Their argument is a strawperson and degrowth maintains scientific empirical consensus – ensures accountability and allocation mechanisms through non-infinite expansion

Timothee Parrique, “A response to Alessio Terzi: Degrowth for good. Dismantling capitalism to save humanity from climate catastrophe”, WordPress, 17 April 2023, ,

Degrowth misses an allocation mechanism

“Under a capitalist system, prices provide incentives and signals so that these continuous allocation problems are solved in a decentralized way […] Under ecosocialism, everything instead becomes a centralized problem of allocation and must be solved through common decision-making, or a rulebook for all possible situation” (p. 68). This is a false dilemma with only two options: free markets that are efficient and democratic (capitalism) versus Soviet-style centralised planning that is the precise opposite. If degrowth criticises capitalism, Terzi suggests, then it must endorse the other.

This critique misses the point. First, allocation is a secondary issue for degrowth, which is first and foremost concerned with issues of scale. Let’s remember Herman Daly’s three goals: an economy should have a sustainable scale, a just distribution, and an efficient allocation (see Chapter 5 in Herman Daly’s Economics for a Full World). Even if one were to argue that free markets are the best allocative mechanism (I will have more to say about this soon), it still remains that an economy who operates over its biophysical carrying capacity is doom to collapse sooner or later. Debates over allocation should not distract from the fact that advanced capitalist economies currently suffer from a scale problem, namely the unsustainability of their ecological footprint.

The scale debate has two positions. Either you can show that high-income nations can keep increasing their levels of production and consumption while falling back within planetary boundaries (that’s the green growth position), or you must accept that a certain downscaling of economic activities will be necessary (that’s the degrowth position). I have spent considerable efforts since the publication of Decoupling debunked (2019) researching that dilemma and the scientific literature seems to be converging towards a growth-critical consensus, as exemplified by the results of the latest IPCC report. As someone whose job it is to find a way to make economies more sustainable, I would be the first to celebrate evidence of economic growth ceasing to be an ecological issue. But that’s simply not happening, as evidenced by a growing number of empirical studies showing something that is hardly surprising: producing more makes it harder to pollute less.

Back to allocation. If the jury is still out on the role of markets for degrowth (for my take on it, see pp. 289-301 in The political economy of degrowth), I cannot think of any growth-critical scholar defending their total abolition. What degrowth opposes is the constant expansion of the commodity domain. The access to certain goods and services (healthcare, education, housing, etc.) should be organised differently than through commercial competition. This can take the form of external regulations like minimum and maximum wages, the banning of fossil fuels ads as recently introduced in Amsterdam, or the pricing of carbon via a Tradable Energy Quotas. Or it can also happen by changing certain rules within markets. For example, Jennifer Hinton defends a vision of post-growth where allocation is organised via markets but only with “not-for-profit businesses” (markets without profits); Sophie Swaton proposes an “Ecological Transition Income” given via a system of local for-employment cooperatives (markets without unbalanced wage-labour relations); and a diversity of alternative monies are already in place trying to make market dynamics fairer and more sustainable (markets without general-purpose money). Since there is nothing in the degrowth literature indicating that markets as modes of allocation should completely cease to exist, criticising degrowth on that ground is deceitful.

What Terzi criticises here is not degrowth but socialism. But even that critique falls flat. Depicting planning as bureaucratic and uneconomic is as much a strawman [strawperson] as depicting markets as decentralised and efficient. Both allocating mechanisms, with their respective strengths and weaknesses, can experience a whole spectrum of performance. The real question is whether an allocative arrangement is appropriate. Most countries forbid the buying and selling of organs and most countries allow people to buy and sell socks. Markets are not fitting instruments to allocate organs and there is no pressing reason to carefully plan the sock economy. Reading Terzi, one feels that economies should choose between total marketisation and total planning. But this is not a football game. In practice, economies host a diversity of allocation mechanisms and I find little value in these heads-or-tails debates about ideal-typical economic systems that exist nowhere but in economic textbooks.