Do we need degrowth? Can we save the climate while improving the economy?

There is a common intuition that says we can have a healthy climate, or a growing economy, but not both.

Economic activity, as long as it is fueled by fossil fuels – which still provides about 80 percent world energy – creating greenhouse gas emissions. So it seems to follow that if we want to emit fewer greenhouse gases, we have to make some sacrifices economic growth, though raising average income levels is a key part of reducing poverty.

This creates a terrible dilemma, because fighting climate change and fighting poverty are very important goals. As developing countries explained at the COP27 climate summit that took place in Egypt, We really don’t want to change any of it.

Fortunately, we may not have to.

The proof comes from more than 30 countries who have achieved what is known as “absolute decoupling.” That means they already know how to reduce carbon emissions while continuing to grow economically, so those goals are not compatible. Note that this is not just a per capita measure; We are talking about total emissions and total economy here.

More in Our world is in DataResearcher Max Roser created a great chart showing 25 countries that have pulled off this feat in the past few decades.

When you see that, you might think: What about the fact that many countries are moving their carbon-intensive industries to other countries, which are often poorer, and then importing their goods? Of course, this chart does not capture everything that is outsourced production on account!

In fact, it is. Shown in the chart are consumption-based emissions, meaning emissions caused by goods produced outside the country but consumed within it.

Our world is in Data

The obvious question here is: How can these countries decarbonize as much as they do without lowering economic growth?

Many factors have made this possible, including technological advances on cheaper fuels and new regulations on air pollution, which have allowed countries to reduce the greenhouse gas intensity of their economies – The amount of carbon embedded in every economic buck. Another key part of the picture is putting a price on carbon, so those who cause emissions have to pay. Carbon pricing is based on a simple idea – if the price of a product goes up, consumption goes down – and it turns out to be very effective in countries like Sweden, Germany, and England.

The countries in the chart show that there should be no tradeoff between reducing emissions and improving the economy, because many economists and laymen once considered. And it’s not just that emissions reduction policies aren’t fundamentally hostile to the economy. In fact, this policy can actually increase economic growth in the coming decades. Investing in climate change mitigation now means we have to spend less in the future – to rebuild after fires and floods, to deal with premature deaths and lost productivity caused by them, and more.

That means, as Roser puts it in Our World in Data, “Fighting climate change is not only compatible with fighting poverty, the two goals – to reduce emissions and increase economic growth – are actually the same. strengthen each other.”

Or at least, they can, with the right policies.

Leave a Reply

Your email address will not be published. Required fields are marked *