I often see statements in the news from economists saying things like “only 0.2% growth reported, which might have bad effects on the economy”. In my eyes infinite growth is simply impossible when we have finite resources, or is that a misconception from my part?
Edit: thank you for all the detailed an in-depth answers! Learned a lot of new things 🙂
In: 96
Hey 5yo, so many things we do to make the world better assumes growth of trade.
My job is a trade of my time for the boss’s money. My grocery trip is a trade of my money for the supermarket’s ice cream. The supermarket trades their money to Ben & Jerry’s company for the ice cream. Ben & Jerry’s trades their money for the farmer’s milk. The farmer trades his money for what my boss produced, and so on.
Why will I work extra hard unless I think that will help me get paid more in the future? Why will any boss give me a raise or hire me at all unless he thinks that will grow his business profit in the future? Why will the supermarket improve their selection of ice cream unless they think that will grow their profit in the future? Why will Ben & Jerry’s develop a new flavor or better packaging unless they think it will grow their profit in the future? Why will the farmer work at making more and better milk unless he thinks it will grow his profit in the future?
When we don’t think we will be rewarded with growth, we try less, and that leads to others trying less, and it becomes a vicious cycle. Examples can be found where there is some artificial limit to growth, such as an employee that is at the pay cap, apartment quality *and* renter quality after rent is controlled by law, small towns where population is not growing, economies of communist nations where extra labor is not rewarded, and video games that has run out of bigger rewards.
To not grow is to die, in economy, as in life. Grow well, my 5yo!
“Day 2 is stasis. Followed by irrelevance. Followed by excruciating, painful decline. Followed by death. And that is why it is always Day 1.” -Jeff Bezos
https://noteworthynonsense.com/blog/08/2020/bezos-amazon-letter-2016-day1
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