Economic growth and environmental quality are compatible

Abstract

Man's relationship to the natural environment and nature's influence upon human life are among the oldest topics of speculation. Until modern times the major reason for concern was the prospect of “diminishing returns.” It was thought that population and economic growth would press against natural resource limits, and that economic welfare would fall to subsistence levels.

In modern times in developed nations the prospect of “diminishing returns” has been avoided. Population increase has abated to rates which promise stability in population numbers. Technology, capital accumulation, and improvements in labor force have yielded “increasing returns.” Per capita output grows at 2 or 3 % per year.

The modern concern is quality of environment and quality of life. The technology, industrialization and agglomeration which have yielded increasing returns of goods per capita have side effects. These are pollution and crowding, increased needs for public goods, expanded monopoly in the market places, and dilemmas of choice from affluence. The task for modern societies is to bend their enlarged technology and productive power to improving quality of environment and, more generally, quality of life.