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In: Economics

Summarize “The Limits to Growth Model”

Summarize “The Limits to Growth Model”

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INTRODUCTION

In 1968, a group of about seventy five persons belonging to different strata of society from around the world founded the Club of Rome. It believed that the possibilities of continuous growth have been exhausted and timely action is essential in order to avert a planetary collapse.

It chose its initial theme “The Predicament of Mankind” in June 1970. It commissioned the research by four MIT scientists led by Donald Meadows which was published by the Club of Rome as The Limits to Growth in 1972. The second report entitled Beyond Limits was published in 1992 which gave fresh evidences as to how mankind has crossed beyond the limits.

The Model:

In the book of Jay Forester of MIT World Dynamics published in 1971 devised a model that investigates the interplay of such highly aggregated variables as world population, industrial world production, food supply, pollution and natural resources still remaining in the world.

Using the “system dynamics” methodology of Forester, the authors of the Limits to Growth constructed an elaborate computer model of the world. They presented a large and new type of model designed to predict the future development of five global inter-related variables: population, food production, industrial production, non-renewable resources and pollution.

The model is based on the thesis that “the continued growth leads to infinite quantities that just do not fit into a finite world.” This basic idea has been elaborated in a highly complicated model which cannot be easily described in equation form. This is because the many relations between the five variables are not rectilinear.

The multipliers in question depend on the level of the variables. Among the various relationships, there are “feedback loops” that register the effects of changes in one variable such as food production on another variable like population growth. For example, population growth is positively related to food production. But food production is negatively related to pollution, and pollution, in turn, is positively related to industrial output. The model also uses past data on such factors as growth rates of population, industrial output and agricultural production, and the estimates of rates of technological progress. These factors would lead to the use of new resources, raise agricultural productivity and control pollution.


The assumptions of the model are based on highly non-linear relations:

1. Population increase (the difference between the birth rate and the death rate) is influenced by crowding, food intake, pollution, and the material standard of living. A rise in any of these four factors tends to drive the birth rate downwards. The death rate decreases with increasing food intake and the material standard of living, and increases with increasing pollution and crowding.

2. The material standard of living depends on the level of capital, relative to the size of the population and the productivity of capital.

3. Non-renewable resources are continually used up by the production process. The lower the level of non-renewable resources, the more capital must be allocated to obtaining resources, and thus the productivity of capital for producing finished goods is less.

4. Agricultural production depends on land and on capital investment in agriculture. Land can be developed or eroded, depending on investment decisions. Yield per unit of land can be increased by capital, but with diminishing returns.

5. Pollution is generated by the production process and gradually absorbed into a harmless form by the environment. High accumulations of pollution, lower the absorbing capacity of the environment.



THE SCENARIOS

1987, the World Commission on Environment and Development put the idea of sustainability into these words:

A sustainable society is one that “meets the needs of the present without compromising the ability of future generations to meet their own needs.”

From a systems point of view, a sustainable society is one that has in place informational, social, and institutional mechanisms to keep in check the positive feedback loops that cause exponential population and capital growth. This means that birthrates roughly equal death rates, and investment rates roughly equal depreciation rates, unless or until technical change and social decisions justify a considered, limited change in the levels of population or capital.

Such a society, with a sustainable ecological footprint, would be almost unimaginably different from the one in which most people now live. Before we can elaborate on what sustainability could be, we need to start with what it need not be.

Sustainability does not mean zero growth.

Rather, a sustainable society would be interested in qualitative development, not physical expansion. It would use material growth as a considered tool, not a perpetual mandate. Neither for nor against growth, it would begin to discriminate among kinds of growth and purposes for growth. It would ask what the growth is for, and who would benefit, and what it would cost, and how long it would last, and whether the growth could be accommodated by the sources and sinks of the earth.

A sustainable society would also not paralyze into permanence the current inequitable patterns of distribution.

For both practical and moral reasons, a sustainable society must provide sufficiency and security for all. A sustainable society would not be a society of despon- dency and stagnation, unemployment and bankruptcy that current systems experience when their growth is interrupted. A deliberate transition of sustainability would take place slowly enough, and with enough forewarning, so that people and businesses could find their places in the new economy.

A sustainable world would also not be a rigid one, with population or production or anything else held pathologically constant.

One of the strangest assumptions of present-day mental models is the idea that a world of moderation must be one of strict, centralized government control. A sustainable world would need rules, laws, standards, bound- aries, social agreements and social constraints, of course, but rules for sustainability would be put into place not to destroy freedoms, but to create freedoms or protect them.

Some people think that a sustainable society would have to stop using nonrenewable resources.

But that is an over-rigid interpretation of what it means to be sustainable. Certainly a sustainable society would use nonrenewable gifts from the earth’s crust more thoughtfully and efficiently.


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