Degrowth – The Myth of Ever Expanding Growth Has Met Its Limits. Is Degrowth the Answer?

Matt Orszag (0:00)

And first, a quick word from our podcast sponsor.

SPEAKER_2 (0:05)

Faxed delivers superior data, analytics, and flexible technology to help more than 170,000 users see and seize opportunity sooner. For over 40 years, we have given investment professionals the edge to outperform with informed insights, workflow solutions across the portfolio lifecycle, and industry leading support from dedicated specialists.

Through market changes and technological progress, we're proud to have been recognized with multiple awards for our analytical and data-driven solutions, while staying connected to our clients and each other. Learn more at www.factset.com.

Matt Orszag (0:48)

Hey, everybody, welcome again to The Sustainability Story.

I'm Matt Orszag with the CFA Institute, and today we have Timothee Parrique, Doctor of Economics and currently researcher at the University of Lund in Sweden. Hey, Timothee.

Timothee Parrique (1:02)

Hello, Matt.

Matt Orszag (1:03)

Good to talk to you.

Today, we're gonna talk about degrowth. I know that's probably a new term for a lot of folks. I just kind of came across this about a year or so ago, and has been researching it since. But Tim is one of the global experts in the topic, so I thought it would be good to have him on the podcast to educate our members and investors on it. So without further ado, Tim, tell us a little bit about yourself and how you got here.

Timothee Parrique (1:27)

Well, how I got here.

That's a rather long story, but I could start telling you that I started university just studying economics, not caring much about the environment, not knowing anything about climate change. And that was back in 2007 So that was already a thing. Studied what we would now call mainstream economics for about three years. Then I went to Sweden and I discovered climate change, the environmental crisis, the ecological collapse. We'll see what's the best way of calling it. And so I came back and I thought, oh, that's what I want to study. So I studied environmental economics, found that disappointing. So I moved back to Sweden to study ecological economics. So ecological economics is a school of thought within economics as a science that exists since the 1980s. And what these people, ecological economists, have tried to do is to conceptualize how an economy interact with nature.

So I've studied that during my masters. And of course, when you study ecological economics, it means you have to rethink how an economy functions, always asking yourself about flows of energy and matter.

So I've studied economic growth with that new pair of glasses.

And so when you study a macroeconomy as a metabolism, that just eats energy and materials and reject that same energy and these same materials back into nature, well, you see economic growth in a different light. And I thought that was fascinating and no one was really talking about economic growth that way. So I decided to write a PhD on that, finished that two years ago. And now I just joined Lund University where I'm just researching that topic of degrowth again, but getting more specific.

Matt Orszag (3:14)

All right, great. Now is the part of the podcast that I'm most scared of because you get to quiz me on, what are some facts or figures around degrowth to help frame the conversation for everyone.

I'm fairly new to this, but I've read a lot. So let's see how smart I am or am not about degrowth and what you wanna talk about. So fire away, we'll see how I do.

Timothee Parrique (3:37)

Okay, I'm gonna start with a double question about fairly recent numbers about global inequality and about environmental inequalities. So my question to you, Matt, will be that one.

How much of the world wealth does the top 10% richest individuals own? And second part of the question, how much do these top 10% richest individuals pollute? Meaning what is their relative share of global emissions? And let's say in 2021

Matt Orszag (4:14)

What's their foot put? This is the second part of the question, right?

Timothee Parrique (4:18)

Yeah, exactly. If you take like-

Matt Orszag (4:19)

In percentage terms.

Timothee Parrique (4:20)

The entire percentage term.

Matt Orszag (4:23)

So the first part of the question is how much of the global wealth does the top 10% have? I'm going to say, can I give you a range or is that cheating?

Timothee Parrique (4:34)

Yeah, yeah, sure. No, it depends.

Matt Orszag (4:37)

It'll be a small range. It's not going to be one to a hundred.

I'm going to say 75 to 80%.

Timothee Parrique (4:44)

That's actually 76

Matt Orszag (4:46)

Okay, good.

Timothee Parrique (4:47)

So you're pretty on point. Well done.