Looking for growth imperatives under capitalism: money, wage labour, and market exchange

Publication: Working/Discussion PaperWU Working Paper

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First, I update and wrap up the discussion on a monetary growth imperative, namely the argument that debt-moneybearing interest triggers real GDP growth. I provide a detailed account of thedifferent versions of the argument and show why none of them hold. In allcases, the argument is shown to be inconsistent in macro-accounting terms or tobe at odds with the functioning of the monetary system. The general solution tothe monetary growth imperative is that a sufficient share of wealth must be putback in circulation, for example via higher consumption out of wealth ortaxation. Moreover, I show that a monetary growth imperative could equally welloccur in an economy without debt-money or interest. However, the solution tothe monetary growth imperative entails a sustainability paradox: more wealthput back in circulation allows to reach a stable full stationary state but maybe environmentally unsustainable. I also highlight convergences between thecritique of the monetary growth imperative and the monetary circuit literature.Second, I address the criticism that no net wealth accumulation is unrealistic.It requires to explain why there is accumulation in the first place. Buildingfrom post-Keynesian and institutionalist perspectives, I argue that we need tolocate the analysis at the level of the definitional social relations ofcapitalism: market exchange and wage labour. Growth imperatives are emergingproperties of these two social relations. I develop a critique of steady stateeconomics and underline the ontological difference between a zero-growth capitalism and a post-growth economy.
Original languageEnglish
PublisherWU Vienna University of Economics and Business
Number of pages28
Publication statusPublished - Aug 2022

Publication series

SeriesEcological Economic Papers

WU Working Paper Series

  • Ecological Economic Papers


  • growth imperative
  • capitalism
  • paradox of profit
  • ecological macroeconomics
  • post-growth

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