Davide Gualerzi
Consumption and the standard of life

Abstract: Sustainable economic growth is considered a goal in itself by most economists. However, an examination of Mill, but also Marshall and Keynes, confirms that they considered the goal of economic progress a considerably more complex question, one that led them to consider an objective standard of comfort, often associated with the notion of a nobler life. The paper discusses that standard of comfort in relation to two analytical structures, Pasinetti’s structural dynamics and Sen’s capabilities approach. Both are critical of the standard approach to consumption and lay out the basis for a dynamic theory of consumption. That should help to frame the question of an evolving standard of life in the context of long run growth and clarify the meaning of the nobler life envisaged by Mill, Marshall and Keynes. The paper argues that, despite their non negligible differences, structural dynamics and the capabilities approach share fundamental similarities in their approach to growth and development. In particular, their contribution to a dynamic theory of consumption leads to reconsider the notion of need and need development. That, in turn, should bring us close to the concerns behind the notion of an improving standard of life. However, Mill, Marshall and Keynes did not focus on a standard of consumption and its changes, i.e. an evolving material basis for the satisfaction of needs, but rather precisely a “nobler life”, one in which the question of the living conditions of the working classes were addressed as part of a broad view of human progress. That raises a number of interesting questions, such as that of the social philosophy underlying the view of a nobler and its relationship to the wage level.

Keywords: Consumption, growth, standard of life, structural dynamics, capabilities approach.



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