How can economies achieve economic growth without causing negative environmental externalities? There are two aspects to the long-standing debate on ‘sustainable growth’. A first-best solution is for economies to replace fossil fuels with renewable energy sources, mitigating carbon emissions. A second-best solution is to also adopt efficient waste management, recycling residual waste and pollutants (including hard-to-abate carbon) from production (circular economy). We establish a simple growth model that integrates three fundamental pillars of economics: (i) the net zero carbon target in environmental economics (ii) the circular economy, dealing with waste management in resource economics, and (iii) sustainable growth, in growth economics. We argue that growth, circularity and net zero emissions present a trinity of solutions to the sustainable growth problem, showing that the circular economy is a necessary condition for achieving net zero. We show that an economy with ‘active’ environmental policy achieves net zero faster than one with ‘passive’ policy, and also eliminates carbon emissions.

中文翻译：

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三难困境还是三位一体？经济增长、循环经济和净零排放的纽带


经济体如何在不造成负面环境外部性的情况下实现经济增长？关于“可持续增长”的长期争论有两个方面。第一个最佳解决方案是经济体用可再生能源取代化石燃料，以减少碳排放。第二好的解决方案是采用高效的废物管理，从生产中回收残留废物和污染物（包括难以减少的碳）（循环经济）。我们建立了一个简单的增长模型，该模型整合了经济学的三个基本支柱：（i） 环境经济学中的净零碳目标 （ii） 循环经济，在资源经济学中处理废物管理，以及 （iii） 增长经济学中的可持续增长。我们认为，增长、循环和净零排放是可持续增长问题的三位一体解决方案，表明循环经济是实现净零排放的必要条件。我们表明，采用“主动”环境政策的经济体比采用“被动”政策的经济体更快地实现净零排放，并且还可以消除碳排放。