34 Chapter 2 Economics Without Growth Giorgos Kallis Introduction The early twenty-first century poses a different set of challenges to economics than the late nineteenth and early twentieth centuries, when the premises of current orthodoxy were founded. Then the core question was how to achieve growth; now it is how to manage and prosper without growth (Victor 2008; Jackson 2011). Then the ques- tion was how to produce wealth (Smith 1887); now it is how to live with enough (Skidelsky and Skidelsky 2012). Developed economies find themselves in a unique constellation of: stagnation, for the first time since the Second World War (Summers 2013; Piketty 2014); ecological thresholds, especially catastrophic climate change, all but unavoidable if the global economy continues to grow at its current pace (Jackson 2011); and rising inequalities, accentuated by stagnation and the “neoliberal” turn (Harvey 2011; Piketty 2014). Growth is unsustainable, but degrowth is socially unstable in capitalist economies (Jackson 2011). A new economics therefore has to inform the question of how to make degrowth stable while reducing inequalities. Standard economic models are inadequate for engaging with these questions. Their pre-analytic simplifications are partly derived from normative concerns of the past. The standard Solow growth model, for example, was designed to explain the origins of growth. Growth was attributed to the accumulation of capital and to the technological progress that drives productivity. Economists after Solow broke the productivity part down to human and social capital, energy produc- tivity, or the quality of institutions. To reverse this and claim that M4100 CASTELLS TEXT.indd 34 07/10/2016 13:04