Growth imperative in modern economies is a hidden rule that forces everyone to chase bigger output or face decline otherwise. Competition, innovation, and social expectations turn growth from a choice into a necessity, across governments, firms, households, and even at the individual level.
Paper: Growth imperatives: Substantiating a contested concept
Why do even successful companies feel restless? If a successful mid-sized phone maker skips the next big upgrade, its competitors will take its customers, and its workers will start to leave. The company must pour earnings back into research and bigger factories just to stay in place.
Growth imperative is a fundamental principle embedded in modern capitalist economies, describing the systematic necessity for continuous economic growth.
The phone maker example demonstrates the growth imperative at the firm level. At the micro level, households feel a similar pressure. A worker must buy a laptop and better internet to keep a job that demands remote meetings. Falling behind on these efficiency purchases can risk unemployment or social exclusion.
At the macro level, governments must chase more output new industries, and ever-faster innovation to protect employment and social stability because, each year, rising labor productivity means the same tasks need fewer people. Without matching economic growth, jobs vanish and tax revenue drops, straining welfare budgets.
Across all three levels, the same pattern appears: survive by expanding resource use and capital or face existential costs.
Potential solutions to the growth imperative include degrowth, although I have yet to see a clear implementation path."
Some people also apply the growth imperative at the personal level. Bill Bain, founder of one of the most prestigious consulting firms in the world Bain & Company, introduced Morris Chang to the Experience Curve concept at Boston Consulting Group (BCG).
When leaving BCG in 1973, resigning as vice president to found Bain & Company, Bain was asked by Morris Chang why he wanted to leave. Bain replied: "We all have a growth imperative".