Income

Another way of thinking about sustainable scale is in terms of income, which can be defined as the amount of something a community can use up without reducing the amount of capital from which it is derived, so that the same amount can be generated in future years.¹ By this definition income is sustainable - the same amount can be generated year after year.

If more income is used up in a year than the capital available can generate, then the amount of capital will decline. Use at this level is no longer income, but depletion, and is not sustainable. It will only be a matter of time before the capital itself declines to zero, at which point there will be no more use. This is true not only for financial capital but also for Natural Capital and Income. When capital can no longer generate the same level of income as it has in the past, the sustainable scale of income used has been exceeded.

References

¹Hicks, J. Value and Capital, 2nd edition. Oxford: Claredon, 1948.