a blueprint for a clean economy and healthy society

The Growth Story of the 21st Century: The Economics and Opportunity of Climate Action Nicholas Stern LSE Press (2025)

It is a dark time for climate policy and global affairs. Wars in Ukraine, the Gaza Strip and now Iran, as well as the domestic and international policy and trade agendas of US President Donald Trump’s administration, are diverting attention from efforts to cut greenhouse-gas emissions. Momentum for mitigating climate change is now in retreat, as it was after the 2008 global financial crisis.

Economist Nicholas Stern pushes against that tide in his latest book. The Growth Story of the 21st Century is drawn from lectures at the London School of Economics in 2024 and builds on his earlier works in an attempt to reinvigorate worldwide efforts to limit global warming.

Stern’s 2006 report for the UK government, The Economics of Climate Change, is arguably the most influential work on that topic, both because of its content and the fierce debate that it prompted. The report, and his 2016 book Why Are We Waiting?, pushed the case for immediate and aggressive efforts to reduce greenhouse-gas emissions, based mostly on the argument that it is cheaper to decarbonize than it is to deal with the potentially catastrophic costs of climate change.

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The Growth Story reiterates that point. It also repeats Stern’s critiques of the mainstream economics community, which he argues has oversimplified climate change, downplayed its risks and misleadingly portrayed climate action as being incompatible with economic growth. But the book’s main contribution and focus is on how a new ‘clean’ economy, constructed around sustainability and cooperation, can provide a more efficient, prosperous and healthy society.

The case Stern makes for sustainable development is not new; others have made similar arguments in the past. What sets the book apart is its breadth, accessibility and the practical prescriptions for reform. Rather than hiding behind abstraction, The Growth Story provides a well-defined vision of what sustainable development might look like and how it might be achieved.

Promise of a clean economy

Stern’s vision is laid out in four parts. Part one lays the foundations by introducing sustainable development and Stern’s preferred definition of it: maintenance of physical, human, natural and social capital so that future generations have opportunities that are at least as good as the current generation has. It then describes the existing international climate-policy frameworks and how they have evolved, the basics of climate science and the case for urgent decarbonization.

From there, Stern turns to the history and geography of greenhouse-gas emissions and the ethics and economics of mitigation, before focusing on the factors that provide an opportunity to accelerate climate action. These include rising public concern and youth activism, declining costs of clean energy, the rise of artificial intelligence and increases in innovation and investment.

Part two describes key drivers of growth in the new economy: rapid innovation, increasing investment and returns on clean technologies, more efficient use of resources, stronger productivity (including in transport and energy systems) and improved health. Because of these drivers, Stern argues, rapid decarbonization does not need to involve economic sacrifice. It can usher in more prosperous, vibrant and efficient economies.

To realize this promise, Stern sets out the actions needed to shift the global economy onto this sustainable path and the role of the state in fostering and directing these reforms. Outlined priorities for investment include accelerating the energy transition, helping communities to adapt to and become more resilient to climate-change effects, and preserving and restoring nature. He also discusses the importance of ensuring a ‘just transition’, in which the immediate losers from structural change are looked after.

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Part three is devoted to the international action needed to support the transition to sustainable development. Four priorities are identified: mobilizing finance to support clean-energy investment; the development, transfer and trade of technology; protecting natural capital; and managing the overshoot in global temperatures, including through the use of carbon-removing technologies.

Stern places low- and middle-income countries (LMICs), excluding China, at the centre of his narrative, because they will probably be the fastest-growing economies for the rest of this century. LMICs should play a more prominent part in leading the transition, he argues, because their development path over the coming decades will dictate global climate outcomes.

Part four of the book is devoted to debunking counterarguments and fallacies, and pushing the case for his optimistic vision of the future. “Yes, we can” is the takeaway message.