Some people say growth can't happen forever, and all growth comes at environmental cost, but that simply isn't true. I can create digital goods and services which people buy, and this increases GDP, and it doesn't hurt the environment and is indeed economic growth in the realest sense. I can even give massages all day, and this also doesn't destroy the environment.
This is incorrect. Every economic output requires material inputs.
> I can create digital goods and services which people buy
Your digital goods and services require physical machines to run on. These machines are made of physical materials, including some rare earth minerals that are costly to extract. These machines require energy to run, which also requires material inputs.
> I can even give massages all day, and this also doesn't destroy the environment
Human beings like yourself require material inputs to live – food, shelter, energy, to name only a few. Just by being alive on a biosphere, you are impacting the environment in some way.
The size of that impact depends on your individual lifestyle.
There is simply no such thing as "immaterial" economic production.
> This is simply incorrect. Every economic output requires material inputs...There is simply no such thing as "immaterial" economic production.
Parent post was talking about marginal cost of production. E.g. where once we'd buy servers to run services on, we now share servers rented "by the cycle" from providers who amortize the cost over many users. Idle servers can be running at-the-moment economically valuable code for others. It's even possible that some economically valuable computation I might cause to be performed could consume an immeasurably small amount of power compared to the server sitting idle.
i'm partial to the labor theory of value, not for pricing (which is better modeled with marginalism, as you speak to), but for an intrinsic value by which we can evaluate how well a particular market might be working. a well-functioning market should tend toward the intrinsic (labor) value of a good (if, for example, relevant information is widely available and known, competitors can easily enter and exit, distortions are minimized, etc.).
that's the whole point though. price can be highly decoupled from cost, which i'm positing is a signal of the magnitude of the distortions in a given market.
but to your question, you'd just "measure" price as the prevailing price that you see in the marketplace, and labor is measured as the aggregate cost of all labor inputs, including parts and raw materials and amortized capital costs. in a well-functioning market, you'd expect prices to trend with the labor value. the industry profit percentage would then be an reasonable expression of the riskiness of the market/industry (in drug discovery, it might be 50% but in grocery, it might be 5%).
so for example, if apple sells iphones for $1000 but it costs them $400 in labor to make and sell, their labor-price markup would be 250%. in a functioning competitive market, you'd expect a competitor like samsung to pursue those profits and, as a result, eventually drive prices down.
He said "Some people say growth can't happen forever, and all growth comes at environmental cost". Pointing out that "Every economic output requires material inputs" doesn't mean that there are limits to growth or that you can't have growth without environmental cost.
As an example, if you have a resource that you consistently get more efficient at operating, you can consistently use it to provide more and more value to the world (economic growth).
To use his example: if you take a human who would be using material inputs like food, and instead of them engaging in activity that did not provide value to society, they spent their time giving people massages, you have not increased the amount of physical resources being consumed (since the person was otherwise using the same amount of resources, just not doing anything of value).
This is an accounting trick, though. It works because people are willing to pay for a massage and not for whatever the person was doing. But to actually grow the economy, you have to continuously retask that person to ever more profitable activities.
You can also create growth by moving money in circles increasingly fast. Question is, how far we can push bullshit jobs before people get fed up with it? I'm not convinced that "forever" is the answer.
It's not an accounting trick. Different ways a person spends their time genuinely provide different levels of value to society.
If a doctor spends his time saving lives or spends his time watching television, the impact on the world's material resources isn't that different, but the amount of value to society is much greater if he is saving lives.
Again, to have economic growth you actually have to have growth. Once you get everyone doing the things that yield maximum economic value, you no longer have growth. You'd have to make more people (exponentially, under current economic regime), which costs physical resources.
As an aside, when talking about economic growth we're looking at economic, not social value, and it so happens that saving lives is one of the less valuable things. You can determine it by looking at the paychecks of doctors or ER personnel.
A desktop from a decade ago can still run productivity software, especially if you run Linux or another operating system that doesn't cut off support for non-technical reasons. It is true that some physical resources are going to be required e.g. electricity - but in general we are wasting tons of precious resources building "disposable" devices like cell phones that are used for only 2 years to do tasks that have little economic value. If we actually used hardware for more of its usable lifetime, we could greatly reduce long-term environmental costs.
>but in general we are wasting tons of precious resources building "disposable" devices like cell phones that are used for only 2 years to do tasks that have little economic value.
This is wrong in two ways. 1) Cellphones don't just last 2 years; lots of people have older models. Sure, a bunch of people get rid of theirs after 2 years, but then they go to the secondhand market, where people like me buy them for a small fraction of their original price and keep them for another year or two before reselling them. Frequently, older phones eventually find their way to developing nations where people can't afford the latest iPhone. Your argument sounds like someone whining about people leasing a car for "only" 3 years; what do you think happens to cars after the original owner trades it in?
As for "little economic value", that's just plain ridiculous. Smartphones have enabled all kinds of things that just weren't possible or easy before: managing your bank account remotely, sending money to people (e.g. Venmo), GPS navigation, communicating without playing telephone tag, etc. And they do it with much less energy than any PC uses.
> 1) Cellphones don't just last 2 years; lots of people have older models. Sure, a bunch of people get rid of theirs after 2 years, but then they go to the secondhand market,
Increasingly less so. On one side, you have cheap subscription plans that bundle usable (not too decent) phones, on the other hand, phone life is shortened by a combination of planned obsolescence, software bloat, and lack of security updates. Short sales cycles is what manufacturers plan for and actively work towards.
> Frequently, older phones eventually find their way to developing nations where people can't afford the latest iPhone.
I might be wrong, but I'm not convinced. Shipping costs money, phones are cheap, and both battery and flash memory have pretty short lifetimes now. A good chunk of phones are barely operational after 2-3 years.
RE benefits of smartphones, it's all true, but you can't run economic growth on it forever. Smartphone transformation happened. It's mostly done. Itself it won't fuel further growth. Production of hardware and software might, but that is not free in terms of energy/resources.
I have a stable of Android devices for compatibility testing. All of the handsets are still working, even the 2014 ones. But I don't expect you to treat my anecdotes as data!
Report: "Strategy Analytics: Average U.S. Smartphone Upgrade Cycle Now 33 Months"
Smartphone upgrade cycles have been steadily lengthening for years, which has important implications for smartphone vendors and wireless carriers alike. Slowing unit sales have led companies like Apple (NASDAQ:AAPL) to pivot toward subscription services in an effort to better monetize all of the devices that are already out there. ...
The slowing replacement cycle makes sense to me, for basically the same reasons that I don't upgrade my PCs nearly as fast as I did in the 1990s. The improvements aren't as dramatic from model to model or year to year. I'll keep using my current phone as long as it works, which looks to easily be 4+ years.
If phone manufacturers are deliberately trying to drive shorter replacement cycles, it's not working, at least not in the American market.
I have anecdotes to your anecdotes. Seen or used lots of Android devices that "wear down" under day-to-day use. The battery goes first, but flash degradation seems to be a thing too. And of course software bloat.
The report looks interesting, and switching to service model seems like a plausible explanation.
While your point is true on a basic level, I think The parent’s point is on to something.
There must be a level of economic production that falls below the level of emission that can be absorbed without contributing to climate change. Furthermore in <1billion years everything on earth dies anyway (due to an expanding, ageing, sun) - so it is sustainable to use <1billionth of non-renewable resources.
> There must be a level of economic production that falls below the level of emission that can be absorbed without contributing to climate change
You're right, there absolutely is such a level. The important point is that to stay at or below that level, you have to give up on the idea of perpetual, infinite growth. The inputs and outputs must remain constant.
My point was that there's no such thing as "immaterial" growth, so we can't escape this limitation by making a bunch of apps forever.
There is indeed perpetual growth. As long as the economic transaction benefits both of us, as all non-coercive economic transactions are, then the result is net-positive. This is why free trade is a good thing - we decide to trade because it benefits both of us. If trading resulted in a loss for one of us, we wouldn't trade.
To have economic growth, you have to actually grow the amount of trade being done. Can't see how you could do that forever - despite the best efforts of advertisers and companies engaging in planned obsolescence, who are largely responsible for the climate shitshow, people will at some point hit a consumption limit. You can play accounting tricks on GDP to some extent, but I'm not convinced this is enough. If value becomes completely detached from reality, people may lose faith in money, and the whole thing will just crash and burn.
Or simply reach peak population growth which is a common occurrence on the small scale. With population at a steady state, there is nothing GDP needs to outgrow.
If population is steady,GDP still must grow. Otherwise, most of the people who get ahead/gain a better life will do so at the expense of another. That is not a nice world to live in.
It does though. Proof (if you want to call it that, I accept it is not formally valid) via contradiction:
There is the immaterial economy which which might theorize can perpetually grow.
There is also the material economy which is rooted in real physics - ie, materials, energy (it will always take some energy to heat up water and prepare food, for instance). Can we rule out that buying metal and building material become completely free? Or that the cost of energy will be reduced to zero? If there is limited supply, there must be some cost and if that cost is too low, someone will buy it up, corner the market, and start charging the correct price.
If so, the material economy cannot grow forever (outside inflation, which is not real economic growth).
If the material economy cannot perpetually grow, but other parts can, then eventually that part of the economy will completely eclipse the non-material economy. As the part that perpetually grows goes to infinitely, the relative value of the part of the economy rooted in physical limits will be worth relatively nothing.
Which contradicts the earlier point part of the economy can perpetually grow when some parts do not, unless the parts which cannot perpetually grow simply become free.
Not only this but you must also take into account the source of the money that buys your digital goods.
There is a strong correlation between the environmental cost and economic growth. It might weaken but it will never be decoupled, as long as people do have 'material' needs.
If I sing beautiful songs on the street, that has a material value one could measure. It represents economic growth compared to a world where I do something unproductive, like arguing basic reasoning with people on HN. It does not, however, require more input materials.
I swear, one day I'll find out why the software crowd, of all people, is completely incapable of understanding the difference between "material" and "real".
Ahh but those machines are constantly becoming simultaneously more efficient and more powerful. And soon enough they'll all be ran on renewable energy.
OP said nothing about growing the population. His statement can be true even as world population growth is slowing.
Like many things, there may be no purely immaterial, but there is much (and increasing) practically immaterial.
> Ahh but those machines are constantly becoming simultaneously more efficient and more powerful.
There are limits to efficiency due to fundamental laws of physics. We're already hitting some, we might be far from others, but a) we may not hit all of them fast enough to met the demand of exponential growth, and b) after we hit them, we can't improve those machines/processes further.
we need to build the first solar power plant only using the output of a smaller solar plant, so electric digger, hydroponics for food, electric smelters etc. after that it's all downhill.
> Human beings like yourself require material inputs to live – food, shelter, energy, to name only a few. Just by being alive on a biosphere, you are impacting the environment in some way. T
They would be doing that if they were not giving massages.
that is a shortsighted reading. OP's job could have shifted from e.g. "driving a heavy truck all day for my plate of food" to running a program on a computer which generates only a miniscule fraction of the emissions. As such , the economy overall has become "greener" for equal benefit.
There an upper bound created by the limits of possible human time spent. You can raise them with technology or population growth, but there again, you're bumping up against ecological constraints.
You can raise them with technology or population growth, but there again, you're bumping up against ecological constraints.
Population growth, yes, but technology? Why can't technology continue to improve in terms of efficiency and environmental impact as well as productivity?
There are physical limits to efficiency. In different technologies were are different distances away, but there are always limits that we cannot exceed. We can get creative about not needing to get close to the limit, but the limits are always there stopping us.
I doubt it. Maybe mars and venus, but even there getting self sustaining is going to be hard. There is no reason to suspect that we will ever be able to get anywhere else with less than a generation ship, and no reason to believe we can make one them them that will work long enough...
Productivity growth is in that equation, which is also in admittedly short supply. Probably the most underrated essential factor of growth in a mature economy.
I don't doubt there is, but we really don't know when we'll hit the limits technology allows for. Present and future technological plateaus may just be temporary.
Even if this is would be true, is the idea that everyone shall work as and end in itself because of a dogmatic growth goal? At what point do we realise that it's based on artificial scarcity?
But doesn’t economic growth means an increase in consumption, however immaterial the product is? Meaning, there will still be a limit in what people can (not to mention want to) consume at the point we are saturated in Content™, so more people will just have to be made to increase economic growth.
More energy is required to create or obtain higher quality content. Some call this the “energy primacy” of the economy that is often not accounted for when talking about GDP growth—which I suspect is one of the reasons economics has been termed “the dismal science.”
If technological efficiency had any effect on lowering overall consumption, we would see that now. But we don't. Consumption in real terms is increasing at an exponential rate. This is called The Great Acceleration.
Turns out people use the efficiency of technology to just consume more. Your internet goods and services might increase consumption somewhere else. Some of it is even explicit. Google Ads is a digital service that explicitly is designed to increase consumption. In fact, all the great technology companies (Microsoft, Google, Apple) are designed around the idea that people will consume more. The tech industry, in aggregate, has been designed around getting people to consume more. Even Tesla, a green play, is designed around more consumption. Tesla could have been a company where you paid them, and they took your car and converted it to be an electric car by stripping the engine and adding batteries. This kind of play could have reduced real consumption. But that's not what Tesla is about.
We already did actually. LED lightbulbs caused household power useage to drop in spite of the proliferation of networked computing devices. Thats right adding in a whole new category of power consumers wasn't enough to make up for the drop.
