences.
or
Dr.
to
Columbus
the
the
whois either Christopher
keep
representatives
ofthisbusiness,
on howyou Such people alwayswantto go to thebottomof
depending
Strangelove
lookat it.Forrester
saidhe wouldliketosee about a particular
problem.Whatwe wantto lookat are
causedbyinteractions."
themostgiftedand bestqualified theproblems
100individuals,
I don'tknowwhatyoucall peoplewhobelieve
in a teamto make
in theworld,brought
together
in particular,
a psychosocial
analysisof the problemof world theycan be wrongabouteverything
to
but
be
somehow
to getit
it
would
take
about
ten
He
luckyenough
expect
equilibrium. thought
to
the
on
the
interactions.
be
descendants
When
he
was
asked
define
composition right
Theymay
years.
of his problem-solving
Lapidus,whosaid he lost
group, Forrestersaid: ofthefamousmerchant
madeup ofpro- moneyon everyitemhe sold,butmade it up on
be mostly
"Aboveall itshouldn't
One wouldincludepeoplewho had been thevolume.Well,I supposethatas an economist
fessors.
Robiri M. Solow is Professorof Economicsat MIT. His paper,along with
willappear in The EconomicGrowth
otherspresentedat LehighUniversity,
to be publishedthisspringby International
Arts& Sciences Press,Inc.
Controversy,
March-April1973/Challenge 39
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canoe freak.That may even be a
of thesocial sciences;and meditating
I am a representative
true
statistical
I'm preparedto playouttherolebytalkingabout
association,but I will argue that
between
orlogicalconnection
to saywhattheGrowth thereis no necessary
first
and trying
principles
and
businessis reallyall about.This youranswerto thegrowth
vs. No-Growth
youranquestion
is goingto involveme in theold academicploy swerto thequality-of-life
question.Supposethere
ofsayingoverand overagainwhatI'm nottalking wereno issueabouteconomicgrowth;
supposeit
aboutbeforeI everactuallysaywhatI thinkI am wereimpossible;
supposeeachmanoreachwoman
to
of
those
were
I'm
that
some
But
afraid
about.
equipped have only two children(one
talking
undereach wing);supposewe werestuck
have
bomb
of
the
are part
priceyou
boringdistinctions
we havenowand had no conwiththetechnology
itright.
topayforgetting
or evenofincreasedmechanizaFirstofall,thereare(at least)twoseparateques- ceptofinvention,
We could still
foreconomic tion throughcapital investment.
tionsyoucanaskabouttheprospects
Or
Is
desirable?
You
can
ask:
merits
of
you argueaboutthe relative
growth
cuttingtimber
growth.
housesorleavingitstandtobe enjoyed
can ask: Is growth
possible?I supposethatifcon- forbuilding
is notpossible,it hardly as forest.Some people would stillbe willingto
tinuedeconomicgrowth
whether
or not it's desirable.But if it is breathecarbonmonoxidein big citiesin return
matters
so we can fortheexcitement
would
notinevitable,
ofurbanlife,whileothers
possible,it'spresumably
cleanerair and fewerTV channels.Macy's
we shouldwantit. But theyare prefer
discusswhether
to
one
of
them
stillnot tell Gimbel's.Admenwouldstill
an
answer
would
and
separatequestions,
womenare
an answerto theother.Mymain tryto tellyou thatall thosebeautiful
is notnecessarily
smokes
who
for
businessis withthequestionaboutthepossibility actuallyjust looking somebody
toinsultbothmenand
thusmanaging
I wantto discussthevalidity Winchesters,
ofcontinued
growth;
of thenegativeanswergivenby the "Doomsday womenat once. Some people would still bring
radiosto thebeach.All or nearlyall of
Models" associatedwiththe namesof Forrester transistor
aboutthequalityof lifewouldbe
and Meadows(and MIT!) and,to a lesserextent, thearguments
neverarose.
whopublished justas validifthequestionofgrowth
withthegroupofEnglishscientists
I won'tgo so faras tosaythereis no connection.
called "BlueprintforSurvival."The
a manifesto
one can argue thatif population
mainconcernof Dr. E. J. Mishan[whosearticle In particular,
will appearin a laterissue],on the otherhand, densitywerelow enough,peoplewouldinterfere
couldfind
was withthe desirability
of continuedeconomic muchlesswitheachother,andeveryone
that
of
civilization
at
least
with
the
desirthe
world
and
of
a
(and,
style
byimplication,
growth
part
the
about
of
him.
Then
differences
suited
of
economic
If
I
a
few
opinion
ability past
growth). spend
it is mainlybe- qualityof lifewouldn'tmatterso much.Even if
minutes
poachingon histerritory,
it is stillthe
cause thatseems like a good way to get some I grantthetruthof thatobservation,
on
here
from
case
but
also
to
a
discussion
out,
that,
questionsaboutthe
concepts
straight,
just keep
from
of
life
are
questionsabout
separable
quality
going.
Ifgrowth
ofgrowth.
thedesirability
stopped,there
wouldbe just aboutas muchto complainabout;
Sortingouttheissues
and, as I shall arguelateron, one can imagine
thatis directed
of
economic
the
about
continued
againstpollution,
desirability
growth
Arguments
about
the
into
oftenturnquickly arguments
againstslicedwhitebread.
againstcongestion,
growth
I supposeit is onlyfairto admitthatifyouget
"quality"ofmodernlife.One getsthenotionthat
of
whose
if
the
sort
abouteconomicgrowth
are
favor
you are
person
you
veryenthusiastic
growth you
and
idea ofheavenis todriveat 90 milesan hourdown likelyto be attractedto easilyquantifiable
of
to
as
measurable
a six-lanehighway
in
order
to
things objects study, pointat
readingbillboards,
pollutetheair oversomecrowdedlake withthe withprideor to viewwithalarm.You are likely
and topaylessattention
toimportant,
exhaustfromtwin100-horsepower
outboards,
aspects
intangible
whoseidea offoodis Cocoa Krispies.On theother ofthestandard
ofliving.Although
youcan'tknow
hand,to be againsteconomicgrowthis to be a whether
peopleare happierthantheyused to be,
thattheydrinkmore
granola-eating,backpacking, transcendental-you can at leastdetermine
40
M arch-April1973
Challenge/
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orangejuice or takemoreaspirin.Butthat'smere
to do in
and has nothing
weaknessofimagination
of
economic
with
the
desirability
growth,
principle
letalonewithitspossibility.
thatis often
Thereis another
practical
argument
it sometimes
made; and althoughit is important,
servesas a wayof avoidingcomingto gripswith
thereal issues.This argument
saysthateconomic
outputper person,is theonly
increasing
growth,
we
are
likelyto achievea more equitable
way
of
distribution incomein society.There is a lot
less likely
of hometruthin that.It is inevitably
electoratewill vote to redisthata middle-class
tributepartof its own incometo the poor than
thatit will be willingto allocatea slightly
larger
scalewiththepoor
theirwealthon anysubstantial
Even if theywere,thereare so many
countries.
morepoor people in the worldthatan equally
sharedincomewouldbe quitelow.The onlyprospectof a decentlifeforAsia, Africa,and Latin
Americais in moretotaloutput.
But I pointthisout onlyto warnyou thatit is
not the heartof the question.I thinkthatthose
who oppose continuedgrowthshouldin honesty
of theirpositionfor
face up to the implications
distributionalequityand the prospectsof the
world'spoor. I thinkthosewho favorcontinued
growthon the groundsthatonly thus can we
achievesome real equalityoughtto be serious
withequalityis a
aboutthat.If economicgrowth
itdoesn'tfollowthateconomicgrowth
goodthing,
witha lot of pious talkabout equalityis a good
we can have growthwithor
thing.In principle,
with
withoutequity;and we can have stagnation
aboutfirst
or without
princiequity.An argument
those
should
thingsseparate.
keep
ples
Whathasposterity
donefor us?
Well,then,whatis theproblemofeconomicgrowth
all about?(I'm givinga definition
now,notstating
a fact,so all I can say is thatI thinkthiswayof
lookingat it contributesto clarityof thought.)
total.Evenmorepessimistically,Wheneverthereis a questionabout whatto do,
shareofa growing
of economicgrowthturnson the
thatevena givenrelativedistribu- the desirability
I mightsuggest
itcannotbe mademore claims of the futureagainstthe claims of the
tionofincome,supposing
is someonewho is
nearlyequal, forpoliticalor otherreasons,is less present.The pro-growth-man
usefuland desirif the absolutestandardof livingat preparedto sacrifice
unattractive
something
thebottomis fairlyhighthanit is if theabsolute able rightnowso thatpeopleshouldbe betteroff
is someonewho
theanti-growth-man
is verylow.Fromthispoint in thefuture;
at thebottom
standard
The naor
undesirable.
is
of view,evenif economicgrowthdoesn'tlead to thinksthat unnecessary
forfuture
ofpresent
it makestheinequity tureofthesacrifice
moreequityin distribution,
enjoyment
The classic
we'vegotmoretolerable.I thinkit is one of the enjoymentcan be almostanything.
We can use ourlaborand
as recentas theMcGoverncam- exampleis investment:
lessonsofhistory
likeroads
to
build
of thepros- ourresources
verydurablethings
paignthatthisis a realisticstatement
or dams
or blastfurnaces
or subwaysor factories
pects.
It is evenclearerifone looks,notat thedistribu- thatwill be used fora longtimeby peoplewho
werecreated,
liketheU.S., werenotevenbornwhenthosethings
tionofincomewithina richcountry
contributed
have
will
ofincomebetweenthede- and so
butat thedistribution
nothingto
certainly
Thatlaborand thoseresources
oftheworldandtheundeveloped theirconstruction.
velopedcountries
ones.The richWesternnationshave neverbeen can just as well be used to produceshorter-run
as much pleasuresforus now.
ofallocating
abletoagreeon theprinciple
onbehalf
ofcurrent
Sucha sacrifice
as one percentof theirGNP to aid undeveloped
consumption
to be willingto share of the futuremay not strikeyou as muchof a
countries.
Theyare unlikely
March-April1973 /Challenge 41
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But that'sbecauseyou live in a country something
sacrifice.
terrible
happens,therewillbe a lotmore
thatis alreadyrich;if you had lived in Stalin's futurethantherehas been past; and, forbetter
wouldbe one of the orworse-probably
worse-therewillbe morepeoRussia,thatneed to sacrifice
reasonsyouwouldhavebeengiventoexplainwhy ple at each futureinstantthanthereare now or
comfort
andpleasures
while have been. So all in all, the futurewill involve
youhadtolivewithout
of HeavyIndustry
the Ministry
all
the
of lifethanthepresentor
got
play. manymoreman-years
If you lived in an underdeveloped
countrynow thepast,anda kindofintergenerational
democracy
would
the
face
same
What
shall
that
all
those
deserve
you
problem:
you suggests
man-years-to-be
do withthe foreigncurrency
earnedby sales of someconsideration
outofsheernumbers.
On theotherhand,//continued
cocoa or copperor crudeoil- spendit on imports
economicgrowth
ofconsumer
now, is possible-whichis thequestionI'm comingtogoodsforthosealiveandworking
or spenditon imports
ofmachinery
will be richer
tostartbuild- thenit is verylikelythatposterity
an
than
we
if
that
to
are
even
we
make
no
raise
the
standard
ing industry mayhelp
special efforts
in
ofliving 30 years'time?
on itsbehalf.If history
offers
anyguide,then,in
Thereare otherwaysin whichthesamechoice thedevelopedpartof theworldat least,the accan be made,including,
forinstance,
thedirection cumulation
oftechnological
willprobaknowledge
ofintellectual
resources
to theinvention
of things blymakeour great-grandchildren
betteroffthan
of electricity
fromnuclearfu- we are, even if we make no greateffort
in that
(likethegeneration
Paradoxfuture
direction.
aside
the
of
sion)thatwillbenefit
generations.
Leaving
possibility greater
ically,one of thewaysin whichthe presentcan equality-I have alreadydiscussedthat-thereis
do something
forthefuture
is to conservenatural hardlya crying
needforposterity
to be on average
If we get alongwithless lumbernow verymuchricherthanwe are.Whyshouldwe poor
resources.
so thattherewillbe moreforests
forour folkmakeanysacrifices
forthosewhowillin any
standing
or
if
we
limit
the
in
case
live
in
the
Of course,ifthe
future?
grandchildren,
present
luxury
consumption of oil or zinc so thattherewill be some endoftheworldis at hand,ifcontinued
economic
is
not
leftforthe twenty-first
then
or
if
we
we
to
care
more
possible,
century,
worry growth
ought
becausetheywon'tbe so welloff.
aboutsiltation
behinddamsthatwouldotherwise aboutposterity,
and water-skiers,
be funforfishermen
in all those Paradoxically,
ifcontinued
is notpossible,
growth
cases we are promoting
economicgrowth.I call orlesspossible,thenwe probably
oughttodo more
it.Actually,
there'sno paradoxin that,
that paradoxicalbecause I thinkmost people topromote
ofeconomics
willrealize,because
theconservation
freakwiththeanti-growth as everystudent
identify
in
this
it
is
view
of
the
a
of
matter,the
way sayingthatthe marginalreturnon
partywhereas,
is tradingpresentsatisfaction
conservationist
for investment
is high.
future
thatis,he is promoting
economsatisfaction,
I think
theconfusion
ic growth.
comesfrommixing
Overshoot,
collapse,doom
problemwiththe growth
up the quality-of-life
a confusion.
Thereis, as you know,a schoolof thoughtthat
problem.Butitis nonetheless
should
we
be
concerned
with
the
welfare
claimsthatcontinuedeconomicgrowthis in fact
Why
ofposterity,
not
or at leastnotforverylong.
the
indubitable
fact
that
possibleanymore,
given
posterity
has neverdone a thingforus? I am not anthro- This judgmenthas been expressedmoreor less
in recentyears.What
pologistenoughto knowhow rareor commonit casuallybyseveralobservers
the"DoomsdayModels"fromtheir
is thatourcultureshouldteachus tocarenotonly distinguishes
is thattheyclaimto muchmorethan
aboutour childrenbut abouttheirchildren,
and predecessors
theirchildren.
I supposetherearegoodDarwinian a casualjudgment:theydeducetheirbeliefsabout
reasonswhycultures
without
frommathematical
future
modelsor sysanyfuture-orientation
prospects
shouldfailto surviveverylongin the courseof temsanalysis.Theydon'tmerelysaythattheend
thattheyhad a merry
time of theworldis at hand-theycan showyou com(Butremember
history.
of it whiletheylasted!)Moreover,
we now enjoy puteroutputthatsaysthesamething.
theinvestments
made by our ancestors,
so there
the Doomsday Models do
Characteristically,
is a kindof equityin passingit on. Also,unless morethanjustsaythatcontinued
economicgrowth
42
Challenge/
March-April1973
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is impossible.
Theytellus why:in brief,because
the
earth's
willsoonbe used
naturalresources
(a)
will soon
up; (b) increasedindustrial
production
us
in
and
(c)
strangle
pollution;
increasing
populationwilleventually
outruntheworld'scapacityto
result.
growfood,so thatfaminemusteventually
the modelstellus one morething:
And,finally,
theworldwill end witha bang,not a whimper.
The naturalevolution
oftheworldeconomyis not
at all towardsome kindof smoothapproachto
itsnaturallimits,wherever
theyare. Instead,it is
inevitableunlesswe makedrasticchangesin the
thattheworld
waywe liveandorganizeourselveswillovershoot
and producanylevelofpopulation
tionit can possiblysustainand willthencollapse,
probably
bythemiddleofthenextcentury.
I wouldliketosaywhyI thinkthattheDoomsbad
day Models are bad scienceand therefore
will
I
to
conguides publicpolicy. hope nobody
clude thatI believethe problemsof population
environmental
and resource
control,
degradation,
to be unimportant,
or thatI am one
exhaustion
of thosepeoplewho believethatan adequatereis a vagueconfidence
that
sponsetosuchproblems
sometechnological
solutionwill turnup. On the
it
is
becausetheseareimportant
contrary, precisely
that
problems
publicpolicyhad betterbe based
on soundand carefulanalysis.I wantto explain
someof myreasonsforbelievingthattheglobal
modelsdon't provideeven the beginnings
of a
foundation
ofthatkind.
The first
thingtorealizeis thatthecharacteristic
conclusionof theDoomsdayModelsis verynear
Itis,infact,morenearlyan assumption
thesurface.
in thesensethatthechainof
thana conclusion,
totheconclusion
is very
logicfromtheassumptions
shortand rather
obvious.
The basicassumption
is thatstocksofthings
like
theworld'snatural
resources
andthewaste-disposal
are finite,thatthe
capacityof the environment
worldeconomytendsto consumethestockat an
rate(through
themining
ofminerals
and
increasing
the production
of goods),and thatthereare no
built-inmechanismsby whichapproachingexhaustiontendsto turnoffconsumption
gradually
andin advance.You hardlyneeda giantcomputer
withthosebehaviorrules
to tellyouthata system
is goingto bounceoffits ceilingand collapseto
a low level.Then,in case anyoneis inclinedto
relaxintotheoptimistic
beliefthatmaybethings
f OECD
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aren'tthatbad,we aretold:Imaginethatthestock
wereactuallytwiceas big as
of naturalresources
or imaginethat
thebestcurrent
evidencesuggests,
theannualamountof pollutioncould be halved
all at onceand thensetto growing
again.All that
wouldhappenis thatthedate of collapsewould
be postponedby Τ years,whereΤ is nota large
number.Butonceyou graspthequitesimpleessenceof themodels,thisshouldcome as no surtorealizewherethesepowerful
prise.Itisimportant
conclusions
comefrom,
because,ifyouaskyourself
I
didn't
realize
earlier
thatthe end of the
"Why
worldwas at hand?"the answeris not thatyou
weren'tcleverenoughto figure
itoutforyourself.
The answeris thattheimminent
end oftheworld
is an immediatedeductionfromcertainassumptions,and one mustreallyask if theassumptions
areanygood.
It is a commonplacethatif you calculatethe
annualoutputof anyproduction
process,largeor
of
small,and divideit bytheannualemployment
labor,yougeta ratiothatis calledtheproductivity
oflabor.Atthemostaggregative
level,forexample,
wecansaythattheGNP in 1971was$1,050billion sources?All the DoomsdayModelswill allow is
and thatabout82 millionpeoplewereemployed a one-time
increasein theworldsuphypothetical
in producing
so
that
GNP
worker
or
the
of
natural
whichis the equivalent
it,
resources,
per
ply
of
a
of
labor
was
about
increaseintheproductivity
ofnatural
$12,800. ofa one-time
productivity year
shouldn't
the
of most
Symmetrically,
thoughtheusageis less common, resources.
Why
productivity
one couldjustas wellcalculatetheGNP perunit naturalresources
risemoreorlesssteadily
through
of someparticular
naturalresourceand call that time,liketheproductivity
oflabor?
the productivity
of coal, or GNP per pound of
Of courseit does forsome resources,
but not
vanadium.We usuallythinkoftheproductivity
of forothers.Real GNP roughlydoubled between
laboras risingmoreor less exponentially,
of primary
say at 1950and 1970.But the consumption
2 or 3 percenta year,becausethatis theway it and scrapironincreasedby about20 percent,
so
has in factbehavedover the past century
or so the productivity
of iron,GNP per ton of iron,
sincethestatistics
beganto be collected.The rate increasedby about 2.5 percenta year on the
of increasein the productivity
of labor is not a averageduringthose20 years.The U.S. consumpconstantof nature.Sometimesit is faster,some- tionof manganeseroseby30 percentin thesame
timesslower.For example,we knowthatlabor period,so theproductivity
of manganesewentup
musthave increasedmoreslowlya by some70 percentin 20 years,a bit under2.25
productivity
backward percenta year.Aggregate
of nickel
longtimeago,becauseifwe extrapolate
consumption
at2 percent
a year,we cometoa muchlowerlabor just aboutdoubled,likeGNP, so theproductivity
in 1492thancan possiblyhave been ofnickeldidn'tchange.U.S. consumption
ofcopproductivity
thecase. And theproductivity
of laborhas risen per,bothprimary
and secondary,
wentup by a
faster
inthepast25yearsthaninthe50yearsbefore thirdbetween1951and 1970,so GNP perpound
that.It alsovariesfromplacetoplace,beingfaster ofcopperroseat 2 percenta yearon theaverage.
inJapanandGermany
andslowerinGreatBritain, The storyon lead and zincis verysimilar,
so their
forreasonsthatare notat all certain.Butit rises, productivity
increasedat some 2 percenta year.
andwe expectittokeeprising.
The productivity
ofbituminous
coal roseat 3 perof naturalre- centa year.
Now,howabouttheproductivity
I
44
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and
thereare important
Naturally,
exceptions,
of
GNP
barrel
oil
was
unimportant
exceptions.
per
aboutthesamein 1970as in 1951:no productivity
of naturalgas
increasethere.The consumption
so
GNP
in
the
same
percubicfoot
period,
tripled
ofnaturalgas fellat about2.5 percenta year.Our
industrial
demandforaluminum
quadrupledintwo
of aluminumfellat
decades,so the productivity
demand
a good3.5 percenta year.And industrial
a
of 25:
factor
forcolumbiumwas multiplied
by
in 1951we managed$2.25millionofGNP (in 1967
whereasin 1970
prices)perpoundofcolumbium,
ofGNP perpound
weweredownto$170thousand
On theotherhand,itis a littlehard
ofcolumbium.
becauseofa shorttoimaginecivilization
toppling
of
columbium.
age
Obviouslymanyfactorscombineto governthe
courseof the productivity
of any givenmineral
overtime.When a rarenaturalresourceis first
available,it acquiresnew uses witha rush;and
thanGNP. That's
goesupmuchfaster
consumption
the columbiumstory,no doubt,and, to a lesser
thevanadiumstory.But once thenovelty
extent,
has wornoff,theproductivity
of a resourcetends
to riseas betteror worsesubstitutes
forit appear,
as new commoditiesreplace old ones, and as
processesimprove.One of the
manufacturing
reasonstheproductivity
ofcopperrisesis because
that of aluminumfalls,as aluminumreplaces
copperin manyuses. The same is trueof coal
and oil. A resource,like petroleum,which is
versatile
becauseof itsroleas a sourceof energy,
is an interesting
special case. It is hardlyany
wonderthatthe productivity
of petroleumhas
the
of energybecause
stagnated,
consumption
bothas electricity
fordomesticand industrial
use
andintheautomobilehasrecently
increasedeven
fasterthanGNP. But no one can doubtthatwe
will runout of oil, thatcoal and nuclearfission
will replaceoil as the majorsourcesof energy.
Itis alreadybecoming
probablethatthehigh-value
use of oil will soon be as feed stockfor the
ratherthanas a source
industries,
petrochemical
of energy.Sooner or later,the productivity
of
oil will riseout of sight,becausethe production
and consumption
of oil will eventuallydwindle
towardzero,butrealGNP willnot.
So therereallyis no reasonwhywe shouldnot
of naturalresourcesas
thinkof the productivity
over time.
moreor less exponentially
increasing
oxfordïfflf
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This collectionof unpublishedreports,memoranda
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and collapseare no longerthe But thepricesystemis, afterall, themainsocial
Butthenovershoot
economies(and,to
evolvedbycapitalist
and the institution
of theworldsystem,
inevitable
trajectory
of the Doomsday an increasing
extent,socialisteconomiestoo) for
typicalassumption-conclusion
There
to relativescarcity.
and reacting
Modelsfallsbythewayside.We are in a different registering
of
the
the
that
several
are
sortofballgame.The system
pricesysworking
ways
mightstillburnitself
outand collapsein finite
time,butone cannotsay tem will push our societyinto fasterand more
of natural
increasesin theproductivity
withany honestythatit must.It all dependson systematic
detailedfactsof moderneconomic resources.
theparticular,
Firstofall,letmegobacktotheanalogybetween
lifeas well as on the economicpolicieswe and
and labor.We are notsurprised
therestoftheworldpursue.I don'twantto argue naturalresources
that
to
learn
I
to
all
want
foranyparticular
quite consciouslytriesto
industry
say
counterstory;
that
save
inventions
make
is
built
nowis thattheovershoot-collapse
labor,i.e., permitthe
pattern
fewerman-hours
with
made
intothemodelsverynearthesurface,
byassump- same productto be
of work.Afterall, on the average,labor costs
at that.
tion,andbyimplausible
assumption
of all costsin our
amountto almostthree-fourths
laborrequirereduces
that
invention
An
economy.
Scarcity-and highprices
mentsper unitof GNP by 1 percentreducesall
Naturalresourcecosts
Thereis at leastone reasonforbelievingthatthe costsbyabout0.75percent.
oftotalGNP, somesmaller
much
a
are
The
is
almost
proportion
certainly
wrong.
Doomsdaystory
andengineering
So
5
mostglaringdefectof the Forrester-Meadows thingnearer percent. industry
motiveto reducelaborremodelsis the absenceof any sortof functioning have a muchstronger
1
is
the
market
that
I
no
believer
am
by percentthanto reduceresource
quirements
pricesystem.
whichmay
of
no
advocate
I
and
am
assumingby 1 percent,
requirements
certainly
alwaysright,
to do one
hard
is
as
it
about
is concerned. or notbe true-that
wheretheenvironment
laissez-faire
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46
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$12.50
in thetechnology
ofextraction,
savas to do theother.Butthen,as theearth'ssupply improvements
naturalresourcesnearsexhaustion, ings in end uses, or the availabilityof cheaper
of particular
becomemoreand more substitutes.
and as naturalresources
The situation
could,ofcourse,change;
to
those
natural
motive
economize
andverylikelysomedayitwill.Iftheexperienced
valuable,the
shouldbecomeas strongas themotive andexpertparticipants
resources
in themarket
nowbelieved
of resources thatresourcepriceswould be sharplyhigherat
to economizelabor.The productivity
shouldrisefasterthannow-it is hardto imagine some foreseeabletime,priceswould alreadybe
otherwise.
rising,as I will tryto explainin a moment.The
mech- historical
that
ofresource
steadiness
Thereareotherwaysinwhichthemarket
pricessuggests
anismcan be expectedto pushus all toeconomize buyersand sellersin the markethave not been
in theabsence
exhaustion
as theybecomescarcer.
resources
onnatural
Higher actingas iftheyforesaw
and therefore
and risingpricesof exhaustibleresourceslead of substitutes,
sharplyhigherfuture
turn
out
to
be wrong;but the
other
materials
substitute
to
prices.They may
producers
competing
no reasonto
us
Models
To
therefore
and
more
thatare
give absolutely
Doomsday
cheaper.
plentiful
claim
to
theextentthatit is impossibleto designaround expectthat-in fact,they
get whatever
forexpensivenaturalresources, meagerempiricalbasis theyhave fromsuch exor findsubstitutes
thatcontaina lotofthem perts.
thepricesofcommodities
sawhigher
willriserelativeto thepricesof othergoodsand
prices
Whyis ittruethatifthemarket
Con- in the future,
servicesthatdon'tuse up a lotof resources.
priceswould alreadybe rising?It
sumerswillbe drivento buyfewerresource-inten-is a rathertechnicalpoint,but I wantto explain
theimportant
sive goods and moreof otherthings.All these it because,in a way,it summarizes
a mineral
to increasetheproduc- thingaboutnaturalresources:
workautomatically
effects
conserving
as building
of naturalresources,
i.e., to reduceresource depositisjustas muchofan investment
tivity
GNP.
that
unit
of
it
has
to
be
and
a
way.Any
analyzed
per
factory,
requirements
a momentago, thisis not an ownerof a mineraldepositownsa valuableasset,
As I mentioned
We may feel thatthe whetherthe owneris a privatecapitalistor the
forlaissez-faire.
argument
The
of an underdeveloped
of
decisions
country.
buyersand sellersgiveinade- government
private
it
if
the
earns
is
worth
at
Or
we
asset
to
future
margin
keepingonly
generations.
quaterepresentation
with a returnequal to thatearnedon otherkindsof
are in conflict
mayfeelthatprivateinterests
of coal is assets.A factory
a distinctpublicinterestproducesthingseach yearof its
strip-mining
an obviouscaseinpoint,andtherearemanyothers life,buta mineraldepositjustliesthere:itsowner
as soonas we beginto thinkaboutenvironmental can realizea returnonlyif he eitherminesthe
Privatemarketresponsesmaybe too un- depositor if it increasesin value.So if you are
effects.
and sittingon yourlittlepile of X and confidently
too slow,based on insufficient
coordinated^
will
be
ac- expectto be able to sell it fora veryhighprice
case
there
In
information.
every
faulty
tionsthatpublicagenciescantakeandshouldtake; in theyear2000becauseit willbe veryscarceby
to see that then,you mustbe earningyour5 percenta year,
and itwillbe a majorpoliticalstruggle
can have or 10 percenta year,or whateverthe goingrate
how
one
I
see
But
don't
taken.
are
they
inthepredictions
ofmodels ofreturn
confidence
theslightest
is,each yearbetweennowand 2000.The
thatseemto makeno roomfortheoperationof onlyway thiscan happenis forthe value of X
arewrong, to go up by 5 percenta yearor 10 percenta year.
forces.If theforecasts
market
everyday
to theextent Andthatmeansthatanyonewhowantstouse any
thenso are thepolicyimplications,
X any timebetweennow and 2000 will have to
thatthereareanyrealistic
policyimplications.
has
to
come
of
resource
scarcity
paya priceforitthatis risingatthatsame5 percent
Everyanalysis
Of
to termswiththe factthatthe pricesof natural or 10 percenta year.Well,it'snothappening.
ourhoardofexhaustible
resourcesand resourceproductshave not shown course,we are exploiting
we
have
no
choice
aboutthat.We are
the
to
rise
over
resources;
past half-century,
any tendency
it
in thesensethat
relativeto the pricesof otherthings.This must certainly
exploiting wastefully,
offsets
so
far
been
into
there
have
other
to
waste
that
we
allow
each
mean
adequate
dump
products
ofdeposits-like theenvironment
fullaccounting
forcosts.
toanyprogressive
without
impoverishment
March-April1973/Challenge 4 7
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of theseeconomiesof scale.And I'm preButthereis verylittleevidencethatwe areexploit- benefit
to
pared guessthatthe U.S. economyis already
ingittoofast.
bigenoughto do so; I findit hardto believethat
wouldbe muchservedintheUnitsheerefficiency
Crowdingonplanetearth
ed Statesbyhavinga largermarket.
seemto showthat
I havelesstosayaboutthequestionofpopulation As it happens,recentfigures
for
is
States
the
United
it
to
involve
doesn't
seem
because
popuheading a stationary
any
growth,
of
is
to
the
current
that
lation:
in
At
difficult
say,
generation
conceptualproblems. anytime, any
to
be
seems
an optimalsizeofpopu- parents
fertility
patterns
establishing
place,thereis presumably
lation-withtheproperty
thattheaverageperson thatwill, if continued,cause the populationto
Even
wouldbe somewhatworseoffif the population stabilizesometimeduringthenextcentury.
willincrease
werea bitlarger,and also worseoffifthepopula- so,theabsolutesizeofthepopulation
tionwerea bit smaller.In any real case it must fora while,and level offhigherthanit is now,
haveleftus
to knowwhattheoptimum
be verydifficult
growth
popu- becausedecadesofpopulation
inthechildbearing
lationis,especially
becauseitwillchangeovertime witha bulgeofpopulation
ages.
I
But
have
it
is
and
also
because
as technology
alreadyarguedthata fewmillionmore
probchanges,
and a population
ably more like a band or zone than a sharply orlesshardlymakea difference;
I meanthatifyoucouldsomehow thathas once stabilizedmightactuallydecrease,
number.
defined
welfare
of
a
economic
perpersonagainst ifthatcametoseemdesirable.
plot graph
at leastfortheUnited
At thepresentmoment,
would
be
a
there
size,
verygentledome
population
seems
of
thana sharppeak.
orplateauat thetop,rather
States,thedanger rapidpopulation
growth
I don'tintendtoguesswhattheoptimalpopula- to be thewrongthingto worryabout.The main
tionfortheUnitedStatesmaybe. But I am pre- objectof publicpolicyin thisfieldoughtto be
paredto hazardtheguessthatthereis no point to ensurethatthechoiceof familysize is trulya
in optingfora perceptibly
choice,thataccessto thebestbirth-conlargerpopulationthan voluntary
Thatseemsto be
we nowhave,and we mightwell be contentwith trolmethodsbe madeuniversal.
smallerone. (I wantto emphasizethe all thatis needed.Of course,we knowverylittle
a slightly
aboutwhy
likelihoodthata 15 percentlargeror 15 percent aboutwhatgovernsvoluntary
fertility,
size
a
of
notion
smallerpopulationwould make verylittledif- the typical
good family changes
So it is certainly
to generation.
I also want fromgeneration
in ourstandardofwell-being.
ference
willreverse
recent
these
that
own
our
about
I
am
that
toemphasize
developments
possible
only
talking
willagain
control
that
and
themselves
offers
world
The underdeveloped
population
very
country.
This
remains
Mygeneralreasonforbelieving appearontheagendaofpublicpolicy.
specialproblems.)
thatwe shouldnotwanta substantially
largerpop- tobe seen.
abouttheDoomsthe
bad
know
We
all
ulationis this.
consequences In all thisI havesaidnothing
that
is
there
Models
because
of too largea population:crowding,
nothing
practically
congestion, day
excessivepollution,the disappearanceof open needsto be said. So faras we can tell,theymake
space-thatis whythecurveofaveragewell-being one verybad mistake:in thefaceof reason,comevidence,theyseemto
turnsdown at largepopulationsizes. monsense,and systematic
eventually
ofliving,
standards
that
at
assume
in
the
peoplewant
high
Whydoes thecurveeverclimbto a peak
more
affluent
become
first
place?The genericreasonis becauseof what more childrenas they
ofscale,becauseittakes (thoughovermostoftheobservedrange,a higher
calleconomies
economists
oflivinggoesalongwithsmallerfamilies).
tosupport standard
size
anddensity
certain
ofa
a population
a seriousone in termsof
is certainly
inerror
That
or publishing
chemicalindustry,
an efficient
uni- therecentAmericandata-butperhapsit explains
orengineering
orsymphony
orchestra,
dustry,
ofminewereable toreportthat
and soft- whysomefriends
hardware
or airline,or computer
versity,
World
of the Forrester
version
run
a
several
had
like
would
if
wareindustry,
they
especially you
oftwo
with
a
Model
be
can
ineach,so thatthey
firms
population
regulated Dynamics
starting
partially
in
500
it
blew
that
Butafter
all,itonlytakes peopleanddiscovered
years.
up
bytheirowncompetition.
to getthe ApartfromplacingthedateoftheGardenofEden
a populationofa certainsize or density
48
March-April1973
Challenge/
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in thefifteenth
whatelseis new?
century,
Thereis anotheranalyticalerrorin themodels,
as FredSingerhas pointedout.Supposeresource
tobring
exhaustion
orincreased
conspires
pollution
in industrial
a reduction
The
production. model
thensaysthatbirthrateswillrisebecause,in the
past,lowindustrial
outputhasbeenassociatedwith
in historical
highbirthrates.Butthereis nothing
will
evidenceto suggestthata once-richcountry
if
I
will
back
to
birth
rates
doubt
(as
go
high
hapoflivingfallsfroman accustomed
pen)itsstandard
thata society
highlevel.Commonsensesuggests
in sucha positionwouldfight
to preserve
itsstanthedesiredfamilysize.
dardoflivingbyreducing
In any case, thisis anotherexampleof a poorly
to
founded-orunfoundedintroduced
assumption
of
the
likelihood
support
overshoot-and-collapse.
Payingforpollution
Resourceexhaustionand overpopulation:that
as thelastoftheDoomsdayDevils.
leavespollution
The subjectis wortha wholelecturein itself,because it is one of thoseproblemsabout which
economists
to
actuallyhave something
important
to
not
I
the
to
each
other.
But
must
world, just
say
be brief.Fine printaside,I thinkthatwhatone
is the notion
getsfromthe Doomsdayliterature
thatairand waterand noisepollutionare an inesofeconomicgrowth,
capableaccompaniment
espeIf thatis true,thento be
ciallyindustrial
growth.
I realize
againstpollutionis to be againstgrowth.
thatin putting
thematterso crudelyI have been
thatis themessagethatcomes
unjust;nevertheless,
across.I thinkthatwayoflookingat thepollution
problemis wrong.
A correct
likethis.Exanalysisgoes something
cessivepollutionand degradation
of theenvironmentcertainly
industrial
accompany
growthand
the increasing
that
populationdensity
goes with
it. But theyare by no meansan inescapablebyproduct.Excessivepollutionhappensbecause of
flawin thepricesystem.Factories,
an important
powerplants,municipalsewers,driversof cars,
of coal and deep-miners
of coal, and
strip-miners
all sortsofgenerators
ofwasteareallowedtodump
intothe atmothatwasteintothe environment,
and
into
and
the oceans,
water
sphere
running
withoutpayingthefullcostof whattheydo. No
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wouldI. In fact,we actuallydo- directly
as drivers growth,
betweennow and the year 2000. What
of cars,indirectly
is not
as we buysome productsat a standsbetweenus and a decentenvironment
not an unbearable
pricewhichis lowerthanit oughtto be because the curseof industrialization,
theproduceris notrequiredto pay forusingthe burdenof cost,butjust theneed to organizeourto carryaway his wastes,and even selvesconsciously
environment
todo somesimpleandknowable
moreindirectly
as we buy thingsthatare made things.Comparedwiththepossibility
of an active
withthings
thatpollutetheenvironment.
abatement
economic
policy,thepolicyofstopping
This flawin the pricesystemexistsbecause a growth
inordertostoppollution
wouldbe incrediscarceresource(thewaste-disposal
It would not actuallyaccomplish
capacityof the bly inefficient.
and
that
bebecause
one reallywantsto reduce the
much,
environment)
goesunpriced;
happens
it
is
cause
ownedbyall ofus,as itshouldbe. The amountof,say,hydrocarbon
emissionto a third
flawcan be corrected,
eitherbythesimpleexpedi- or a halfof whatit is now.And whatno-growth
ent of regulating
the dischargeof wastesto the wouldaccomplish,
itwoulddo bycutting
offyour
environment
direct
control
or
the
by
by
slightly facetospiteyournose.
more complicateddevice of chargingspecial
prices-usertaxes-to thosewhodisposeof wastes The end theworldof
in air or water.These effluent
chargesdo three a matter
oftiming
theymakepollution-intensive
things:
goodsexpenofthem;they In theend,thatis reallymycomplaintaboutthe
sive,andso reducetheconsumption
make pollution-intensive
methodsof production Doomsdayschool. It divertsattentionfromthe
and so promoteabatement
of pollutionby reallyimportant
costly,
thingsthatcan actuallybe done,
producers;
theygeneraterevenuethatcan, if de- step by step,to make thingsbetter.The end of
of air the worldis at hand-the earth,if you take the
sired,be used forthe further
purification
orwaterorforotherenvironmental
improvements.longview,will fallintothesun in a fewbillion
Most economistspreferthisdevice of effluent yearsanyway,
unlesssomeotherdisasterhappens
to
charges regulation
bydirectorder.Thisis more first.In the meantime,I thinkwe'd be better
thanan occupational
Use of theprice offpassinga strong
sulfur-emissions
tax,orgetting
peculiarity.
has
certain
in
some
Trust
Fund
and
system
advantages efficiency
Highway
moneyallocatedto
decentralization.
a
mass
or
limit
a
humane
and decent
transit, building
on,say,
Imposing physical
sulfur
dioxideemission
oroverriding
President
is,afterall,a littlepeculiar. floorunderfamily
incomes,
It saysthatyou maydo so muchof a bad thing Nixon'sveto of a strongWaterQualityAct,or
and pay nothingfortheprivilege,
but afterthat, reforming
thetaxsystem,
or fending
offstarvation
thepriceis infinite.
Notsurprisingly,
one can find in Bengal-insteadof worrying
aboutthegenerala moreefficient
scheduleof pollutionabatement ized "predicament
ofmankind."
a
more
sensitive
tax
schedule.
through
Butthisdifference
ofopinionis minorcompared
THE ía)0^lV is
withthelargerpointthatneedsto be made.The
C0ïï''^& Ta AH
annualcostthatwouldbe necessary
tomeetdecent
standards
the
end of the
pollution-abatement
by
is
but
not
One
century large,
staggering. estimate
that
in
1970
we
says
spentabout$8.5 billion(in
1967prices),or 1 percentof GNP, forpollution
abatement.
An activepollutionabatementpolicy
wouldcost perhaps$50 billiona year by 2000,
whichwouldbe about2 percentofGNP bythen.
Thatis a smallinvestment
of resources:you can
see howsmallit is whenyou considerthatGNP
orso everyyear,on theaverage.
growsby4 percent
air
and
waterwouldentaila costthat
Cleaningup
wouldbe a bit like losingone-halfof one year's
y
'
END."
50
Challenge/
March-April1973
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