First define what you mean be growth.
And kind of the opposite question, can an economy grow if consumption always stays at a minimum level needed to survive.
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Growth to me, means the economy's standard of living in increasing. I do not believe an economy can grow if there is no savings, as what is produced would immediately be consumed. Standard of living would remain constant.
If consumption does not grow, thus savings continue to grow larger and larger, I believe the stanard of lving would increase. The basics for life would soon require next ot no energy to maintain and it would pretty much stay there until someone wanted to up their consumption, then production would be diverted to meet that demand. But I am unsure that if consumption does not grow, what happens with savings and investments. It would be correct to say consumption = consumer goods and savings = investment = producer goods, right?
What do you guys feel about this train of thought?
unit4:John, by standard of living I do mean how you explained it. More goods at a less cost. But if there is not any producer goods being bought, then no additional goods will be produced, thus the standard of living stays the same.
So it's basically like I was illustrating...you just had sloppy definitions. (Which appears to be even further illustrated in the conversation of this thread).
Regardless of the definitions used, and regardless of the rate of savings, an economy can grow simply by expanding the division of labor.
Matticus Rex:Regardless of the definitions used, and regardless of the rate of savings, an economy can grow simply by expanding the division of labor.
Really? How do you expand the division of labor without capital accumulation? And how about if we define growth as "an increase in the physical size of the average human in the economy."?
I'd be careful with blanket statements like that.
Human capital can increase without the savings necessary for non-human capital accumulation.
I obviously didn't mean that you could define terms any way you wanted, but that a broad range of potentially logically compatible definitions would easily be satisfied. I suppose you also heckle when someone around you declares their hunger to be great enough that only a horse will suffice. You're that guy.
I'm just saying if the entire issue of the OP is based in sloppy definitions and not being clear on terms, I don't think it makes much sense to just throw out more careless statements to try to answer it.
Half the problem people have understanding a lot of these concepts is not being taught the proper things to begin with, or being presented with sloppy explanations and half-true or sometimes-true axioms that end up causing problems as they confront issues in their discussions and studies later on. But as LeVar Burton always used to say, you don't take my word for it...