Growth and inequalities in a physicist's view

TL;DR

This paper challenges the necessity of continuous economic growth by analyzing physical constraints and costs, showing that growth leads to inevitable collapse and increased inequalities.

Contribution

It introduces a physical theoretical framework to analyze economic growth constraints and demonstrates that growth inherently causes inequalities and potential collapse.

Findings

Finite environment constraints limit continuous growth.

Costs grow faster than production, leading to collapse.

Inequalities increase as a necessary consequence of growth.

Abstract

It is still common wisdom amongst economists, politicians and lay people that economic growth is a necessity of our social systems, at least to avoid distributional conflicts. This paper challenges such belief moving from a purely physical theoretical perspective. It formally considers the constraints imposed by a finite environment on the prospect of continuous growth, including the dynamics of costs. As costs grow faster than production it is easy to deduce a final unavoidable global collapse. Then, analyzing and discussing the evolution of the unequal share of wealth under the premises of growth and competition, it is shown that the increase of inequalities is a necessary consequence of the premises.