The environment is one of the main concerns society has. The goals that nations have set for themselves to curb green-house gas emissions, along with the agreements they have reached, have proven to be not enough to counteract the damage we are creating. How could we then create a sustainable system that takes care of the environment? Many people believe that technology is going to be the game changer. As technology improves, the conventional thought says, the production processes will become more efficient and utilize fewer resources. But, is this true?
A quick analysis of a phenomena called Rebound Effect of Technology gives us a different perspective. The Rebound Effect states that an increase in energy efficiency may lead to less energy savings, or, in other words, the expected savings in energy consumption is absent and in fact, we end up utilizing more energy resources than before. The rebound effect was first mentioned by William S Jevons in 1965, in his book The Coal Question. Although he didn’t called it “Rebound Effect”, he discussed how the consumption of coal in England increased after the invention of a much more efficient coal-fired steam engine. This new invention made coal a more cost-effective source of energy, which increased its demand and created incentives for its use on many other industries (Brookes, 2000). In recent years, the Rebound Effect has been explained in more detail by the work of Daniel Khazzoom and Len Brookes, showing that the theory of increased consumption after the creation of a more efficient process can happen in many other industries, not just energy. Not only the Rebound Effect can make the energy source cheaper and therefore increasing its demand, but it can also increase consumption of goods that become cheaper due to the cost-reducing new efficiency (Hertwich, 2008).
The Rebound Effect and technology’s failure to counteract environmental degradation are some of the reasons why the conversation has switched towards questioning whether or not growth is the actual problem here. And the question is simple, “Can we grow unlimitedly?” We live in a finite planet and therefore, to assume that we can always grow seems implausible. Perhaps we need to switch to a model that focus on Development instead of Growth. In an interview, Chilean economist Manfred Max-Neef makes a distinction between Growth and Development:
"Growth is a quantitative accumulation. Development is the liberation of creative possibilities. Every living system in nature grows up to a certain point and stops growing. You are not growing anymore, nor he nor me. But we continue developing ourselves. Otherwise we wouldn’t be dialoguing here now. So development has no limits. Growth has limits. And that is a very big thing, you know, that economists and politicians don’t understand. They are obsessed with the fetish of economic growth." (Max-Neef, 2010)
Professor Max-Neef is also author of a very interesting hypothesis, which he called "The Threshold Hypothesis" (Max-Neef, 1995). It states that in every society there is a period in which economic growth (growth in GDP) brings about an improvement of the quality of life. But only up to a point, the threshold point, beyond which, if there is more growth, quality of life begins to decline.
Unlimited Growth is well represented by Cancer, for example. Cancer cells multiply and multiply until the body cannot handle it anymore and dies. If economic growth follows a similar pattern, a “Development of the economy” approach, therefore, sounds more appealing.
An essential step in our path to a switch from Growth to Development of the economy is to redefine how we utilize productivity increases, and the role of work hour reductions is a pivotal element of such shift. There are two ways to channel productivity increases. One way is to use it to produce more output in the same amount of time we were spending before. The other way is to produce what we need to produce, but using fewer hours to do it. The former is the one that we are currently applying. Every time we get an increase in productivity we tend to think that we could produce more, and sell more and generate more revenue and therefore make more profits. And of course, the demand for that extra output needs to be generated somehow, and therefore, marketing does a very good job at telling us that we need to buy that new cellphone, even though the one we have works great, or that we need to buy new clothes in order to keep up with fashion, even though the utility of the clothes we currently own is still high. This extra output produced requires more resources to be harvested, mined or extracted (and also transported), creating a cycle of environmental degradation that only exacerbates the problem. The option we should choose is to utilize the increases in productivity to produce what we were producing before (of course, adjusting for changes in the level of demand as necessary) but in fewer hours. Hence, if we use the increase in productivity to reduce work hours instead of producing more, we could have a system where our ecological footprint is reduced to sustainable levels, or at least, we could be in the right path to achieve such level.
It must be added that a transition to a zero or low growth economy is a long term goal and not short term. We could (and probably should) still pursue growth in the short-run, but we should also begin implementing policies to transition out of the "unlimited growth" mentality. If we keep channeling the productivity growth into more output, and therefore more income and more consumption, the system we have built will eventually collapse. It is imperative, from the environmental stand point that we focus on reducing work hours as a way revert this situation.