IDEAS home Printed from https://ideas.repec.org/a/eee/streco/v61y2022icp242-254.html
   My bibliography  Save this article

The economic theory of qualitative green growth

Author

Listed:
  • Fabozzi, Frank J.
  • Focardi, Sergio
  • Ponta, Linda
  • Rivoire, Manon
  • Mazza, Davide

Abstract

Advanced economies are increasingly forced to act in order to mitigate climate changes and to reduce the impact of human activity on the environment. The key strategy promoted by the OECD and other international organizations is green growth. The key tenet of green growth is the ability of science and technology to let economies grow without damaging the environment. Banning unpredictable technology advances, empirical data cast doubts about the practical possibility of implementing green growth. This paper claims that we need to change the concept of growth, accepting qualitative growth as true growth. At the same time we need to change economic theory because mainstream economics recognizes only quantitative growth and would conclude that a healthy economy that grows qualitatively is in recession. We claim that economic theory is an abstract theory that can only model monetary variables plus abstract variables that represent the real economy. These variables are not descriptive but are only mathematical tools to connect monetary variables.

Suggested Citation

  • Fabozzi, Frank J. & Focardi, Sergio & Ponta, Linda & Rivoire, Manon & Mazza, Davide, 2022. "The economic theory of qualitative green growth," Structural Change and Economic Dynamics, Elsevier, vol. 61(C), pages 242-254.
    • Handle: RePEc:eee:streco:v:61:y:2022:i:c:p:242-254
    DOI: 10.1016/j.strueco.2022.02.005
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0954349X22000145
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.strueco.2022.02.005?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Samuelson, Paul A & Swamy, S, 1974. "Invariant Economic Index Numbers and Canonical Duality: Survey and Synthesis," American Economic Review, American Economic Association, vol. 64(4), pages 566-593, September.
    2. Thorstein Veblen, 1899. "Mr. Cummings's Strictures on "The Theory of the Leisure Class"," Journal of Political Economy, University of Chicago Press, vol. 8(1), pages 106-106.
    3. Cesar A. Hidalgo & Ricardo Hausmann, 2009. "The Building Blocks of Economic Complexity," Papers 0909.3890, arXiv.org.
    4. Stigler, George J., 2011. "Economics of Information," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 5, pages 35-49.
    5. Fisher, Franklin M, 1969. "The Existence of Aggregate Production Functions," Econometrica, Econometric Society, vol. 37(4), pages 553-577, October.
    6. Hallegatte, Stephane & Heal, Geoffrey & Fay, Marianne & Treguer, David, 2011. "From growth to green growth -- a framework," Policy Research Working Paper Series 5872, The World Bank.
    7. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    8. Ricardo Hausmann & Jason Hwang & Dani Rodrik, 2007. "What you export matters," Journal of Economic Growth, Springer, vol. 12(1), pages 1-25, March.
    9. Cameron Hepburn & Alex Bowen, 2013. "Prosperity with growth: economic growth, climate change and environmental limits," Chapters, in: Roger Fouquet (ed.), Handbook on Energy and Climate Change, chapter 29, pages 617-638, Edward Elgar Publishing.
    10. Carla Sciarra & Guido Chiarotti & Luca Ridolfi & Francesco Laio, 2020. "Reconciling contrasting views on economic complexity," Nature Communications, Nature, vol. 11(1), pages 1-10, December.
    11. Olimpia Neagu, 2020. "Economic Complexity and Ecological Footprint: Evidence from the Most Complex Economies in the World," Sustainability, MDPI, vol. 12(21), pages 1-18, October.
    12. Thomas Wiedmann & Manfred Lenzen & Lorenz T. Keyßer & Julia K. Steinberger, 2020. "Scientists’ warning on affluence," Nature Communications, Nature, vol. 11(1), pages 1-10, December.
    13. Jonathan Temple, 2006. "Aggregate Production Functions and Growth Economics," International Review of Applied Economics, Taylor & Francis Journals, vol. 20(3), pages 301-317.
    14. Ricardo Hausmann & César Hidalgo, 2011. "The network structure of economic output," Journal of Economic Growth, Springer, vol. 16(4), pages 309-342, December.
    15. T. W. Swan, 1956. "ECONOMIC GROWTH and CAPITAL ACCUMULATION," The Economic Record, The Economic Society of Australia, vol. 32(2), pages 334-361, November.
    16. Stéphane Hallegatte, 2012. "From Growth to Green Growth," Review of Environment, Energy and Economics - Re3, Fondazione Eni Enrico Mattei, August.
    17. Michael J. Boskin, 2000. "Economic Measurement: Progress and Challenges," American Economic Review, American Economic Association, vol. 90(2), pages 247-252, May.
    18. C. A. Hidalgo & B. Klinger & A. -L. Barabasi & R. Hausmann, 2007. "The Product Space Conditions the Development of Nations," Papers 0708.2090, arXiv.org.
    19. Joan Robinson, 1953. "The Production Function and the Theory of Capital," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 21(2), pages 81-106.
    20. Lucas, Robert Jr, 1976. "Econometric policy evaluation: A critique," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 1(1), pages 19-46, January.
    21. Jesus Felipe & Franklin M. Fisher, 2003. "Aggregation in Production Functions: What Applied Economists should Know," Metroeconomica, Wiley Blackwell, vol. 54(2‐3), pages 208-262, May.
    22. Zvi Griliches, 1961. "Hedonic Price Indexes for Automobiles: An Econometric of Quality Change," NBER Chapters, in: The Price Statistics of the Federal Goverment, pages 173-196, National Bureau of Economic Research, Inc.
    23. World Bank, 2012. "Inclusive Green Growth : The Pathway to Sustainable Development," World Bank Publications - Books, The World Bank Group, number 6058.
    24. Veblen, Thorstein, 2009. "The Theory of the Leisure Class," OUP Catalogue, Oxford University Press, number 9780199552580 edited by Banta, Martha.
    25. Martin Feldstein, 2017. "Underestimating the Real Growth of GDP, Personal Income, and Productivity," Journal of Economic Perspectives, American Economic Association, vol. 31(2), pages 145-164, Spring.
    26. Diane Coyle, 2014. "GDP: A Brief but Affectionate History," Economics Books, Princeton University Press, edition 1, number 10183.
    27. Veblen, Thorstein, 1899. "The Theory of the Leisure Class," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number veblen1899.
    28. Jesus Felipe & John S.L. McCombie, 2013. "The Aggregate Production Function and the Measurement of Technical Change," Books, Edward Elgar Publishing, number 1975.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Kashif Iqbal & Muddassar Sarfraz & Khurshid, 2023. "Exploring the role of information communication technology, trade, and foreign direct investment to promote sustainable economic growth: Evidence from Belt and Road Initiative economies," Sustainable Development, John Wiley & Sons, Ltd., vol. 31(3), pages 1526-1535, June.
    2. Chang, Jun-Jie & Mi, Zhifu & Wei, Yi-Ming, 2023. "Temperature and GDP: A review of climate econometrics analysis," Structural Change and Economic Dynamics, Elsevier, vol. 66(C), pages 383-392.
    3. Aziz, Ghazala & Sarwar, Suleman, 2023. "Revisit the role of governance indicators to achieve sustainable economic growth of Saudi Arabia – pre and post implementation of 2030 Vision," Structural Change and Economic Dynamics, Elsevier, vol. 66(C), pages 213-227.
    4. Lee, Chien-Chiang & Wang, Chih-Wei & Thinh, Bui Tien, 2023. "Green development, climate risks, and cash flow: International evidence," Pacific-Basin Finance Journal, Elsevier, vol. 79(C).
    5. Lu, Man & Zhao, Yue, 2024. "Mineral resource extraction and environmental sustainability for green recovery," Resources Policy, Elsevier, vol. 90(C).
    6. Mingyue Chen & Shuting Wang & Xiaowen Wang, 2024. "How Does Artificial Intelligence Impact Green Development? Evidence from China," Sustainability, MDPI, vol. 16(3), pages 1-23, February.
    7. Xu, Jiaqi & She, Shengxiang & Gao, Pengpeng & Sun, Yunpeng, 2023. "Role of green finance in resource efficiency and green economic growth," Resources Policy, Elsevier, vol. 81(C).
    8. Jin, Cheng & Luo, Shuangshuang & Sun, Kehan, 2023. "Energy Resources trade and investments for green growth: The case of Countries in the Asia-Pacific Economic Cooperation," Resources Policy, Elsevier, vol. 82(C).
    9. Chuansheng Wu & Yuyue Li & Lingling Qi, 2022. "Assessing the Impact of Green Transformation on Ecological Well-Being Performance: A Case Study of 78 Cities in Western China," IJERPH, MDPI, vol. 19(18), pages 1-21, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mealy, Penny & Teytelboym, Alexander, 2017. "Economic Complexity and the Green Economy," INET Oxford Working Papers 2018-03, Institute for New Economic Thinking at the Oxford Martin School, University of Oxford, revised Feb 2019.
    2. Hidalgo, César A., 2023. "The policy implications of economic complexity," Research Policy, Elsevier, vol. 52(9).
    3. repec:wsr:ecbook:2015:i:vi-004 is not listed on IDEAS
    4. Mealy, Penny & Teytelboym, Alexander, 2022. "Economic complexity and the green economy," Research Policy, Elsevier, vol. 51(8).
    5. Jan Mikael Malmaeus, 2016. "Economic Values and Resource Use," Sustainability, MDPI, vol. 8(5), pages 1-20, May.
    6. Yashin, Pete, 2016. "Кризис И Рост Неравенства. Оптимальный Путь Экономического Роста [The crisis and increasing inequality. The best equilibrium growth path]," MPRA Paper 73544, University Library of Munich, Germany.
    7. Yashin, Pete, 2014. "The Golden Rule of Capital Accumulation and Global Recession. Aggregate Production Function and the Cambridge Capital Controversy," MPRA Paper 58570, University Library of Munich, Germany.
    8. Castañeda, Gonzalo & Pietronero, Luciano & Romero-Padilla, Juan & Zaccaria, Andrea, 2022. "The complex dynamic of growth: Fitness and the different patterns of economic activity in the medium and long terms," Structural Change and Economic Dynamics, Elsevier, vol. 62(C), pages 231-246.
    9. Vanessa Echeverri & Juan C. Duque & Daniel E. Restrepo, 2021. "Identifying poverty traps based on the network structure of economic output," Papers 2108.05488, arXiv.org, revised Aug 2021.
    10. Alje van Dam & Koen Frenken, 2019. "Variety, Complexity and Economic Development," Papers 1903.07997, arXiv.org.
    11. Balland, Pierre-Alexandre & Broekel, Tom & Diodato, Dario & Giuliani, Elisa & Hausmann, Ricardo & O'Clery, Neave & Rigby, David, 2022. "Reprint of The new paradigm of economic complexity," Research Policy, Elsevier, vol. 51(8).
    12. Vu, Trung V., 2020. "Economic complexity and health outcomes: A global perspective," Social Science & Medicine, Elsevier, vol. 265(C).
    13. Freire Junior, Clovis, 2017. "Economic diversification: Explaining the pattern of diversification in the global economy and its implications for fostering diversification in poorer countries," MERIT Working Papers 2017-033, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    14. Dany Bahar & Hillel Rapoport & Riccardo Turati, 2019. "Does Birthplace Diversity Affect Economic Complexity? Cross-Country Evidence," CESifo Working Paper Series 7950, CESifo.
    15. Daniel Nepelski & Giuditta De Prato, 2020. "Technological complexity and economic development," Review of Development Economics, Wiley Blackwell, vol. 24(2), pages 448-470, May.
    16. Destek, Mehmet Akif & Hossain, Mohammad Razib & Aydın, Sercan & Shakib, Mohammed & Destek, Gamze, 2023. "Investigating the role of economic complexity in evading the resource curse," Resources Policy, Elsevier, vol. 86(PB).
    17. Olimpia Neagu, 2020. "Economic Complexity and Ecological Footprint: Evidence from the Most Complex Economies in the World," Sustainability, MDPI, vol. 12(21), pages 1-18, October.
    18. Antonis Adam & Antonios Garas & Marina-Selini Katsaiti & Athanasios Lapatinas, 2023. "Economic complexity and jobs: an empirical analysis," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 32(1), pages 25-52, January.
    19. Andreas Reinstaller & Werner Hölzl & Johannes Kutsam & Christian Schmid, 2013. "The Development of Productive Structures of EU Member Countries and Their International Competitiveness," WIFO Studies, WIFO, number 46823.
    20. Fernandes, Leonardo H.S. & de Araújo, Fernando H.A. & Silva, Igor E.M. & Neto, Jusie S.P., 2021. "Macroeconophysics indicator of economic efficiency," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 573(C).
    21. Sèna Kimm Gnangnon, 2023. "Do unilateral trade preferences help reduce poverty in beneficiary countries?," International Journal of Economic Policy Studies, Springer, vol. 17(1), pages 249-288, February.

    More about this item

    Keywords

    Endogenous money generation; Credit; Symbolic consumption; Innovation; Inflation; Dual economy; Qualitative growth; Unstable economy;
    All these keywords.

    JEL classification:

    • E00 - Macroeconomics and Monetary Economics - - General - - - General
    • E17 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Forecasting and Simulation: Models and Applications
    • E19 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Other
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:streco:v:61:y:2022:i:c:p:242-254. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/525148 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.