Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist

by Kate Raworth

Handed your pencil and paper, any mainstream economist of the last half-century will most likely draw the very same image that we encountered in Chapter 1: an ever-rising line, known as the exponential growth curve, in which GDP increases by a fixed percentage (be it 2% or 9%) of its current size every period. They would, however, instinctively leave its leading tip hanging mid-air, as if in suspended animation. The trouble for economists who produce this picture is the obvious question that is left hanging in the air with it: what happens next? There are essentially two options. Either the line keeps rising indefinitely, rapidly shooting up off the top of the page, or it must start to flatten out and eventually come to a level. For the mainstream economist, the first option is awkward, the second unconscionable, and here’s why. The exponential growth curve, revisited.