In the latest PRIME publication by Dr. Geoff Tily “On Prosperity, Growth and Finance” the author elaborates on an earlier theme: the development of the economic concept of ‘growth’ in the 1960s by orthodox economists. Tily points out that growth is not just a relatively recent and post-World War II preoccupation, it must also be understood as “inherent to the case for a globalized system.”
Tily notes that Keynes was concerned with the level of economic activity – output and employment. Before the Second World War “there was no sense of a systematic, and to some extent uniform, rate of change of the level at which an economy operated.” As orthodox economists struggled to build a rival system to Keynes’s, they set the world “a systematic and improbable target: to chase growth. Nobody seems to have paused to consider whether growth derived as the rate of change of a continuous function was a meaningful or valid way to interpret changes in the size of economies over time” writes Tily.