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Economics: Optimizing Growth
The chapter examines the issues of mutual influence of technological and economic growth, the pace of which, after unprecedentedly high rates in the middle of the twentieth century, stabilized and began to slow down. Limited opportunities for extensive growth, a decrease in demand due to the stabilization of demographic growth, a worsening problem of inequality, the transfer of most industries to low-income countries, as well as an aggravation of the environmental problem, are identified as causes of this slowdown. These circumstances lead to the question of whether the current system of capitalist relations ceases to be relevant. This chapter discusses the problems of future economic growth and available resources, its rates, as well as possibilities to transform capitalism, to support tendencies toward lessening of consumerism, and to move to a less stratified society. Grinin et al. emphasize that the problems of inequality, injustice, and overconsumption cannot be solved only through increasing regulation and redistribution, as is sometimes suggested. This is a way to create more contradictions and to split society (as we could see during the pandemic). Grinin et al. suggest that there are more complex but more effective ways through simultaneous use of regulations, development of innovative technologies, and keeping optimal rates of economic growth. Reducing social tension currently requires reducing wealth inequality and strengthening economic regulation, but these measures can suppress economic activity and extinguish economic growth. Without the personal initiative and personal interest of millions of people, the internal economic engine of society stalls; the common good cannot be created by redistribution alone. The development of the economy in conjunction with a correct social policy (redistribution) is the only way to raise the standard of living. And regarding inequality, it should not be about trying to eliminate inequality in principle but only about how to smooth it out without destroying the driving forces of development and, at the same time, reducing social tensions. The task of society is to find ways to channel development in the direction of a course that is beneficial for it, to find the optimal combination between private initiative and social programs, and between the growth of production as an important characteristic of economic development (without increasing the burden on the environment) and consumption optimization. In general, the authors' vision of economic development is that it is necessary to optimize it both in its pace and indicators and also take into account the need to more quickly pull growing economies closer to high-income ones. There are several factors, including the new technological wave—the Cybernetic Revolution—that are accelerating the development of third-world countries and providing conditions for world economic growth. At the same time, of course, the directions, sources, and centers of economic growth will change. So, the modern world economy has faced serious problems and limitations in growth opportunities, which has begun to slow down the growth of high-income and low-income countries. However, Grinin et al. do not believe that the opportunities for economic growth have been exhausted. On the contrary, the new technologies of the Cybernetic Revolution in 2030–2040 can give an impetus to an increase in economic growth rates compared to current rates. The authors also assume that in connection with the global aging of the population, the model of consumption in society will also change, and consequently, the model of the economy itself will begin to transform.
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