Economic growth and the environment

Abstract

As the UK economy emerges from the downturn, attention is shifting to how best to return it to\nsustained and durable economic growth. But what does sustained and durable economic growth\nmean in the context of the natural environment?\nThe UK and the global economy face significant environmental challenges, from averting dangerous\nclimate change to halting biodiversity loss and protecting our ecosystems. There has been debate\nover whether it is possible to achieve economic growth whilst also tackling these challenges. This\npaper does not try to answer the question of what the sustainable level of economic growth might\nbe, but instead examines the link between economic growth and the environment, and the role of\nenvironmental policy in managing the provision and use of natural assets.\nMany question the value of continued growth in GDP, given its limitations – including as a measure\nof wellbeing – and some evidence of its diminishing benefits within rich countries. However,\nit remains essential to support continued improvements in factors that affect people’s wellbeing,\nfrom health and employment to education and quality of life, and to help the government deliver\non a range of policy objectives – economic, social, and environmental.