ECONOMIC GROWTH, POPULATION GROWTH & THE ENVIRONMENT

EL - S1 IL - 2 - nur aini hidayati - 2011

Are there limits to growth?

We tend to measure the expansion of the economy in terms of increase in its national output Gross National Product (GNP) GNP is a measure of the level of economic activity in the nation Increases in GNP are generally known as economic growth A somewhat more rigorous definition of economic growth is in terms of increases in per capita GNP, rather than GNP itself.
EL - S1 IL - 2 - nur aini hidayati - 2011

Are there limits to growth? Limits to economic growth

The limited capacity of natural environments to receive the waste generated by economic systems The finite nature of exhautible resources

EL - S1 IL - 2 - nur aini hidayati - 2011

Limits to growth
In terms of per capita GNP, we are unlikely to say that people are better off economically if the economy grows but the average level of income falls. Why? Rate of population growth Population growth is also a source of pressure on natural environments.

EL - S1 IL - 2 - nur aini hidayati - 2011

Problem of population growth

EL - S1 IL - 2 - nur aini hidayati - 2011

Limits to growth
The Limits to Growth, a book by The Club of Rome, published in 1972 (Meadows, et al, 1972) The Malthusian analysis The study examined the interaction of existing trends in 3 main areas: 1.Population & food supply 2.Industrialitation & depletion of non renewable resources 3.Deterioration of the environment due to pollution & intensive agriculture
EL - S1 IL - 2 - nur aini hidayati - 2011

Critics of the limits to growth

Changes in technology enable us to extract more and more economic activity from a given unit of natural resource more efficient We tend to discover more and more resources We can control the amount of waste entering the environment by recycling materials and taking waste gases out before they leave the economic system

EL - S1 IL - 2 - nur aini hidayati - 2011

So what?
The limits to growth debate has a long history and it can never reach a firm coclusion. We choose to prevent it. It is generally within human capacity to decide what sort of environment we want. We then need to understand the ways in which individual decisions lead to environmental impacts and how collectively we can, often through the action of government, influence those incentives so as to produce the desired environmental outcome, because economics is concerned with these choices.

EL - S1 IL - 2 - nur aini hidayati - 2011