Daily BulletinDaily Bulletin

News

  • Written by Cameron Allen, Researcher, UNSW

Despite 28 years of uninterrupted economic growth, future generations of Australians face being worse off due to increasing household debt, cost-of-living pressures, rising wealth inequality, climate change impacts and environmental degradation.

But our new research finds a fairer, greener and more prosperous Australia is possible – so long as political leaders don’t focus just on economic growth.

Evaluating Australia’s progress by 2030

We modelled four development scenarios for Australia through to 2030:

  • “Growth at all Costs”, emphasising economic growth
  • “Green Economy”, emphasising environmental outcomes
  • “Inclusive Growth”, emphasising social equality
  • “Sustainability Transition”, balancing economic, social and environmental outcomes.

Each scenario involved different policy and investment settings, particularly around tax and subsidies, government expenditure and private investment.

We then evaluated each scenario against the Sustainable Development Goals, an internationally recognised set of targets and indicators that measure national progress in 17 major areas. These include economic growth, poverty, inequality, education, health, clean water and clean energy.

We modelled 4 scenarios for Australia's future. Economic growth alone can't deliver the goods CC BY-NC-SA Goals, targets and indicators Each goal involves multiple targets and indicators. Goal 8, for example, is “Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all”. This involves 10 targets including per capita economic growth, decoupling economic growth from environmental degradation, and protecting labour rights. Each target comes with at least one indicator (for example, the growth rate of real GDP per capita, material consumption per GDP, and the rate of occupational injuries). In all, the 17 goals cover 169 targets. Because Australia has not adopted SDG targets, we chose 52 of those (with about 100 indicators) then modelled Australia’s progress in 2030 using our four scenarios. Read more: Australia falls further in rankings on progress towards UN Sustainable Development Goals The graph below shows each scenario’s score (with 0% meaning no progress, 100% target achieved) on each of the 17 goals. We also calculated an average score for each scenario across all goals to aid comparison. We modelled 4 scenarios for Australia's future. Economic growth alone can't deliver the goods Simulation results for each scenario across all 17 SDGs. The scenarios are: 1.GC = Growth at All Costs; 2. GE = Green Economy; 3. IG = Inclusive Growth; 4. ST = Sustainability Transition. Coloured bars show the % progress on each goal based on a set of targets from 0 to 100%. Cameron Allen, Author provided (No reuse) Growth alone is not the answer Our model projects a business-as-usual approach will achieve progress of about 40% across all goals and targets. The “Growth at all Costs’ scenario scored only slightly better: 42%. Economic growth – defined as an increase in a nation’s production of goods and services – is generally measured by the annual change in real gross domestic product (GDP). Our "Growth at all Costs” scenario involves accelerating economic growth through higher population growth and lower taxes. Net migration is modelled as being 350,000 a year by 2030, with the population reaching just over 30 million. The government’s tax revenue as a proportion of GDP is 10% less than now as a result of lower tax rates. Read more: If you think less immigration will solve Australia's problems, you're wrong; but neither will more Government spending is about 15% less (as a percentage of GDP), with cuts particularly to health, education and social security, but more spending on transport infrastructure. There are no new measures to tackle greenhouse gas emissions, land degradation or other environmental concerns. In our modelling this scenario increases GDP growth to about 2.6% a year, with low unemployment and declining government debt. But it comes at the expense of income inequality and the environment. Even on the one goal it might be expected to do relatively well – Goal 8 – this scenario performs quite poorly. That’s because the goal measures per capita GDP growth, not just the total GDP growth most politicians talk about, along with a range of social and environmental indicators. The following graphs show how the four scenarios compare on real GDP (i.e. adjusted for inflation), per capita GDP, income inequality and greenhouse gas emissions. We modelled 4 scenarios for Australia's future. Economic growth alone can't deliver the goods Caption here. Cameron Allen, Author provided (No reuse) Sustainability transition With an overall score of 70%, the “Sustainability Transition” scenario is the clear winner. This scenario modelled slower population growth and higher taxes on consumption, income and profits and trade. With net migration of 100,000 a year by 2030, the population reaches about 28 million. Tax revenue as a percentage of GDP is about 8.5% higher than now. This funds more spending on health, education and social security, as well as the equivalent to 1% of GDP on the sustainability of transport, water, energy, agriculture and energy systems. The overall result is economic growth of about 2.1% a year, with government debt 10% higher than our business-as-usual projection. But per capita GDP is higher. Unemployment and income inequality are lower. Fewer people live in relative poverty, and life expectancy is higher. Energy, water and resource consumption is down. So are greenhouse gas emissions. There is more forested land. This delivers a more prosperous, fairer and greener nation in 2030. Read more: Australia has the wealth to ensure a sustainable future, but too many people are being left behind Possible futures These results run contrary to the “growth and jobs” narrative that dominates political debate in Australia. Both sides of politics emphasise economic growth as the key to prosperity. But this narrative is clearly flawed when we look at a broader set of issues. The Sustainable Development Goals seek to capture all of these issues in a coherent way. Our study explores four plausible futures, and there are many other possible combinations that could be explored with worse or better results. What is clear is that business as usual certainly won’t ensure Australia has a more prosperous, fairer and environmentally sustainable society.

Authors: Cameron Allen, Researcher, UNSW

Read more http://theconversation.com/we-modelled-4-scenarios-for-australias-future-economic-growth-alone-cant-deliver-the-goods-126823

COVID-19: what Australian universities can do to recover from the loss of international student fees

arrow_forward

Crisis, disintegration and hope: only urgent intervention can save New Zealand's media

arrow_forward

Our needlessly precise definition of a recession is causing us needless trouble

arrow_forward

The Conversation
INTERWEBS DIGITAL AGENCY

Politics

$1.8 billion boost for local government

The Federal Liberal and Nationals Government will deliver a $1.8 billion boost for road and community projects through local governments across Australia.   The package of support will help lo...

Scott Morrison - avatar Scott Morrison

Scott Morrison press conference

PRIME MINISTER: This is a tough day for Australia, a very tough day. Almost 600,000 jobs have been lost, every one of them devastating for those Australians, for their families, for their commun...

Scott Morrison - avatar Scott Morrison

BOOST FOR BUSHFIRE RECOVERY

Local economic recovery plans will help towns and regions hit by bushfires get back on their feet as part of a new $650 million package of support from the Morrison Government.   As part of th...

Scott Morrison - avatar Scott Morrison

Business News

Your Complete Checklist For Hiring Professional Proofreading Services

Let's get one thing straight — a good proofreader is a writer's best friend. They are both incomplete without each other. The writer creates and the proofreader perfects. While there are a count...

News Company - avatar News Company

8 Simple Tips to Choose Your Team Members

The first-hand contributors to a particular project play an integral role in its successful completion. Identifying the most well-equipped and relevant team members for your project can have a great...

Katherine Guzman - avatar Katherine Guzman

How To Choose The Right Filing Cabinet For Your Office

If you’ve worked in an office, you should know how important filing cabinets are for proper storage of important documents. What about the cloud, you might ask? It’s as simple as this: even with man...

News Company - avatar News Company



News Company Media Core

Content & Technology Connecting Global Audiences

More Information - Less Opinion