macroeconomics; degrowth; scenarios; welfare; ecological economics

Abstract: The current structure of both the German economy and its social security systems is highly dependent on further economic growth. There are three reasons why it seems adequate to change this perspective and leave the growth path. (1) The ecological perspective: rising ecological damages combined with the fact that the needed decoupling of economic activity and ecological impact is not in sight. (2) The prosperity argument: as research shows, GDP is not an adequate indicator for measuring prosperity and must therefore be abandoned. (3) The stability argument: in the last decades the growth rates for Germany have been converging to zero. When using main macroeconomic indicators like unemployment or public debts the absence of high growth rates is highly problematic and urges strategies independent of growth. This present paper introduces a macroeconomic model of the German economy built on Peter Victor's LOW GROW model. Victor's concept provides a contribution to the macroeconomics of degrowth, exploring under which conditions a stable social and economic development within ecological limits is possible.

This media entry was a contribution to the special session "Macroeconomics of Degrowth I" at the 4th International Degrowth Conference in Leipzig in 2014.