4 ms·

How can we have infinite, exponential economic growth on a finite planet?

mikeg8 4y ago
Growth isn’t solely tied to use of finite resources. Services also count. Two people can exchange a service, say a massage, which extracts zero finite resources, and at the same time, creates economic output. edited typo
- disqard 4y ago
  I've wondered about that, but it doesn't seem to add up. Maybe you can help me find the flaw in my reasoning (below): There's (at minimum) Time being exchanged. If A gives B a massage, A and B are investing that Time in this transaction (also, A is investing a space, a massage table, electricity for the physical space, etc.). All of these things are finite, and devoted to this service. If the service were not provided, these finite resources would not need to be locked up / extracted / used. To say that the providing of this service happened in a vacuum of "extracts zero finite resources" seems a bit disingenuous.
  - mikeg8 4y ago
    Thanks for engaging, it's beneficial for me to also think through this reasoning. I'm sure there are flaws in my understanding/example as well, but here is how I would respond: I think we are possibly using "finite" too loosely. A googled definition of "finite resource" is, "A resource that is concentrated or formed at a rate very much slower than its rate of consumption and so, for all practical purposes, is non-renewable." I do not believe space would be considered finite as it cannot really be "consumed." occupying a space does not deplete the resource of the space itself. Space on earth is more finite than "space", but still, there are many types of spaces for a massage to take pace: masseuses residence, the client's home, a park or yard, etc. In the economic sense, space doesn't seem finite while it may be in the Physics sense. A massage table doesn't seem finite either. If its made from wood, leather/cotton, those would be regeneratable resources and tables made with metal or plastics probably does not meet the definition of finite as a table is reusable and has a very very low rate of consumption (replaceability in this sense). Finally the most controversial: electricity! hard to argue against this without some squirming but 1) if the massage is rendered in a space with good natural lighting or outdoors, electricity is not mandatory 2) humans may find a way to make this resource much less "finite" in the future. Using the massage example was not a full-proof attempt on my part, but I can imagine others examples (vocal lessons, tutoring, coaching, selling flowers/eggs from a farm stand etc) that can be done without the "finite" resources we are discussing. My main point was that not all economic output is tied to the depletion of a finite resource.
    - Rury 4y ago
      >A massage table doesn't seem finite either. If its made from wood, leather/cotton, those would be regenerable resources But it is finite, because those resources aren't infinitely regenerable. You're forgetting that, in order to grow a tree (or animals for wool/leather), you need to take energy and material from somewhere else. This is physics 101: you cannot create nor destroy matter or energy, you can only change its form, but to do so always takes away from somewhere else. Hence because it takes both material and energy to grow a tree, and energy and material aren't infinitely available to us, then you cannot have infinite wood tables. So, the amount of wood tables we can have is therefore finite. Now if we converted all available material to us into wood tables, we can of course burn some them, so we again have more material to grow a new tree. Then after having grown a new a tree, we can turn it back into a wood table again. However, the amount of times we can repeatedly cycle back and forth like this between tables and trees, is not infinite, because this takes excess energy to do, and the amount of excess energy available to us is not infinite, ultimately because of the 2nd law of thermodynamics, but for anyone having trouble thoroughly understanding that law, more practically because the sun is eventually going to burn out.
      - mikeg8 4y ago
        Wow, this is a pretty big swing-and-a-miss, honestly. This discussion is about finite vs infinite in Economics, not physics. Arguing that wood is finite, in an economic sense, would be a laughable position - wood is almost always used as an example of an infinitely renewable resource.
        Rury 4y ago
        This is an ad hominem. I did not a miss at all. Economics is bounded by the laws of physics. So, because wood is finite in a physical sense, it is also finite economically speaking.
- mempko 4y ago
  A message isn't zero finite resources. People think software is ephemeral. It's not. Software has a physical manifestation (should be obvious, it runs on hardware and uses energy). By 2025 the internet alone will consume 20% of all energy.
  - mikeg8 4y ago
    Hello. see my response to the other comment RE finite resources and can you please provide a source for the stat about internet anergy consumption? seems suspicious to me...
dkokelley 4y ago
I guess eventually the earth will be swallowed up by the sun, but for practical purposes economic growth happens when we rearrange the atoms and bits at our disposal into things that people consider more useful. All of the materials to create a car existed here thousands of years ago, but we didn't value it as much until somebody figured out how to assemble it into a useful form. What's more, an old junk car might be valued at $3,000, but we can take most of the same materials and transform it into a new car with $15K (or other goods we consider worth more than the $3K car). The same finite resources + energy & labor (when used productively) = economic growth!
dav_Oz 4y ago
Depends on the metric and what you mean by growth per se. If no physical object is involved but rather just changes or reconfiguration of the - let's say - human brain, in the end, all possible states are limited by the (overall) entropy of our universe. If multiverses turned out to be accessible (i.e. empirical objects) then according to our current understanding there seems to be no limit. The closest limit isn't "economical" but much more "biological"/"societal". If we destroy the livelihood of our species before understanding/appreciating it - let alone transcending it fully (which some folks claim to be right around the corner) - we are just another failed (alien) civilisation who couldn't get past the threshold. The mathematical "exponential" part isn't the isolated problem but in combination with our limited understanding; flawed evaluation and the gross deficiencies in our current social structures (institutions, governments, bureaucracies, corporations, distribution of resources, conflicts of interests, "war" ...). The current economical incentives are just a reflection of that.
jpadkins 4y ago
energy and raw material per unit of GDP has been going down for a few decades (basically digital economy is more resource efficient). Sorry I don't have a citation handy. Your other assumption is we are going to stay on one planet, which I don't think is true. We will consume asteroids + resources on other planets when it is economically viable to do so. Also, the economy doesn't permanently "use up" earth's resources (other than a few exceptions that are fixed like land or go through a 1 way process like uranium). Water, wood, food, etc are all renewable resources. Even Petroleum might not be as finite as we currently think it is (https://www.scirp.org/journal/paperinformation.aspx?paperid=102438 https://www.scirp.org/journal/paperinformation.aspx?paperid=...)

Growth isn’t solely tied to use of finite resources. Services also count. Two people can exchange a service, say a massage, which extracts zero finite resources, and at the same time, creates economic output. edited typo

disqard 4y ago
I've wondered about that, but it doesn't seem to add up. Maybe you can help me find the flaw in my reasoning (below): There's (at minimum) Time being exchanged. If A gives B a massage, A and B are investing that Time in this transaction (also, A is investing a space, a massage table, electricity for the physical space, etc.). All of these things are finite, and devoted to this service. If the service were not provided, these finite resources would not need to be locked up / extracted / used. To say that the providing of this service happened in a vacuum of "extracts zero finite resources" seems a bit disingenuous.
- mikeg8 4y ago
  Thanks for engaging, it's beneficial for me to also think through this reasoning. I'm sure there are flaws in my understanding/example as well, but here is how I would respond: I think we are possibly using "finite" too loosely. A googled definition of "finite resource" is, "A resource that is concentrated or formed at a rate very much slower than its rate of consumption and so, for all practical purposes, is non-renewable." I do not believe space would be considered finite as it cannot really be "consumed." occupying a space does not deplete the resource of the space itself. Space on earth is more finite than "space", but still, there are many types of spaces for a massage to take pace: masseuses residence, the client's home, a park or yard, etc. In the economic sense, space doesn't seem finite while it may be in the Physics sense. A massage table doesn't seem finite either. If its made from wood, leather/cotton, those would be regeneratable resources and tables made with metal or plastics probably does not meet the definition of finite as a table is reusable and has a very very low rate of consumption (replaceability in this sense). Finally the most controversial: electricity! hard to argue against this without some squirming but 1) if the massage is rendered in a space with good natural lighting or outdoors, electricity is not mandatory 2) humans may find a way to make this resource much less "finite" in the future. Using the massage example was not a full-proof attempt on my part, but I can imagine others examples (vocal lessons, tutoring, coaching, selling flowers/eggs from a farm stand etc) that can be done without the "finite" resources we are discussing. My main point was that not all economic output is tied to the depletion of a finite resource.
  - Rury 4y ago
    >A massage table doesn't seem finite either. If its made from wood, leather/cotton, those would be regenerable resources But it is finite, because those resources aren't infinitely regenerable. You're forgetting that, in order to grow a tree (or animals for wool/leather), you need to take energy and material from somewhere else. This is physics 101: you cannot create nor destroy matter or energy, you can only change its form, but to do so always takes away from somewhere else. Hence because it takes both material and energy to grow a tree, and energy and material aren't infinitely available to us, then you cannot have infinite wood tables. So, the amount of wood tables we can have is therefore finite. Now if we converted all available material to us into wood tables, we can of course burn some them, so we again have more material to grow a new tree. Then after having grown a new a tree, we can turn it back into a wood table again. However, the amount of times we can repeatedly cycle back and forth like this between tables and trees, is not infinite, because this takes excess energy to do, and the amount of excess energy available to us is not infinite, ultimately because of the 2nd law of thermodynamics, but for anyone having trouble thoroughly understanding that law, more practically because the sun is eventually going to burn out.
    - mikeg8 4y ago
      Wow, this is a pretty big swing-and-a-miss, honestly. This discussion is about finite vs infinite in Economics, not physics. Arguing that wood is finite, in an economic sense, would be a laughable position - wood is almost always used as an example of an infinitely renewable resource.
      - Rury 4y ago
        This is an ad hominem. I did not a miss at all. Economics is bounded by the laws of physics. So, because wood is finite in a physical sense, it is also finite economically speaking.
mempko 4y ago
A message isn't zero finite resources. People think software is ephemeral. It's not. Software has a physical manifestation (should be obvious, it runs on hardware and uses energy). By 2025 the internet alone will consume 20% of all energy.
- mikeg8 4y ago
  Hello. see my response to the other comment RE finite resources and can you please provide a source for the stat about internet anergy consumption? seems suspicious to me...

dkokelley 4y ago

I guess eventually the earth will be swallowed up by the sun, but for practical purposes economic growth happens when we rearrange the atoms and bits at our disposal into things that people consider more useful. All of the materials to create a car existed here thousands of years ago, but we didn't value it as much until somebody figured out how to assemble it into a useful form. What's more, an old junk car might be valued at $3,000, but we can take most of the same materials and transform it into a new car with $15K (or other goods we consider worth more than the $3K car). The same finite resources + energy & labor (when used productively) = economic growth!

dav_Oz 4y ago

Depends on the metric and what you mean by growth per se. If no physical object is involved but rather just changes or reconfiguration of the - let's say - human brain, in the end, all possible states are limited by the (overall) entropy of our universe. If multiverses turned out to be accessible (i.e. empirical objects) then according to our current understanding there seems to be no limit. The closest limit isn't "economical" but much more "biological"/"societal". If we destroy the livelihood of our species before understanding/appreciating it - let alone transcending it fully (which some folks claim to be right around the corner) - we are just another failed (alien) civilisation who couldn't get past the threshold. The mathematical "exponential" part isn't the isolated problem but in combination with our limited understanding; flawed evaluation and the gross deficiencies in our current social structures (institutions, governments, bureaucracies, corporations, distribution of resources, conflicts of interests, "war" ...). The current economical incentives are just a reflection of that.

jpadkins 4y ago

energy and raw material per unit of GDP has been going down for a few decades (basically digital economy is more resource efficient). Sorry I don't have a citation handy. Your other assumption is we are going to stay on one planet, which I don't think is true. We will consume asteroids + resources on other planets when it is economically viable to do so. Also, the economy doesn't permanently "use up" earth's resources (other than a few exceptions that are fixed like land or go through a 1 way process like uranium). Water, wood, food, etc are all renewable resources. Even Petroleum might not be as finite as we currently think it is (https://www.scirp.org/journal/paperinformation.aspx?paperid=102438 https://www.scirp.org/journal/paperinformation.aspx?paperid=...)