Sustained Growth? The 2025 Nobel Prize and the Evidence Economics Ignores

The 2025 Nobel Prize in Economics celebrates researchers who explained how technology drives "sustained economic growth." But we have overwhelming evidence this growth cannot be sustained.

Why honoring “sustained growth” in 2025 reveals economics’ dangerous blind spot

On October 13, 2025, the Royal Swedish Academy of Sciences awarded the Nobel Prize in Economics to Joel Mokyr, Philippe Aghion, and Peter Howitt “for having explained innovation-driven economic growth.” According to the prize committee, these laureates showed “how new technology can drive sustained growth” and demonstrated that “this is the basis for sustained economic growth, which results in a better standard of living, health and quality of life for people around the globe.”

The word “sustained” appears five times in the brief press release. Each use rings with confidence about humanity’s capacity for endless expansion. There’s just one problem: we have overwhelming evidence that this model of growth cannot be sustained. The data isn’t ambiguous. The science isn’t uncertain. We’re not talking about contested predictions—we’re witnessing measured reality.

What “Sustained” Actually Means

The Nobel committee uses “sustained” to mean self-perpetuating—a mechanism by which technological innovation generates continuous economic expansion, breaking the historical pattern of stagnation. They’re celebrating an explanation of how the last 200 years happened, not examining whether it can continue.

This is like giving an award in 1910 for brilliantly explaining the physics of how the Titanic can stay afloat, while ignoring that it’s already taking on water.

The Evidence We’re Ignoring

The Original Warning: Limits to Growth (1972)

Fifty-three years ago, a team led by Donella Meadows at MIT published The Limits to Growth, commissioned by the Club of Rome. Using the World3 computer model, they examined five variables that determine and ultimately limit growth: population, industrial production, food production, resource consumption, and pollution.

Their conclusion was unequivocal:

“If the present growth trends in world population, industrialization, pollution, food production, and resource depletion continue unchanged, the limits to growth on this planet will be reached sometime within the next one hundred years. The most probable result will be a rather sudden and uncontrollable decline in both population and industrial capacity.”

Critics dismissed the work as alarmist. Economists argued that human ingenuity and technological innovation would always overcome resource constraints—a perspective known as “cornucopianism.” The report was systematically misrepresented, with opponents claiming it predicted specific dates for resource exhaustion (it didn’t) and ignoring its core message about system dynamics and overshoot.

The Uncomfortable Validation

Here’s what’s stunning: the original model’s predictions have tracked reality with disturbing accuracy.

In 2008, physicist Graham Turner at Australia’s CSIRO compared thirty years of real-world data against the Limits to Growth scenarios. His finding? The “business as usual” scenario—which leads to collapse in the 21st century—matched actual developments most closely.

In 2021, Gaya Herrington, then Director of Sustainability Services at KPMG, published an updated analysis in Yale’s Journal of Industrial Ecology. Using data through 2020, she found that empirical evidence continued to align most closely with the Business as Usual 2 (BAU2) scenario—which shows decline beginning around 2030.

Most recently, in 2024, a team led by Arjuna Nebel recalibrated the entire World3 model with the best available contemporary data. Published in the Journal of Industrial Ecology, their work concluded: “The fact is that the recalibrated model again shows the possibility of a collapse of our current system. At the same time, the BAU scenario of the 1972 model is shown to be alarmingly consistent with the most recently collected empirical data.”

The Meadows team didn’t predict some distant hypothetical future. They created a model of the system dynamics of exponential growth on a finite planet. And the data shows they got it right.

The Planetary Boundaries: Quantifying What We’ve Already Broken

While the Limits to Growth work focused on system dynamics, the planetary boundaries framework—developed by Johan Rockström and colleagues at the Stockholm Resilience Centre—provides specific thresholds for nine critical Earth system processes.

The 2023 update, published in Science Advances, quantified all nine boundaries for the first time. The 2025 update confirms an accelerating deterioration of the situation with 7 out of 9 planetary boundaries breached and our ecosystem more than ever in unsafe territory.

The Stockholm Resilience Centre is clear about what transgressing these boundaries means: “Crossing boundaries increases the risk of generating large-scale abrupt or irreversible environmental changes.” They emphasize that “planetary boundaries are interdependent”—we cannot consider them in isolation because “only by respecting all nine boundaries can we maintain the safe operating space for humanity.”

What the Nobel Prize Actually Celebrates

To be clear: the laureates’ work is probably sophisticated and valuable. Very few among us have the level of mastery needed to assess it, especially in a discipline that is as much science as it is a construct built atop beliefs and a set of political and philosophical axioms. Some examples: the rationality of economic agents vs behavioral bias, the obsession of financial returns, efficiency and performance vs the mission to sufficiently satisfy human needs, the qualitative equivalence of equal quantities of individual and collective work vs differentiated value for work of collectives vs solo player, the assumption of separation from biosphere vs the view that the economy is a subsystem of the larger system called Earth… etc

Understanding the mechanisms of innovation-driven growth matters. Mokyr’s historical analysis of how scientific understanding enables cumulative technological progress is important. Aghion and Howitt’s models of creative destruction illuminate real dynamics in market economies.

But celebrating this work in 2025—with the framing of “sustained growth” as humanity’s great achievement—is at the very least misguided. The Nobel committee’s statement reveals the discipline’s foundational blind spot. They write: “Technology advances rapidly and affects us all, with new products and production methods replacing old ones in a never-ending cycle. This is the basis for sustained economic growth, which results in a better standard of living, health and quality of life for people around the globe.” (sic)

Notice what’s absent: any acknowledgment that this “never-ending cycle” operates within a finite biosphere. No mention of the material throughput required for technological innovation. No recognition of the waste streams, the resource depletion, the ecological disruption that accompanies every cycle of creative destruction.

The committee even acknowledges history: “Quite the opposite—stagnation was the norm throughout most of human history.” This is presented as a problem we’ve solved, not as the baseline condition of an economy operating in the pre-industrial reality.

The Thermodynamic Reality Economics Ignores

Here’s the uncomfortable truth that economic models consistently exclude: you cannot have infinite material throughput on a finite planet. This isn’t ideology—it’s physics.

Every cycle of creative destruction requires energy and materials as inputs and generates waste as output. Innovation doesn’t transcend these constraints; it merely shifts which materials we extract and where we dump the waste. Replacing fossil fuels with renewable energy doesn’t eliminate the need for rare earth elements, lithium, copper, and the massive infrastructure to deploy them. Creating digital economies doesn’t dematerialize growth—it requires data centers, semiconductors, and electricity generation at scale.

Nicholas Georgescu-Roegen, one of the rare economists who saw the dependency of the economy on natural resources and the broader environment, often considered to be the founder of ecological economics, explained this in 1971 with the second law of thermodynamics: economic processes inevitably increase entropy. The “sustained growth” the Nobel committee celebrates is thermodynamically impossible as a permanent condition.

The planetary boundaries framework quantifies exactly this reality. We’re not approaching limits in some distant future—we’re already deep in overshoot on six of nine critical thresholds.

What Sustained Actually Means

If we’re going to use the word “sustained” seriously in 2025, we need to ask: sustained for whom? For how long? And at what cost?

The growth of the past two centuries has been “sustained” only in the narrowest temporal sense—a 200-year pulse of expansion fueled by fossil energy and enabled by treating the planet as a free waste dump. This is not sustainability; it’s liquidating natural capital and calling it income.

Real sustainability means operating within planetary boundaries. It means recognizing that the economy is a subsystem of the biosphere, not the other way around. It means understanding that technology is a tool for human purposes, and if our purpose remains endless material expansion, our tools will serve that suicidal goal efficiently.

The Limits to Growth authors wrote in 1972: “The challenge of overshoot from decision delay is real, but easily solvable if human society decided to act.” They were offering a choice.

Fifty-three years later, with seven planetary boundaries transgressed and the evidence of overshoot overwhelming, the economics profession is still celebrating the mechanisms that got us here.

As written in a previous article, on October 13 1307, French King Philippe Le Bel thought he’d made a gain by seizing the assets of the Templars. In an analogous way of thinking, the Nobel committee seems to believe innovation has solved scarcity. Both ignore the systematic destruction of the commons on which everything else depends.

The door is closing. The veil is descending. The dialogue between economics and ecology—between our theories of prosperity and the biophysical systems that enable life—is ending. We (still) have a choice: preserve the commons, or suffer the chaos and destruction that follows their demise.

Sources:

Richardson, J., et al. (2023). “Earth beyond six of nine Planetary Boundaries.” Science Advances, 9(37).

Herrington, G. (2021). “Update to limits to growth: Comparing the World3 model with empirical data.” Journal of Industrial Ecology, 25(3), 614-626.

Nebel, A., et al. (2024). “Recalibration of limits to growth: An update of the World3 model.” Journal of Industrial Ecology, 28(1), 87-99.

Meadows, D.H., Meadows, D.L., Randers, J., & Behrens, W.W. (1972). The Limits to Growth. Universe Books.

Meadows, D.H., Randers, J., & Meadows, D.L. (2004). Limits to Growth: The 30-Year Update. Chelsea Green Publishing.

Turner, G. (2008). “A comparison of the Limits to Growth with thirty years of reality.” CSIRO.

Georgescu-Roegen, N. (1975). Energy and Economic Myths. Southern Economic Journal, 41(3), 347–381. https://doi.org/10.2307/1056148

Stockholm Resilience Centre. (2023). “Planetary Boundaries.” Available at: https://www.stockholmresilience.org/research/planetary-boundaries.html

Stockholm Resilience Centre. (2025). Planetary Health Check 2025, available at: https://www.planetaryhealthcheck.org/#reports-section

The Royal Swedish Academy of Sciences. (2025). “The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2025.” Press release. Available at: https://www.nobelprize.org/prizes/economic-sciences/2025/press-release/