Can degrowth deliver social wellbeing within ecological limits? Dynamics and interactions of degrowth policies in Sweden using iSDG simulation modelling

In response to growing critiques of the economic growth-centered model of development, post-growth approaches have been suggested as having potential to address various social-ecological crises. However, key uncertainties remain regarding the inner dynamics of such a society and the transition towards it; degrowth policy proposals often lack precision and depth, and do not sufficiently consider interactions. Yet policies do not exist in isolation, and their synergies, trade-offs, and unintended consequences need to be investigated. This study explores, through modelling, the potential of degrowth policies to achieve rapid reductions in environmental degradation whilst enabling high social wellbeing. Examples of policies that are explored in the model environment are production taxes on returns on capital, capital decommissioning, universal basic income, work time reduction, and maximum incomes. The research is grounded in a two-fold case study: Sweden as a high-income country where degrowth policies are appropriate, and the Integrated Sustainable Development Goals (iSDG) model as a system dynamics-based policy simulation tool designed to assess the impacts of various policy scenarios at a national scale. The results provide insights into the potential causal dynamics of these policies and show that they all cause trade-offs when implemented in isolation; they improve some social or ecological variables at the cost of others. However, when applied as a coherent package they appear effective in achieving social-ecological prosperity. In the model, combining a downscaling of production with reduced working hours and redistribution of wealth leads to rapid reductions in environmental pressures whilst eradicating poverty and reducing inequality and unemployment. Although there is a risk of misrepresenting degrowth policy dynamics because they are placed in a model context based on current economic structures, the results of this study highlight that some degrowth policies have the potential to succeed even if deeper structural changes have not yet taken place.