background image

Economic growth on a finite planet: should SDG 8 be rescued?

author image

By Wim Naudé

· 8 min read

Goal 8 of the UN's 17 Sustainable Development Goals (SDGs), adopted in September 2015, is to "promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all." It contains a sub-goal (target) of at least 7% per annum GDP per capita growth for the least developed countries. 

Eight years after this goal's adoption, progress has been limited, as in the case of the other SDGs. In low-income countries, GDP per capita growth has mostly been negative since 2006 — far off from the SDG target of 7.0%. Between 2015 and 2022, GDP per capita contracted in these economies by an average of 0.6% annually. Even in high-income countries, growth remains sluggish, marked by a "Great Stagnation." Appropriately, Nature concluded that for the SDGs, "A rescue mission is urgently needed." 

Some disagree. They argue that SDG 8 should be abandoned, claiming it contradicts the environmental SDGs. While their claims are worth consideration, it is argued here that it would be a humanitarian and ecological disaster to abandon economic growth. 

Economic growth facilitates social progress 

By 2020, world GDP per capita was, at an estimated US$5400, around 5600% higher than what it was about 10,000 years before, during the Greenlandian Age — and most of the GDP growth took place only after 1800 as a result of the industrial, scientific and enlightenment revolutions. As a result, humans are generally better off on virtually all human development indicators. Economic growth has also enabled social progress. As recently as two centuries ago, human society routinely enslaved people, subjugated women as a matter of course to the patriarchy, and considered autocratic states run by kleptocratic rulers God-given, amongst other horrors.

Growing wealth and upward social mobility enabled by exponential growth have thus profoundly improved society. As put by Kaitlin Kish and Stephen Quilley, "progressive forms of state, culture and society along with scientific rationality all depend very directly upon the progressive (growth) economy." One cannot decouple economic growth from social advances. 

Economic growth facilitates a positive-sum society

The Growth Commission, chaired by Nobel Laureate Michael Spence, warned against a zero-sum economy: "If an economy fails to grow, man's efforts to better himself become a scramble for a bigger share of a fixed amount of resources. Ecological stress quickly becomes social and political. "Similarly, physicist Tom Murphy has stressed that in the absence of economic growth, we risk our social progress, stating that "If our 21st Century standard of living peaks […] then we may not have the luxury of viewing our social progress as an irreversible ratchet.

In a zero-sum economy, the trust and cooperation required to overcome the enormous collective action problem that climate change poses, would evaporate like mist before a hot sun. 

The quality of economic growth 

It is undoubtedly the case that exponential growth over two centuries is threatening an ecological overshoot, which may lead to societal collapse and a "ghastly future." This should be taken seriously. There is indeed much that is dysfunctional about the global economy and the quality of some of the economic growth it has generated. This does not necessarily, however, imply that we should scrap economic growth and SDG 8 altogether; those who argue as such misunderstand economic growth. 

One mistake is to equate economic growth invariably with extraction. According to Steven Pinker, it is wrong "to think that people need resources' in the first place. They need ways of growing food, moving around, lighting their homes, displaying information, and other sources of well-being. They satisfy these needs with ideas: with recipes […] for manipulating the physical world to give them what they want." 

Put another way, "there's really no such thing as a natural resource. All resources are artificial. They are a product of technology," and moreover, "everything that nature gives us is in a highly inconvenient form […] Through effort and ingenuity we make natural materials and energy into what we need." 

The quality of economic growth — and of the ideas that drive it — is ultimately what matters. Hence, a fundamental criticism of the degrowth movement, which opposes the SDGs, is that it "fails to come to terms with qualitative versus quantitative aspects of economic growth […] [it] lumps all growth into a homogenous outcome." 

In this context, it is understandable that rather than reject economic growth, Nobel Laureate Joseph Stiglitz, economist Nicolas Stern and co-authors recently called for:

a new, cleaner, more efficient and more attractive form of growth, with better health and less pollution, in which case the apparent ‘costs of action’ may turn out to be negative [….] The successes in innovation in the past decade suggest this optimistic scenario may not only be a possibility but perhaps a probability.”

Phase shifts to new modes of economic growth

Over the course of modern humans' 300,000-year existence, different modes of economic growth can be discerned: that of the forager society, of the farming society, and the present industrial society. As Robin Hanson pointed out, each successive society was marked by a qualitatively different mode of economic growth significantly different from that which preceded it. Each experienced faster growth and had a shorter duration. One may argue that the current industrial society is in a phase-transition towards a post-industrial society, with its own unique mode of economic growth, which will be as different from the current mode of ecologically overshooting growth as the industrial society's growth was different from that of foragers. 

Hanson presents a perspective of an eventual post-industrial society where economic growth is so fast that the world economy could double every month - compared to the 35 years it currently takes. It will ultimately not be possible to grow this fast for very long unless humanity expands into the galaxy. If such growth is achieved by energy use that grows at only 2.3% p.a., then the economy would use up all the solar power that reaches the earth in 400 years and, after 1700 years, all the sun's energy.

One cannot imagine how a post-industrial mode of growth will eventually look or come about or how long it will last - just as foragers or pastoralists in centuries past would never have imagined that their descendants would come to depend on a collective intelligence known as the Internet. The problem with predicting future economic growth, material footprints and carbon emissions is that future knowledge and technology cannot be predicted. No one predicted the wheel.

However, it is known that in each transition, the dynamics of energy, population and ideas influenced growth trajectories and limits. For instance, food, urbanisation, and transport technology influenced the forager-agriculturalist transition and pathway, as fossil fuels, population growth and knowledge influenced the transition to and features of the industrial society. 

Today, the secular declines in economic growth that have been experienced in advanced economies since the 1970s reflect that energy, population, and ideas as engines of economic growth are facing headwinds. Peak oil, declining population growth and the specter of an empty planet, and "ideas getting harder to find" are making it more and more challenging to sustain the type of economic growth the world has experienced. This suggests that a post-industrial mode of economic growth will not depend on fossil fuels or an expanding population and will be increasingly dependent on innovations in methods of innovation - such as artificial intelligence (AI), for example (one reason it is important not to stifle progress in AI, as many are proposing). It will not be a stationary (post-growth) society — just like the end of the farming society was not followed by a stationary mode but by an acceleration. 

History teaches that the phase transitions between growth modes have been tumultuous (one such has been called the "dark ages"), partly because of uncertainty and oscillations in economic outcomes in between transitions. A significant challenge in the coming decades would be to minimise these oscillations by maintaining some semblance of economic growth. Failing, or worse, self-inflicting degrowth in such a world, will worsen matters. Innovation — finding new ideas to mitigate and adapt to climate change and ease the phase shift — requires economic growth. The bottom line is that “shrinking economies don't innovate." 


The failure to make progress on SDG 8 is disastrous from both a human development and environmental perspective. A rescue mission is urgently needed to stretch out and share the age of industrial growth and buy time to support the science, technology, and entrepreneurship — the ideas and recipes — to continue pursuing the worthwhile goals around which the world united in 2015.

illuminem Voices is a democratic space presenting the thoughts and opinions of leading Sustainability & Energy writers, their opinions do not necessarily represent those of illuminem.

Did you enjoy this illuminem voice? Support us by sharing this article!
author photo

About the author

Wim Naudé is Visiting Professor in Technology and Development at RWTH Aachen University, Germany; Research Fellow at the IZA Institute for Labor Economics, Germany; and Distinguished Visiting Professor in Economics at the University of Johannesburg. According to Stanford University’s rankings, he is amongst the top 2% of scientists in the world.

Other illuminem Voices

Related Posts

You cannot miss it!

Weekly. Free. Your Top 10 Sustainability & Energy Posts.

You can unsubscribe at any time (read our privacy policy)