Prosperity Matters

What can prosperity possibly mean in a world of environmental, social and economic limits?—We work with people, policy and business to address this question, developing pragmatic steps towards a shared and lasting prosperity.

About CUSP

SIGMA: Confronting Inequality in Low Growth Economies

By Tim Jackson and Peter Victor | A four-sector, demand-driven macroeconomics model of Savings, Inequality and Growth in a Macroeconomic Framework (SIGMA). Desktop users can explore the model in the embedded online beta version below, or go directly to the ISEE page. For background about our system dynamics work, please see the project page.


Difficulties viewing the model? Please try the ISEE website directly for a full-screen view.

FURTHER READING

This paper presents a stock-flow consistent (SFC) macroeconomic simulation model for Canada. Contrary to the widely accepted view, the results suggest that ‘green growth’ (in the Carbon Reduction Scenario) may be slower than ‘brown growth’. More importantly, we show (in the Sustainable Prosperity Scenario) that improved environmental and social outcomes are possible even as the growth rate declines to zero.
This paper presents a stock-flow consistent (SFC) macroeconomic simulation model for Canada. Contrary to the widely accepted view, the results suggest that ‘green growth’ (in the Carbon Reduction Scenario) may be slower than ‘brown growth’. More importantly, we show (in the Sustainable Prosperity Scenario) that improved environmental and social outcomes are possible even as the growth rate declines to zero.
Economy
Finance
System Dynamics
July 24, 2020
This paper addresses the question of whether a capitalist economy can ever sustain a ‘stationary’ (or non-growing) state, or whether, as often claimed, capitalism has an inherent ‘growth imperative’ arising from the charging of interest on debt. Contrary to claims in the literature, we find that neither credit creation nor the charging of interest on debt creates a ‘growth imperative’ in and of themselves.
This paper addresses the question of whether a capitalist economy can ever sustain a ‘stationary’ (or non-growing) state, or whether, as often claimed, capitalism has an inherent ‘growth imperative’ arising from the charging of interest on debt. Contrary to claims in the literature, we find that neither credit creation nor the charging of interest on debt creates a ‘growth imperative’ in and of themselves.
Economy
Finance
System Dynamics
December 5, 2015
Global economic stability could be difficult to recover in the wake of the Covid-19, this Nature article finds. Even before the Covid-19 crisis, many of the world’s leading economies were experiencing larger slower growth cycles (recession cycles), suggesting precisely such a period of critical slowing down in the economic system. This analysis suggests that the added weight of the Covid-19 crisis may result in one of the weakest and most unstable recoveries in recorded history for many economies.
Global economic stability could be difficult to recover in the wake of the Covid-19, this Nature article finds. Even before the Covid-19 crisis, many of the world’s leading economies were experiencing larger slower growth cycles (recession cycles), suggesting precisely such a period of critical slowing down in the economic system. This analysis suggests that the added weight of the Covid-19 crisis may result in one of the weakest and most unstable recoveries in recorded history for many economies.
Economy
System Dynamics
June 26, 2020
It is clear that the larger the economy becomes, the more difficult it is to decouple that growth from its material impacts... This isn't to suggest that decoupling itself is either unnecessary or impossible. On the contrary, decoupling well-being from material throughput is vital if societies are to deliver a more sustainable prosperity—for people and for the planet. (This article is posted on the Science website).
It is clear that the larger the economy becomes, the more difficult it is to decouple that growth from its material impacts... This isn't to suggest that decoupling itself is either unnecessary or impossible. On the contrary, decoupling well-being from material throughput is vital if societies are to deliver a more sustainable prosperity—for people and for the planet. (This article is posted on the Science website).
Economy
System Dynamics
November 26, 2019
We often hear that it’s the journey and not the destination that really matters. Nowhere is this truer than when thinking about climate change. In this blog, CUSP co-investigator Peter Victor is introducing his illustrative carbon budget simulator, that can be used to explore different approaches to achieving an emissions target and remaining within a target budget. (This blog was updated on 30 March 2020 to include an addendum on the Corona crisis.)
We often hear that it’s the journey and not the destination that really matters. Nowhere is this truer than when thinking about climate change. In this blog, CUSP co-investigator Peter Victor is introducing his illustrative carbon budget simulator, that can be used to explore different approaches to achieving an emissions target and remaining within a target budget. (This blog was updated on 30 March 2020 to include an addendum on the Corona crisis.)
System Dynamics
March 12, 2020
This working paper presents a stock-flow consistent (SFC) simulation model of a national economy, calibrated on the basis of Canadian data. LowGrow SFC describes the evolution of the Canadian economy in terms of six financial sectors whose behaviour is based on ‘stylised facts’ in the Post-Keynesian tradition. Contrary to the accepted wisdom, the results indicate the feasibility of improved environmental and social outcomes, even as the growth rate declines to zero.
This working paper presents a stock-flow consistent (SFC) simulation model of a national economy, calibrated on the basis of Canadian data. LowGrow SFC describes the evolution of the Canadian economy in terms of six financial sectors whose behaviour is based on ‘stylised facts’ in the Post-Keynesian tradition. Contrary to the accepted wisdom, the results indicate the feasibility of improved environmental and social outcomes, even as the growth rate declines to zero.
Economy
System Dynamics
November 19, 2019
Sluggish recovery in the wake of the financial crisis has revived discussion of a ‘secular stagnation’. These conditions have been blamed for rising inequality and political instability. Tim Jackson contests this view, pointing instead to a steadfast refusal to address the ‘post-growth challenge’.
Sluggish recovery in the wake of the financial crisis has revived discussion of a ‘secular stagnation’. These conditions have been blamed for rising inequality and political instability. Tim Jackson contests this view, pointing instead to a steadfast refusal to address the ‘post-growth challenge’.
Economy
Health
Politics & Enterprise
System Dynamics
May 13, 2018
Taken together, the suite of system dynamics models developed by Tim Jackson et al represent the first steps in constructing a new macro-economic synthesis capable of exploring the economic and financial dimensions of an economy confronting resource or environmental constraints.
Taken together, the suite of system dynamics models developed by Tim Jackson et al represent the first steps in constructing a new macro-economic synthesis capable of exploring the economic and financial dimensions of an economy confronting resource or environmental constraints.
System Dynamics
April 6, 2016
Revised second edition of Peter Victor's influential book. Human economies are overwhelming the regenerative capacity of the planet, this book explains why long-term economic growth is infeasible, and why, especially in advanced economies, it is also undesirable. Simulations developed with Tim Jackson, show that managing without growth is a better alternative.
Revised second edition of Peter Victor's influential book. Human economies are overwhelming the regenerative capacity of the planet, this book explains why long-term economic growth is infeasible, and why, especially in advanced economies, it is also undesirable. Simulations developed with Tim Jackson, show that managing without growth is a better alternative.
Economy
System Dynamics
January 22, 2019
Funded by the ESRC’s Rebuilding Macroeconomics network, the broad aim of this project is to develop an agent-based, stock-flow consistent macro-economic model capable of addressing the risks (and opportunities) associated with the transition to a net-zero carbon economy. The project combines elements from economics, finance and physics, as well as a number of sub-disciplines within each of these areas.
Funded by the ESRC’s Rebuilding Macroeconomics network, the broad aim of this project is to develop an agent-based, stock-flow consistent macro-economic model capable of addressing the risks (and opportunities) associated with the transition to a net-zero carbon economy. The project combines elements from economics, finance and physics, as well as a number of sub-disciplines within each of these areas.
Economy
System Dynamics
June 30, 2019