Let's talk about the Nobel Prize in Economics and the limits of the planet?

The 2025 Nobel Prize in Economics has once again illuminated an old theme of modern faith: the belief that innovation is the engine of progress. By recognizing economists who have explained, with theoretical refinement and sophisticated data, how technological advancement drives productivity and growth, the award seems to reaffirm a conviction that has survived every crisis—from the dot-com bubble to the 2008 financial collapse, from pandemics to wars: if there are problems, innovation will solve them.

In the spirit of this column — Controversies —it's worth asking whether this trust, as we understand it, still holds up in today's world. Not because innovation has lost its relevance; on the contrary, it's never been more necessary. But because the context has changed. The global economy of 2025 lives under the shadow of ecological limits, climate change, and a pervasive sense that the planet can no longer support the kind of growth we associate with well-being.

Given this, who am I to reject the laureates' ideas? They are solid, fruitful, and beautiful in their internal logic. The question is another: do they answer the questions of our time? Or do we continue to apply a model of reasoning forged in a context of expansion, on a planet that seemed infinite, to a world now discovering its finite contours?

I confess I don't have answers. Science—and good economics—begin when we recognize the limits of our knowledge. What I propose, therefore, is a conversation about what this Nobel Prize celebrates, what it perhaps ignores, and, above all, what we, as a society, need to rethink.

The Nobel and the imaginary of progress

Nobel Prizes often say as much about the present as about the future. With each edition, the committee's choice reveals what the scientific community considers essential to preserve or reaffirm. This year, in awarding Philippe Aghion, Peter Howitt, and Joel Mokyr, researchers who studied the mechanisms of innovation and long-term growth, the message was clear: technological progress remains the main source of human prosperity.

It's a powerful vision that spanned the entire 20th century and shaped public policy, business strategies, and the collective imagination of what it means to "move forward." The central idea, synthesized in countless endogenous growth models, is elegant: innovation destroys the old, creates opportunities, increases productivity, raises income, and stimulates new inventions—and so on, in a virtuous cycle that pushes us forward.

For a long time, models described the trajectory of the Western world well: electrification, antibiotics, agricultural mechanization, computers, the internet, and so on. Each technological leap seemed to confirm that growth was not only possible, but desirable and, in a way, natural.

This narrative, however, has a rarely discussed subtext: that innovation is always positive, that more is always better, and that growth can—and should—be continuous and infinite. Traditional neoclassical economics never concerned itself with the size of the planet because, for centuries, the planet seemed large enough to sustain the dream of unlimited progress.

But the 21st century has begun to test the limits of this belief. As global warming advances, biodiversity loss accelerates, and inequalities become more glaring, an uncomfortable question begins to arise: what if the very logic that brought us here is colliding with the boundaries of possibility?

The 2025 laureates are aware of this tension, but the conceptual framework of their models is that growth is the central measure of success and that it is up to innovation to make it compatible with sustainability. Perhaps it's time to ask whether this compatibility is possible—or whether it is itself a comforting fiction.

When the planet enters the equation

For a long time, economics could afford to ignore ecology. Nature appeared, in classical models, as a generous backdrop: an inexhaustible source of resources and an infinite sink for waste. Growth depended essentially on capital and labor; the planet, that small detail, was left out of consideration.

But the 21st century introduced a variable that doesn't fit well into the equations: planetary boundaries. It's not just the climate that's changing—it's the relationship between the economic system and the Earth system. And suddenly, the old belief in perpetual growth begins to seem like a kind of elegant anachronism: intellectually coherent, but physically impossible.

Voices like Kate Raworth's, with her Donut Economy, Tim Jackson, author of Prosperity without Growth, and Jason Hickel, in Less is More, Ecological realists introduce the planet into the equation. Raworth proposes an economy that operates within a "ring"—between a minimum social floor and a maximum environmental ceiling. Jackson questions the obsession with GDP and argues that thriving is not the same as growth. Hickel goes further: he suggests that the very imperative of growth is the driver of the climate crisis and inequality.

These criticisms reveal that innovation alone does not guarantee sustainability. Because all innovation is ambiguous—it creates solutions, but also new pressures. Electric cars reduce emissions but increase demand for lithium and cobalt. Artificial intelligence optimizes systems but consumes energy on an ever-increasing scale. Biotechnologies promise to reduce agricultural impacts but may further concentrate power over seeds and genetic resources.

The idea of ​​"green growth," which decouples economic progress from resource use and emissions, is seductive, and there is evidence of significant progress. However, so far, initiatives have been limited and insufficient to offset the global rate of degradation. The world is still growing faster than it can decarbonize.

This doesn't mean we should abandon innovation or growth, but perhaps reposition them: instead of ends in themselves, transform them into instruments of prosperity within the limits of the planet. And to do so, we need to rethink what we understand by economic success—and what we expect from innovation itself.

The necessary controversy

Perhaps the most intriguing point of this debate lies not in the disagreements among economists, but in the questions we avoid asking: who does innovation serve? What does it seek to optimize? And how do we measure its results?

The tradition that inspires the 2025 Nobel Prize is based on the premise that innovation and productivity are universal goods—the more of them, the better for everyone. It's a comfortable and, to some extent, true belief: no one would want to forgo the medical, energy, or digital advances that have transformed modern life. But it hides the fact that not all innovation generates well-being and that the distribution of technological gains is profoundly unequal. What we see today is a paradox: never has there been so much innovation, and never have social and environmental tensions seemed so acute. This suggests that we may have succeeded in increasing the efficiency of means, but less so in redefining ends. Innovation has become almost a moral end in itself—a measure of civilizational vitality—even when the results don't translate into better lives or greater balance with the planet.

Economist Mariana Mazzucato has emphasized this point when proposing a vision of innovation guided by public missions: instead of letting the market determine the direction of discoveries, it is up to society to define collective goals—such as decarbonizing the economy, regenerating ecosystems, or universalizing access to care and education. Innovation, in this model, is an instrument, not a dogma.

But this also requires rethinking our metrics. GDP remains the compass of progress, even though it only measures the monetary flow of goods and services, ignoring whether they generate quality of life or environmental destruction. Productivity, in turn, measures how much is produced per hour worked, but it doesn't distinguish whether what is produced brings us closer to or further away from the sustainable future we claim to desire.

Perhaps the real controversy of our time isn't between "green growth" and "degrowth," but between continuing to measure the world with the same yardsticks or inventing new ways to measure what truly matters. As long as incentives remain tied to indicators blind to ecological and human context, innovation will continue to race—but perhaps in the wrong direction.

A possible dialogue

There's no need to choose between technological optimism and ecological skepticism. The challenge is to establish a dialogue between these two worlds—that of innovation, which believes in the human capacity to reinvent the future, and that of ecology, which remembers that the future has non-negotiable physical boundaries.

This isn't a dispute between faith and reason, but between old and new ways of imagining progress. For much of modernity, growth meant producing more, consuming more, and transforming our surroundings more quickly. Today, it perhaps means the opposite: doing better with less, regenerating rather than extracting, balancing rather than accumulating. Innovation remains indispensable—but its role needs to shift: not accelerating what already exists, but redesigning the foundations of what's possible.

The future of innovation—and perhaps its salvation—depends on what drives it. As long as only profit, competition, and consumption drive it, human creativity will remain hostage to a cycle that corrodes the material basis of life itself. But if the drive comes from collective goals—public missions, purposes of regeneration, inclusion, and sustainability—innovation can once again be what it always promised: a tool of hope.

Ultimately, this is what this controversy is about. Not to deny the merit of the winners, but to broaden the horizon of the question: to innovate, yes—but in what direction, and for what reasons? And perhaps this, after all, is the conversation that this year's Nobel Prize—unintentionally—invites us to have.

The conversation we still need to have

The beauty of economics—and perhaps also its pitfall—is believing that the world can be explained by elegant models. But there are times when reality begins to escape the equations, and more imagination is required than calculation. The challenge of the coming decades seems to be precisely this: combining the rigor of economic reason with the humility to recognize that the planet is not an external variable, and that society is not merely the sum of individuals.

Innovation will continue to be essential. But it's time to look beyond just your own as, and yes to yours why e for whomWhat drives us to innovate? The fear of scarcity? The pursuit of profit? The legitimate desire to improve people's lives? Or simply the inertia of a system that has learned to accelerate, even when it doesn't know where it's going?

The most transformative technologies in history were not born of a blind rush, but of an intention: to cure diseases, expand freedoms, connect people, understand the universe. They emerged when drives of innovation were geared towards the collective, and not just individual gain.

I don't think we need to slow down the engine of innovation, but we do need to change the fuel, replace the logic of extraction with that of regeneration, the incentive of scarcity with that of cooperation, and the promise of unlimited growth with shared and sustainable prosperity.

There's no ready-made map for this—and that's exactly why we need to talk. Because, like all good controversy, this is also a form of hope: the hope that we can still choose our path before the road ends.

This text does not necessarily reflect the opinion of Unicamp.

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