The Fourth Way in Practice: What Can be Done?

Abstract

Our starting point in this book was that, while development based on continuing output growth has been the major targe of government policy in all the rich countries, its results have been disappointing, and increasingly so. Even judged by traditional criteria, growth has been less, and less consistent, in the last 25 years than in the 25 years before. Such policies have failed to ensure full employment, and have not reduced — in some cases have increased — poverty. But more important, as we have argued in previous chapters, from the point of view of improving general welfare (supposedly the reason for economic activity) a pattern of devel opmnnt based on growth is completely unsatisfactory for three distinct sets of reasons. First, the resulting ecological impacts and likely future risks are such that there iso need to limit, not further increase, production and consumption. Moreover, this is true at a workd level, and if consumption is to rise in poor countries, so as to eliminate absolute poverty and reduce inequality, there is most likely a need for large reductions in consumption in rich countries. Secoud, the paid employment required for increased production is alienating and wasteful in a variety of ways and often harmful, so that there are large gains in welfare to be made from reducing employment time. And third, perhaps even more fundamentally, all the evidence suggests that beyond a minimum level required to meet basic needs, increases in the general level of consumption make no contribution to welfare. In so far as consumption (beyond this minimum) does affect welfare, this is mainly because individuals care about their consumption level relatii’e to others. This concern drives a process where people generally try to raise their incomes, but it cannot result in any overall improvement in welfare.