Why is it necessary to “channel your inner 3-year-old” to reshape the economy?

At our Radical Old Idea event, Dr. Katherine Trebeck explained the basics of her recent book the Economics of Arrival to Kaisie Rayner. For Dr Trebeck, economics should be focused not on growing indefinitely, but instead on point of “arrival”: a destination that, once reached, allows us to “make ourselves at home”. To get here we must channel that inner 3-year-old, to constantly ask “why?”.

Why do we need more growth?

Why do we need to work 40-hour-weeks?

Why can someone work a full-time job and still be in poverty?

This focuses the mind on the point of arrival. The lack of an endpoint leaves our economies directionless, focusing too much “helping people and planet cope”, remedying social aches and pains without treating their root causes.

As she explained, growth up to a point is good, providing us with the means to live a decent life. In particular, growing the incomes of the poorest in society delivers results. However, beyond a certain point, it ceases to increase happiness (in development economics, this is often known as the ‘Easterlin paradox‘). Just like eating ice-cream, the first few mouthfuls are incredible, but after a while, each extra spoon provides less joy than the previous one.

Building on the food metaphor, she pointed out that growth should be a means to an end. Growth for growth’s sake is akin to walking into a restaurant and shouting “more!”. It’s far more important to know what it is that you want more of, such as looking after citizens, providing food, health services, and a decent material standard of living.

Some examples of economies that have arrived, or have the potential to arrive, include Japan and Costa Rica. Japan has a high standard of living, and relatively low inequality without extensive redistrubution. However, without a clear endpoint, the country suffers from high worker stress, when in fact it could “take its foot off the pedal” and lead a better life by slowing down.

Another exaple is that of Costa Rica, which is a middle income country that has thrived in terms of health, social and nature outcomes, because it has focused on outcomes rather than economic growth for its own sake.

The event concluded with a lively audience discussion which looked at how to practically ditch GDP, whether the focus on predistribution over redistribution was viable, the role of elites and more.

Find the Economics of Arrival at https://policy.bristoluniversitypress.co.uk/the-economics-of-arrival