Herman Daly On Counterproductivity
- Herman Daly, Steady State Economics (San Francisco, Freeman, 1977) p. 101.
Over thirty years ago, Daly already suspected that we had reached the point where growth was diminishing our well being. Today, it should be clear that we have reached this point.
(Incidentally, Daly's analysis of counterproductivity is a bit different than my analysis in The End of Economic Growth. Daly points out that, as output increases, marginal utility declines and marginal total cost increases. I say that, as output increases, marginal utility declines and marginal external cost remains roughly the same. Both analyses are valid, but I prefer to talk about marginal external cost, because it lets me focus on the cost of environmental problems, while Daly focuses on the total cost of production plus environmental problems.)