Remarks initial delivered at the UK's Political Economy club in July 2020
My essay on markets and nature has multiple different threads, and it is difficult in a short amount of time to elucidate all of them in any detail. My forthcoming column in the FT focuses on the practicalities of implementing a low-carbon agenda. Today, I’m going to dive into a different aspect of the essay instead (but I’m more than happy to discuss other aspects of the essay if people have questions): the lineage of Malthusian thinking about nature in our current debates about climate change. I’m going to argue that there are key assumptions about the relationship between the economy and nature, and about human nature itself, which underpin Malthus’ pessimism. These are made explicit in Malthus’ work, but are often implicit in current discussions.
The thing everyone knows about Malthus’ Essay on Population Growth is that he was extremely pessimistic about the outlook for humanity:
“Population, when unchecked, increases in a geometrical ratio. Subsistence increases only in an arithmetical ratio.” P4.
In other words, since population will grow faster than means of subsistence, disease and famine will always be features of human existence.
In the introduction to his book, this is presented dispassionately as a ‘law of nature’. Discussion in subsequent chapters makes it clear, however, that this is rooted in the inability of people to discipline and restrain themselves i.e. some claim about human nature:
“It is a truth, which history I am afraid makes too clear, that some men of the highest mental powers have been addicted not only to a moderate, but even to an immoderate indulgence in the pleasures of sensual love.” P68
There is a recurring tone of despair at human self-destructiveness in Malthus’ essay which is exemplified in this quote. “Indulgence”, “addiction”, “immoderate”. Note also the reference to “history”. Malthus regards this as a universal, or at least extremely common theme, of humanity. It is not a geographically or historically specific point.
The measures he turns to in order to provide a bulwark against human stupidity are both economic and cultural. On the economic point he notes the incentives for and against pro-creation which clearly depend heavily on social policy:
“Impelled to the increase of his species by an equally powerful instinct, reason interrupts his career and asks him whether he may not bring beings into the world for whom he cannot provide the means of subsistence. In a state of equality, this would be the simple question. In the present state of society, other considerations occur. Will he not lower his rank in life?” P8-9
He goes on to argue strongly against the poor laws for incentivizing reproduction, or at least blunting the economic incentives that cut against it. But then again, he is very pessimistic about the prospect of any meaningful social reform. Any attempt to construct a society in which the wolves were kept from the door would be unsustainable because humans cannot be relied upon to acquiesce to such a pleasant state of affairs because, “The temptations to evil are too strong for human nature to resist.”
Part of his solution is the use of shame to keep the “passion of the sexes” in check. There are many potential examples I could use but I think his defence of “slut-shaming” is most interesting:
“The view of these difficulties presents us with a very natural origin of the superior disgrace which attends a breach of chastity in the woman than in the man. It could not be expected that women should have resources sufficient to support their own children” P63
While I was preparing for this, I also read a very interesting NBER working paper released this month which makes exactly these kinds of arguments about family institutions: that different norms serve an identifiable economic purpose in many cases. It’s genuinely fascinating to see the same idea expressed so explicitly 100s of years ago.
So in summary, what is the thrust of Malthus’ argument? It is about human nature, immutable, ahistorical, and terrible. The issue of overpopulation could be solved overnight if humans could be relied upon to be unselfish, or enlightened. Because they cannot, and because Malthus foresees no social or technological change which will change humanity’s relationship to the reproductive process, this leads us to our iron law of human misery, which crops up in the introduction. Partial solutions come only in the form of social institutions which shame the reproductive act, and provide disincentives to it.
Why dwell on this? What is the purpose of analysing a 200-year-old book in such detail? Because so much of Malthus’ despair, his exasperation with the human condition, and his bleak outlook echo in current discussions of climate change.
As Malthus has his iron geometric-arithmetic growth law, modern economics has fashioned its own law of natural degradation: the environmental Kuznets curve. Pollution (including Carbon dioxide) rises and then falls with economic development. Economic development entails industrialisation, and then a shift to a service economy. In turn, these entail a rapid rise in the carbon-intensity of the economy, followed by some retrenchment. Clearly the notion of there being a constant carbon intensity of industrial GDP is questionable. Many would not believe in the existence of a unique environmental Kuznets curve. However, some link between economic development and carbon emissions is at the core of our current analysis. Indeed, it is baked into policymaking. See for example the differential carbon reduction targets from Kyoto onwards.
The idea that growth entails some increase in carbon emissions is as unshakable today as the idea that an increase in agricultural output would be met with a population explosion in Malthus’ work. When I think about the extent to which this is welded with our understanding of the world, I think of Mark Fisher’s concept of capitalist realism: i.e. “it is easier to imagine the end of the world than the end of capitalism”. Now, I don’t think that the end of capitalism is the same thing as the end of hydrocarbon-based capitalism, but I think to some extent the same thing applies. Just as Malthus could not imagine a world in which humans would restrain their reproduction as their incomes rose, so our current thinking about economies and hydrocarbons proceeds on the assumption that there is a tradeoff between development and decarbonization. We cannot imagine it otherwise.
Even the images we use to think about sustainable development imply that carbon emission reduction is self-denying. I respect Kate Raworth a lot and I think Doughnut Economics is full of genuinely fascinating ideas, but I do think the image of the doughnut is illustrative of this idea. For the uninitiated, the doughnut diagram represents the balance between environmental sustainability and economic development. The hole of the doughnut is “too little” development, where we experience poverty, and the outside of the doughnut is “too much” where we being to undermine our environment. I submit that this metaphor posits almost precisely the tradeoff between economic wellbeing and environmental sustainability I am talking about. And it is an extremely “in vogue” idea amongst those who are conceptualizing environmentally sustainable economics.
Finally, we should talk about the pessimistic and moralizing tone which underpins both our modern approach to climate change, and Malthus’ understanding of the population problem. Just as Malthus links humanity’s grim future to its inability to restrain “the passion of the sexes”, so our present environmental malaise is often understood as a punishment for capitalism’s original sin: “consumerism”. Social media is awash with environmentalists evangelizing the self-sacrifice of not having children, for example. And as Malthus referred to marriage and sexual shame as key institutions for disciplining population growth, so ethical consumers, at least in the western world, seek to exculpate their consumerist sin through the ritual sorting of recycling, to be processed often by workers of colour earning less than the living wage. Alternatively, they might splash out on extortionately expensive electric cars, bursting with rare minerals mined by slave labour in the DRC. My point is that in both cases, the social problem is at least partially individualized, and shame and pointedly self-sacrificial rituals are seen as part of the solution.
So far I hope I have demonstrated that there are striking similarities between how Malthus thought about the problem of unsustainable population growth and how many of us think about climate change. To recapitulate, these are: the grounding of social laws in the generalization of historically and socially specific relationships; a refusal to imagine a reconstitution of these relationships; conceptualizing the theoretical solution to the unsustainability problem as one of self-denial; and a moralizing and pessimistic outlook on humanity’s attempts to implement this. One might reasonably ask, “so what?”. It is perfectly possible that Malthus was wrong, and we are now right. Maybe there was a solution to the population problem that there is not to the climate change problem.
I do not deny this. It certainly does not follow from the fact that Malthus was wrong to think in these ways that we are now wrong. However, some specific ways in which Malthus was wrong are, I think, instructive. There is a temptation to focus on the green revolution, which led to an explosion of agricultural yields much faster than population could keep pace. There is certainly a lesson to learn here, in that we as economists should never underestimate the potential for technological change to transform our constraints. There are certainly some who believe that exponential improvements in carbon capture technology and renewable energy will do for us what it did for Malthus. I am, I believe, almost uniquely unqualified to speculate about whether this is true.
Instead, I want to focus on the social changes that Malthus did not see coming. Namely, the advent of industrial, and then post-industrial, capitalism transformed the incentives for reproduction. Much attention has been paid to the role of contraception in changing birth rates, although recent research (Myers, 2017) has challenged this story. Instead, I think it is worth noting that across the board, industrialisation is associated with reductions in fertility, and within industrial countries, people do appear to respond to financial incentives. When human capital matters, there is a “quantity-quality tradeoff” for parents when it comes to children.
In other words, Malthus’ refusal to imagine a social structure in which rising incomes were associated with decreasing fertility fatally undermined his analysis. He failed to see that the situation he was describing was historically and socially specific. More importantly, he failed to imagine the possibility. History is replete with examples of this. Social and technological change can remake not only the incentive structure, but even the analytical models people use to make sense of the world i.e. the “common sense”. Often such changes are impossible to fully imagine in advance, and are perceived as inevitable in retrospect.
Today, such a shift may come in the way that hydrocarbons relate to our economic world. It is not my claim that this is inevitable. Nor is it my claim that such a revolution in our economic life will spontaneously emerge from technological change that is already baked in. The state of the climate emergency is such that rapid technological advance and radical social change may well need to be actively engineered. In my essay I propose specific examples of policies which will help.
It is my hope that future historians of economic thought will look at our current thinking on climate change in the same way that we now look at Malthus: masterful, insightful, but ultimately incorrect. If they do, I believe it will be for the same reasons.
Happy to take any questions.