Tuesday, September 11, 2012

Have we reached the end of economic growth?

That's the title of a piece in the Washington Post this evening.  (link here).  The picture on the left also comes from that piece, with the caption "Only flying cars can save us". 

The article reports on an  analysis by Robert Gordon at the National Bureau of Economic Research, entitled Is US Economic Growth Over?  The article is fascinating as evidence that the possibility of a "steady state" economy is entering mainstream economic analysis.  But don't expect any discussion of the positive benefits that such an economy might provide.  The prospect that Gordon might be right is described in the Post piece as "doom and gloom", "unnerving pessimism", and so on.

But why should this be the case? It is equally plausible to envisage the "end of growth" as a process of maturing, like a teenager entering adulthood; or even as a process of transformative change, like a caterpillar (another voracious consumer) becoming a butterfly. 

It would be a troubled teenager who regarded the news that s/he could not physically grow for ever as "doom and gloom" in any serious sense.

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