Chart of the Week: Greenery and Prosperity
IMF Blog, May 21, 2018
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- Chart of the Week: Greenery and Prosperity
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Bibliographic details
- Authors: Joo Tovar Jalles, Prakash Loungani
- Published: May 21, 2018
Study scope and methodology
- Analysis covers the world’s top twenty largest GHG emitters from 1990 to the present.
- The chart summarizes the percent increase in trend emissions for every 1 percent increase in trend incomes—reported as elasticities (percent change in trend emissions per 1 percent change in trend incomes).
- Trend measures capture long-run relationships in emissions and incomes, abstracting from short-term dips due to recessions and financial crises.
- Confidence intervals are used to indicate the precision of elasticity estimates; imprecise cases are shown in a lighter shade.
Key findings on decoupling by country groups
- Advanced economies: evidence of decoupling is emerging.
- Germany, the United Kingdom, and France: elasticity estimates are negative — emissions have fallen despite increases in incomes; these countries have achieved decoupling.
- United States, Australia, Japan, and Canada: elasticity estimates are positive but small, between 0.1 and 0.4 — emissions grow at a much slower rate than incomes (no full decoupling yet). In the United States, strong progress since the mid-2000s is attributed mainly to increased use of natural gas for electricity generation.
- Ukraine, Russia, and Italy: point estimates are close to zero but confidence intervals are wide; the relationship between emissions and incomes is uncertain in these cases.
- Emerging market economies:
- Remaining countries in the chart (emerging markets) have elasticity estimates that are all positive and exceed 0.6.
- However, these elasticities are lower than they were in the 1970s and 1980s.
- Related research finds that within countries such as China, richer provinces are beginning to show signs of decoupling.
Interpretation of drivers
- Decoupling in advanced economies is attributed to:
- Active policies aimed at decarbonizing their economies.
- Structural economic transformation toward a greater role for services.
- Specific energy shifts: increased use of natural gas for electricity generation has been a major factor in the United States since the mid-2000s.
Policy implications and recommendations
- Progress on decoupling is real but incomplete; controlling emissions to date may still be insufficient to meet global climate goals.
- The IMF recommends carbon pricing—impose charges on the carbon content of fossil fuels or their emissions—to accelerate progress toward a green world.
Contextual notes
- The analysis highlights positive signs of decoupling in advanced economies while emphasizing that emerging market elasticities remain relatively high.
- Historical perspective: elasticity estimates for emerging markets have declined relative to the 1970s and 1980s, indicating some long-run improvement.
Authors: João Tovar Jalles, Prakash Loungani — May 21, 2018. The IMF is an organization of 191 countries.
Content in this bundle
- 绿色与繁荣; IMF博客； 2018年5月21日
- 環境と豊かさ; ジョアン・トヴァール・ジャーリス プラカシュ・ラウンガニ; IMF ブログ 2018年5月21日掲載
