A stable state economy is a sustainable economic system where consumption and population rates are balanced through innovation and efficient resource use. It can include smaller regional economies and is based on increasing living standards. Opponents believe in limits to growth, but proponents believe in natural evolution towards sustainability. The key is using and recycling natural resources at a reasonable cost. Examples include pre-industrial island nations and advanced societies with low population growth and technological innovation.
A stable state economy is an economic trading system in which population and consumption rates are maintained at a relative level that is sustainable over the long term. While the phrase is used to describe national economic blocs and other large blocs, it can also include smaller regional economies based in cities or unique geographic regions. The underlying principle of the idea of a stable state economy is not that zero growth in wealth occurs over time. Instead, it focuses on increasing innovation and efficient use of resources to create a state where consumption and production rates are overall balanced. While some sectors of the economy may still be growing and others may be in a state of decline in a steady state of the economy, the overall management of the system ideally maintains a gradual level of lifestyle improvement that is sustainable in perpetuity.
Proponents of economic equilibrium and population dynamics believe that the world economy is gradually evolving towards a level of sustainability that will occur naturally given sufficient time. Examples of stable state economy systems are often based in more advanced societies, where population growth rates are low and increasing levels of technological innovation continually raise living standards. Developing nations, on the other hand, see their carrying capacity for consumption and production increase rapidly as their population is educated and natural resources are more effectively harnessed to fuel rapid growth.
Opponents of the constant premise of state economics believe in the process of limits to growth on an interconnected global scale, first stated by Thomas Malthus who was an early 19th century English scholar. Malthus’ ideas were later set forth in modern terms in the book The Limits of Growth, written in 1972 by Donella Meadows, Dennis Meadows, Jorgan Randers and William Behrens. Popular theory basically states that increasing resource availability and technological innovation only occur on a linear line, while population increases and resource demand occurs on an exponential curve. When population growth and resource consumption rapidly outpace innovation, the corrective factors of war, famine, and disease arise to reduce the resident population to sustainable levels.
Where the two economic systems overlap is how natural resources are used and recycled, and at what cost. A stable state economy cannot rely on any nation’s gross domestic product (GDP), as each nation tends to rely on foreign suppliers for certain key natural resources or labor skills. As industrialized nations transfer green technology to developing nations and developing nations move away from the dirty methods of rapid industrialization, the idea of a stable state-owned global economy is promoted. Of equal or greater importance is the ability of advanced nations to develop methods to conserve resources and energy consumption and implement effective recycling programs so that vital materials are not depleted before they can be replenished.
The idea of a stable state economy is often portrayed negatively in terms of uneconomic growth, zero growth, or decline eroding living standards as population increases. Arguments against this focus on technological innovation and international cooperation to prevent such declines. Some of this cooperation occurs naturally through the desire for profit, as in the example of electronic books slowly supplanting the sale of some hardcover books in the US economy, reducing resource and energy consumption. Other components of the cooperation arise out of simple necessity, such as the transfer of green technology to third world nations to avoid the prospect of global warming from industrialization based on coal or other highly polluting fuel sources.
An example of a stable state economy would include many pre-industrial island nations where economies relied on harvesting local produce and fish as food sources, housing was made from local materials, and the population lived well. This gave the local population plenty of free time for socializing and relaxation, and there were no shortages regarding basic needs. Conversely, a consumption-based society like many in the Western world that encourages the acquisition of excess wealth, houses, cars and more that is often not used by the owners is a consumption model that cannot be sustained globally or internationally. long-term national level.
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