Defining growth dependence

Abstract

Many socio-economic systems require positive economic growth rates to function properly. These growth dependencies pose serious challenges given uncertainty about future growth rates and the role of economic growth as a driver of environmental crises. Thus, identifying and transforming socio-economic systems that currently rely on growth for their adequate functioning is a crucial step towards effective sustainability transformations. To facilitate conceptual clarity, we propose a general definition and framework for operationalizing the concept of “growth dependence” through four elements: (1) the system under investigation, (2) the unit of growth measurement, (3) the meaning of “growth”, and (4) the functions or properties of the system relevant for human well-being. We illustrate the impact of varieties in definitions on assessment outcomes by applying the framework to areas widely seen as growth-dependent: labor markets, social insurance and public finance. Our framework helps researchers to develop a more coherent understanding of growth dependence, a prerequisite for assessing policy options towards growth independence.