Fear of Stagnation?

Worldwide economic growth is fostered, despite its severe conflicts with sustainability and despite the tendency of secular stagnation. To study whether this fostering is ‘only’ a question of political and individual will or ‘unavoidable’ to maintain economic stability, Oliver Richters and Andreas Siemoneit deliver a narrow micro level definition of a ‘growth imperative’. The authors divide the many alleged growth imperatives into five categories and review them, thereby reducing several reasonings to few core arguments. They conclude that neither commercial competition, nor profit expectations, nor the monetary system are stand-alone growth imperatives. Instead, when technological innovations (based on resource consumption) are introduced, market forces lead to a systematic necessity to net invest due to the interplay of creative destruction, profit maximization, and the need to limit losses. Unemployment is substantially caused by productivity gains, and the societal and political necessity of high employment explains why states ‘must’ foster economic growth. This explanation is culturally and normatively parsimonious and empirically substantiated.

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