Economic degrowth as the path towards sustainable development

From product advertisements that feature smiling customers to promotions that encourage purchase, consumer culture is fueled by the commodification of happiness– the idea that the more we purchase goods, the happier we will be.

Consumerism is a key driver of economic growth, and growth is often associated with development. But directly correlating an increase in production with a better standard of living is inaccurate. Economic growth can induce development, but the fundamental question is ‘for whom is this development for?’

The Gross Domestic Product has been central to policies concerning economic growth since its conception in the 1930s, but it is not without its faults. In 2013, the Philippine GDP growth rate of 6.6% was the second highest in Asia, and for 2023, the country has a projected growth rate of 6.3%. Despite this, the Philippines still has the highest income inequality among the six largest economies in Southeast Asia.

Currently, the global manufacturing industry accounts for one-fifth of carbon emissions, and from 27 billion tons in 1970, consumption of natural resources rose to 92 billion tons in 2017. As  population continues to increase, economic growth should no longer be the basis of development policies. Of course, this is not to discount its benefits, but given today’s social and ecological crises, GDP as a measure of prosperity should be obsolete.

Concepts such as green growth emerged as a response to these challenges, but one ideology aims to shift away from growth itself. Jason Hickel, an economic anthropologist, defines degrowth as “a planned reduction of energy and resource use designed to bring the economy back into balance with the living world in a way that reduces inequality and improves human well-being.”

Although reduced production and consumption seems akin to the economic downturn that leads to a recession, degrowth is anything but. A recession is an unplanned economic reduction that has unmanageable impact across various sectors, which often leads to mass unemployment and worsened inequality. Degrowth is a planned policy that seeks to scale down environmentally degrading and less essential production.

But there is more to degrowth than de-growth. It also explores the intersection among environmental sustainability, social justice, and well-being and it addresses the environmental and social impacts of untethered consumption and production: scarcity, inequality, climate change, environmental injustice. At a micro level, degrowth would mean our lifestyles are less materialistic, we would grow our own organic food when possible, and choose more sustainable transportation options. At a macro level, it includes shifting taxation from labor to luxury and material consumption, incentivizing sustainable mobility, and investing in green spaces.

The idea of degrowth may sound bewildering to many. Why should we halt the growth of our economy? For one, with all the power the term "growth" holds, it is obscure at best: growth for whom, exactly? 

Doughnut Economics shares key ideas with degrowth– it aims to shift development from endless growth to creating a space where both the environment and its people can benefit from and thrive. For Kate Raworth, creator of the Doughnut, this space is found above the inner ring– the social foundation that everyone should have access to, like food, education, and gender equality; and below the outer ring– the ecological ceiling that ensures the planet’s stability. The key here is balance.

The framework was downscaled and implemented by cities at a local level. Amsterdam, among the first to adopt Doughnut economics, aims to reduce consumption, create a sustainable food system, and shift towards a circular approach to development.

Brussels emphasized a participatory approach to applying the framework by drawing on perspectives from political representatives, CSOs, private companies, and its residents.

Our consumption habits can exacerbate climate change. In fact, a 2015 study found that the production and consumption of household goods and services was responsible for over 60% of global GHG emissions. This is not to say consumers are the sole culprits. In actuality, firms encourage and capitalize on consumer culture.

Degrowth is not merely adopting a minimalist lifestyle, rather, it advocates for sufficiency– the notion that we must be content with what we have. Admittedly, the idea of growth still has a firm grip on society– media and companies alike promote the idea that more is better. We must start to shift away from this culture by reflecting on our values and habits. We may ask ourselves, will this purchase add value to my life? How often will I use this product? Degrowth is not an easy undertaking, but it may just be what can lead us away from the worst effects of climate change.

This article was written by Antonella Sampang (3 AB Economics), a volunteer for the Ateneo Institute of Sustainability.

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