ABSTRACT
Introduction If growth means higher incomes, does higher quality of life always follow? Does development mean improvement in the standard of living? Standard neoclassical growth theory (Solow 1956; Lucas 1988; Maddison 1991) equates economic growth with economic development, implicitly assuming that growth brings improved quality of life or standard of living (Brinkman 1995). But this assumption is changing. Along with scholarly work in economics (Daly 1993; Norgaard 1994) there seems to be a growing popular movement for differentiating economic growth from development that is sustainable and improves people’s quality of life. The United Nations Human Development Index (HDI) and goals for sustainable development along with alternative measures like the Genuine Progress Index (GPI) for the United States (Talberth et al. 2006) are based on sustainability of development and production that improves quality of life. Many communities in industrialized countries are also developing locally based indicators of sustainability or quality of life to supplement traditional economic measures (Wismer 1999; Greenwood 2004). All of these measures reflect an increased recognition that improvement in people’s lives depends on more than just raising national income. We believe this stems from two primary factors. One is the growing realization that economic prosperity depends on environmental and social sustainability. Another is the desire for balancing economic well-being with other aspects of human welfare such as health, culture, and human relationships.1 Economic development, in our view, means a broad based and sustainable increase in the standard of living. It is not equivalent to undifferentiated growth in output and income. Economic growth may not be broad based or sustainable, and may not include elements of quality of life beyond income. In this chapter, we lay the foundations for a pluralist approach to economic development incorporating quality of life and sustainability in ways the neoclassical model has not. It draws from ecological, feminist, institutionalist, and post-Keynesian approaches. We first turn briefly to neoclassical theory and its assumptions and methodology.
