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A Simple Physics-Based Model of Growth-Based Economies Dependent on a Finite Resource Base

Author

Listed:
  • Philip Mitchell

    (Energy Geosystems Group, King Abdullah University of Science and Technology, Thuwal 23955-6900, Saudi Arabia
    These authors contributed equally to this work.)

  • Tadeusz Patzek

    (Energy Geosystems Group, King Abdullah University of Science and Technology, Thuwal 23955-6900, Saudi Arabia
    These authors contributed equally to this work.)

Abstract

Mainstream economics describes virtual wealth with theory that is at odds with the physical laws that govern a nation’s physical resources. This confusion fundamentally prevents the realization of “sustainable” economies. The relation between debt and the metabolism of a country (measured by GDP or power consumption) appears to follow a diffusion relationship, in which debt encodes the temporal evolution of an economic potential. Debt enables the production of resources and the realization of a country’s economic wealth potential (the sum of its environmental, geological, and societal endowments, among others). Any economic scheme dependent on finite stocks of free energy for growth must eventually collapse, and as such cannot be considered sustainable. Our simple debt–diffusion model is shown to closely match the trajectories of 44 different economies.

Suggested Citation

  • Philip Mitchell & Tadeusz Patzek, 2024. "A Simple Physics-Based Model of Growth-Based Economies Dependent on a Finite Resource Base," Sustainability, MDPI, vol. 16(18), pages 1-33, September.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:18:p:8161-:d:1480958
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    References listed on IDEAS

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