Sustainable Economic Growth And The New Zealand Economy Essay

“The primary concern is that a world of over six billion people striving materialistic satisfaction is drawing ever more heavily from finite supplies of natural resources to fuel an economic growth model destined to lead to an ecological disaster and global poverty without precedence” (Harder and Harder 1). As Harder and Harder explain, we must find an economic way of life that is economically stable. There are many different perspectives that view economic growth in different aspects. Advocates of economic growth have a very optimistic viewpoint about the future of economic growth. “Their operational logic reflects their sense of duty to develop latent resources into their actualized state for the benefit of a global

The sustainable growth rate is the rate at which a firm can grow while keeping its profitability and financial policies unchanged. The model allows an analyst to isolate drivers that have led to changes in historical growth in order to isolate causes of change. It is represented in four steps.

When a nation experiences a long-term economic growth, people have a positive attitude. There are opportunities for new jobs, new technology, and open doors for more capital for investment. The result of growth increases demand, supply, aiding the production of goods and services boosting consumers’ confidence. Economists believe the right type of growth that is stable and controllable is the best.

Economic growth positively produces more jobs and a strong level of economic growth can help individuals who are willing to find employment. Countries

Sustainable development is defined as “Development that meets the needs of the present generations without compromising the ability of future generations to meet their own needs” (IISD, par. 1 ).

Godrej’s “Myth 10: Growth is the Only Way” is the tenth installment of a series of articles addressing common “myths” about economics. As the title suggests, Myth 10 evaluates a common belief system stating continued economic growth is the only logical path for the future. Godrej refutes this idea, pointing out flaws in the economic growth mindset such as proliferation of hunger and poverty due to disproportional growth for the wealthiest individuals. Instead, Godrej claims, the best path for the future is to maintain a “steady-state” economy focused on stability and sustainability.

“Sustainable development is about meeting the needs of today without compromising the needs of future generations” (The Brundtland Report). Professors and intellectuals have been creating solutions, one I found interesting was an argument for creating a reserve fund for future generations through the taxation of non-renewable sources of energy put forward by professor Dieter Helm in his talk at the London School of Economics. (Helm) This method corroborates with Deborah Sik’s Payments for Environmental Services Approach (PSE) (Sik) While (PSE) and reserve fund approaches have their merits they provide incentive for monopolization and the dislocation of people that do not have property rights even if they have been using the land for generations. Deborah Sik criticizes the (PSE) system as it does not address the actual problem of unbridled growth, it merely attaches a new condition to capitalism that does nothing for the poor. Deborah Sik’s approach has merit because

Economic –“an economically sustainable system must be able to produce goods and services on a continuing basis, to maintain manageable levels of government and external debt, and to avoid extreme sectoral imbalances which damage agricultural or industrial production.” (Harris, 2000: 7)

The level of activity within the sector has grown rapidly in the past decade and is expected to continue growing, although at a more subdued level. The pace and scale of growth has caused concerns to be raised about the ability of New Zealand to capitalise on this influx currently and in the long term, as there are issues around capacity in some essential services for the sector.

Sir Paul Callaghan advocated for sustainable economic growth within New Zealand, arguing that New Zealand is not as ‘clean and green’ as once thought, and needs to work on improving the environment (McGuinness Insitute, 2011). In a keynote address for a conference in 2011 titled “Mapping New Zealand, Strategies for the Future”, Callaghan suggests that it is ironic that we tell other countries to not use their natural resources when we ourselves have

‘Limits to Growth’[2] is a book that tried to explain how economic expansion must soon come to an end , because of environmental limits. ‘Our Common Future’, the sequel to this book, starts from essentially similar understandings of the nature of the economy-environment interconnections, but draws the conclusion that growth can and should continue, however, this growth would take a different form from past growth, and should be sustainable. By the start of the 1990s about three-quarters of councils in England, Scotland and Wales already had a ‘green plan’ of some kind in effect or in preparation, some explicitly recognising the need to extend to global issues such as global warming as well as local matters. What was new in the 1990s was the degree to which central government began to give formal support to sustainable development, and to land use planning as a means of achieving it, in some cases producing the relevant policies and legislation in response to international commitments.

Chapter 6 1. “Providing the typical person alive in the future with a standard of living, including both material and environmental welfare, at least as high as that enjoyed by the typical person today” is one way to define sustainability. 2. GDP is a poor measure of sustainability because it: 1) fails to include the values of nonmarket production 2)

The aim is to achieve economic growth which is economically viable, environmentally sound and socially

Besides, for New Zealand, it has a similar economic experience with other developed countries in the first decade of the 21st century (Preston, 2011). With this relatively high speed development of New Zealand’s economy, its current account of the balance of the payment is kept with saving deficit for many years due to very high government’s spending and high growth in borrowing. There is no doubt that the economy of NZ can be stimulated through this kind of approach. However, this also could produce the inflation for this country because of the massive investments for the continued demand from New Zealander (Preston, 2011). For example, there is a rapid rise on property prices in NZ as the increased demands on that.

Economic growth implies a change in the way goods and services are produced, not merely an increase in production achieved using the old methods of