Do we need economic growth?

You will surely wonder why we need constant economic growth. Of course, this cannot be explained in a few words. First of all it must be explained how the growth of the business is measured at all.

This is how economic growth is measured

• In order to be able to measure economic growth at all, corresponding data must of course be available. To do this, the Federal Statistical Office calculates the so-called gross domestic product. Gross domestic product is a measure that all in Germany contains manufactured goods and services.
• However, the calculation is only based on the end products. For example, if the baker sells bread, only the selling price for the bread counts. The revenues for the flour, energy costs and building costs are not determined separately because these are already included in the sales price.
• The gross domestic product is recalculated for each year. If the value increases compared to the previous year, one speaks of economic growth.
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• The economy grows by an average of 1.5% every year. Basically, we don't even need a higher growth rate.


Adequate economic growth - a definition

Almost every day you hear something in the news about inflation, cold progression, ...

What do we need constant economic growth for?

• We need constant economic growth for demographic reasons. The number of young people able to work is falling continuously. This then means that these people have to achieve a permanently increasing productivity.
• If the economy or productivity stopped growing, the current standards could no longer be maintained. That would result in a lower quality of life and also an enormous increase in the price of all goods and services.
• However, constant growth of the economy is also necessary in order to be able to keep up with the hard-fought global competition.

It should be noted that we need permanent economic growth in order to maintain our accustomed quality of life.