Businesses clearly have a major role to play in any strategy for saving the planet. They are the engines of the developed economies that devour a disproportionate share of the world’s nonrenewable resources and produce a disproportionate share of its emissions. They also generate innovations that reduce resource use and lessen pollution. As both a cause of and a solution to environmental degradation, they are inevitably at the centre of sustainability debates.
But how, exactly, can businesses contribute? According to one line of reasoning, rescuing the environment involves restraint and responsibility: Consumers and companies must do more with the resources they consume, recycle and process their waste more efficiently, and curb their appetite for consumption. In short, resources are finite and need to be carefully husbanded—an argument that appeals directly to the traditional virtue of moderation. This worldview achieved perhaps its clearest expression in the works of the 19th-century economist Thomas Malthus, who feared that at prevailing population growth rates the planet would eventually be unable to feed itself.
Although the Malthusian view exercises a powerful influence on voters and politicians alike, it is by no means uncontested. Another line of reasoning, which flows from the work of the 20th-century economist and Nobel Prize winner Robert Solow, is that environmental and other problems can always be resolved through the exercise of human ingenuity. This view appeals to our natural optimism and underlies much advocacy for deregulation and the promotion of growth.
It’s not hard to see why these two philosophies make uneasy bedfellows. Yet if we are to achieve real progress in solving the world’s environmental problems, we will have to apply both of them.
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