It is often said that only a madman — or economist — could believe that we can have infinite growth on a finite planet. Resources are scarce and dwindling, we’re told. Day in and day out, we seem poised to use up some civilization-critical ingredient, or we might overuse materials to the point of our own downfall.
The mindset that makes people believe that we’re perennially on the cusp of some disaster is on display everywhere from the big screen to the big assembly halls. It has been humanity’s plague since we first broke free of the Malthusian constraints that govern every non-human ecology. And never once do we seem to consider that maybe, just maybe, the madmen/economists know something the rest of us don’t.
We’re routinely given hyperbolic predictions about our doom, and no matter whether those predictions come true, they’re renewed in the same or slightly altered form a few years later. In the meantime, individuals, businesses, workers, investors, tinkerers, and all the others that make up the world economy solve much of the “problem.” Every popular scare of the past has been side-stepped, improved, or solved, by one or another human effort, usually serendipitously and rarely at all with well-meaning bureaucrats directing the process.
New York University economist Paul Romer, whose work on economic growth rewarded him the Nobel Prize in 2018, explains that “non-economists have said that [his article] helped them understand why unlimited growth is possible in a world with finite resources.” He credits that conclusion to his work on the proliferation of ideas, which he condenses into the following two statements:
“we can share discoveries with others,” and
“there are incomprehensibly many discoveries yet to be found.”
The basic rationale is thus simple: “Although we live in a world of a limited number of atoms,” as Marian Tupy and Gale Pooley say in their masterful creation Superabundance, “there are virtually infinite ways to arrange those atoms. The possibilities for creating new value are thus immense.”
Economic growth itself, said University of Mississippi economist Josh Hendrickson in an interchange with The Guardian’s George Monbiot a few years ago, is about “finding more efficient uses of resources.” It’s about observing how market prices and the profit motive urge entrepreneurs and businesses to economize on production while producing more value for consumers. We can visibly see this in the products that technology has merged into one (smartphones displacing a dozen or more physical appliances), or the thinner cans or more efficient engines that innovation routinely delivers.
Economists aren’t just playing word games when they say that growth can keep going forever. We can always make more stuff since the physical atoms under our command right now are far from all the physical atoms on our planet (or solar system). By growth, economists mean value-creation exchanged in the marketplace, a market that can change in the types of value we exchange, and the growing portion of our economies can involve fewer atoms than what came before.
“Resource” which the general public think of as physical collections of elements in the ground, economists define much more broadly. Nothing becomes a resource until the human mind makes it so, i.e., “there are no resources until we find them, identify their possible uses, and develop ways to obtain and process them” to quote Julian Simon, whose pioneering work in resource economics prompted Tupy and Pooley to launch their Superabundance project.
The geologists muddy the water further. According to the British Geological Survey, a “mineral resource” is the natural concentrations of minerals or rocks that could be of economic interest, whereas “reserves” are sites that have been submitted to testing and “has been fully evaluated and is deemed commercially viable to work.”
The boundaries between dirt, mineral resource, and mineral reserve can therefore shift with technology, economic circumstances, or legal rules regarding their extraction — subject to the “degree of geological certainty” and “feasibility of economic recovery.”
What’s even more incredible is that material abundance (how economically accessible certain minerals or agricultural products are) has historically speaking increased with population. Instead of individually starving when there are more humans on our supposedly finite planet, we seem to be collectively producing more, having better access to raw materials and the goods and services we produce with them.
Take almost any foodstuff, meat or cereal, fruit or vegetable, for almost any country over any period and the numbers go up and to the right: For eight centuries (probably more), an English laborer has been able to afford more and more foodstuffs for their labor; yet there’s more food production today than at any point in the past.
The counterintuitive conclusion follows naturally from Romer’s work: More humans give us more chances for ideas that exponentially “make material progress possible.” Human society is dynamic, not zero-sum.
Illustration: oil. Thirteen years ago, Camilla Ruz for The Guardian enumerated six natural resource scares to pay attention to, of which oil was one. Dire predictions like these are a dime a dozen in the environmentalist world, and no matter how publicly or unequivocally they are disconfirmed by reality, they pop up with renewed vigor a few years later. At the time we had some 46 years’ worth of oil reserves left; that is, at the prices, consumption rate, and technology of 2011, humanity would run out of oil by the late 2050s.
With a billion more people on the planet since then, having suitably burned some 386 billion barrels of oil in the intervening years, we now have… drumroll…48 years’ usage in global proven reserves; Humanity will now last until the 2070s before its (supposedly limited) reserves of oil run dry. Disaster avoided.
The price system, profit-hungry entrepreneurs, and optimizing consumers are pretty good at remedying scarcities when they emerge. If there isn’t enough oil, gas, wheat, gold, nickel, or copper for current human processes, the (real) price of those commodities rise; extracting businesses dig deeper or explore further, and consumers substitute away from the expensive commodity, or we recycle the metals that forever remain with us into something new. Higher prices mean that lower-quality ores are now worth mining, more inaccessible sources and geologists’ best guesses for where we could find more worth exploring. The outcome over decades and centuries is that “prices of resources are declining because more people means more ideas, new inventions and innovations,” according to Tupy and Pooley.
That we do not run out is the powerful lesson of both the history of resources and the theory behind their economic uses: Our minds and the black box of nifty ways to improve the world aren’t limited. We don’t run out; We simply find more.
The recurring “we’re running out of X!” outrage therefore seems so peculiar, so out of touch with even a semblance of reality. 194 years ago, before having seen but a tiny fraction of the improvements humanity would make over the following decades and centuries, British historian and poet Thomas Babington (raised to the peerage as Lord Macaulay) wrote
though in every age everybody knows that up to his own time progressive improvement has been taking place, nobody seems to reckon on any improvement during the next generation. We cannot absolutely prove that those are in error who tell us that society has reached a turning point […] but so said all who came before us, and with just a much apparent reason.
He then ended his colloquy with the sentence that human progress-types know by heart: “On what principle is it that, when we see nothing but improvement behind us, we are to expect nothing but deterioration before us?”
That was a reasonable enough question in 1830, and a terribly relevant one in 2024.