Is Decoupling GDP Growth from Environmental Impact Possible?

Today's lesson is from Is Decoupling GDP Growth from Environmental Impact Possible? (h/t mt), by James D. Ward , Paul C. Sutton, Adrian D. Werner, Robert Costanza, Steve H. Mohr, Craig T. Simmons; October 14, 2016 And here is their abstract.

The argument that human society can decouple economic growth—defined as growth in Gross Domestic Product (GDP)—from growth in environmental impacts is appealing. If such decoupling is possible, it means that GDP growth is a sustainable societal goal. Here we show that the decoupling concept can be interpreted using an easily understood model of economic growth and environmental impact. The simple model is compared to historical data and modelled projections to demonstrate that growth in GDP ultimately cannot be decoupled from growth in material and energy use. It is therefore misleading to develop growth-oriented policy around the expectation that decoupling is possible. We also note that GDP is increasingly seen as a poor proxy for societal wellbeing. GDP growth is therefore a questionable societal goal. Society can sustainably improve wellbeing, including the wellbeing of its natural assets, but only by discarding GDP growth as the goal in favor of more comprehensive measures of societal wellbeing.

Focus, dammit!

Oh, but before we focus, notice the picture, which is a Sign of Spring: a crocus. Not only that, it is one that I didn't even plant and has just grown up. How lovely. We now return you to your focus.

The first irritation about this is that they are mixing up two things. The first - GDP growth decoupled from environmental impact - may or may not be sensible. The second - is GDP a good measure of societal wellbeing - is a totally different question. Arguably, if their answer to the second - that GDP is a poor measure - then all their arguments over the first point are irrelevant. The second is also a commonplace that all right-thinking people agree on, and then proceed to totally ignore in the absence of better idea.

The Limits to Growth

The introduction thoughtfully includes:

The Limits to Growth was a seminal work that warned of the consequences of exponential growth with finite resources. The World3 models underpinning the Limits to Growth analysis were validated using actual data after twenty and thirty years. A further independent evaluation of the projections of the World3 models showed that our actual trajectory since 1972 has closely matched the ‘Business as Usual’ scenario. Increasing recognition of the causes and consequences of climate change have generated a great deal of doubt regarding the feasibility of simultaneously pursing economic growth and preventing and/or mitigating climate change. Contemporary work in this broad area of assessing anthropogenic impact on the planet suggests that several ‘Planetary Boundaries’ have been crossed.

I say "thoughtful" of them because by introducing LTG, and making it clear they're on the pro-LTG side, they immeadiately enable all the people who have made up their minds about LTG to predispose to either like or ignore the current paper. My own view is that LTG's assumption of exponentially increasing consumption and lower-order increasing resources essentially assumes the conclusions but wraps this assumption up in enough modelling and maths that those who can't see though it will miss the assumption.

And... by the time we hit the current paper's equation 5 we're at a similar point. Impacts are (exponentially increasing) * (technology), and technology is written as (floor + other_bit * exponentially decreasing). Oh well. There's more after that but I don't think it matters.


They say

The decoupling debate itself is polarized with a preponderance of neo-classical economists on one side (decoupling is viable) and ecological economists on the other (decoupling is not viable).

That sounds about right, but when talking about actual economics I'm not sure that "ecological economists" are to be trusted. To evaluate and project impacts of GW, or human activity, then yes we need ecologists.


Similar evidence to that in Fig 1, showing apparent decoupling of GDP from specific resources, has been shown throughout much of the OECD [28]. However, there are several limitations to the inference of decoupling from national or regional data. There are three distinct mechanisms by which the illusion of decoupling may be presented as a reality when in fact it is not actually taking place at all: 1) substitution of one resource for another; 2) the financialization of one or more components of GDP that involves increasing monetary flows without a concomitant rise in material and/or energy throughput...

It isn't clear to me why substitution of a (presumably less impactful) resource is "illusion". And poit 2 reads suspiciously like the idea that GDP growth that is "only in financial terms" isn't "real" GDP growth, which I think is meaningless. They don't justify what they say themselves, devolving that on a "colleague"; I'm unconvinced.


* Economics and Climatology?
* On getting out more
* Politics is not rational - VV


More like this

Remember disaster recovery and reconstruction is a plus for the GDP numbers. So all the work we need to do cleaning up the intertidal-to-be is positive for GDP. Plus the added value of all the newly clean oyster beds where the view lots used to be.

I hope you can find some ecological economists somewhere you'd think trustworthy. It'd be interesting to read more here.

[The problem I have with EE is that if in gaining the "ecological" they lose their "economist" then they become uninteresting on the subject -W]

By Hank Roberts (not verified) on 21 Feb 2017 #permalink

>"It isn’t clear to me why substitution of a (presumably less impactful) resource is “illusion” "

I think they are suggesting substitution of a measured natural resource by an unmeasured natural resource and the effect on the unmeasured resource could be worse.

This might amuse you:

... Yes, there are hardships, but as long as those
hardships are someone else's, we don't care.

As it stands, society surrenders to capital most decisions about resource
allocation, and capital naturally acts in its own best interests. That is
the problem.

(2) The assumption that `jobs' are the only way to allocate resources is
false. It derives from another false assumption, that the wealthy are
morally entitled to all profits, interest, and rents. People blindly believe
that the wealthy—who acquired their wealth from the labours of the
working class in the first place—are `trapped' due to economic
circumstances into unfortunate decisions that require job
destruction. Nowadays, in our culture, people believe in the positive
morality of interest (formerly, `usury') and profits and rents as surely as
they once believed in the divine, inherited right of kings to rule over the
lesser folk. These `rights' of the upper class, the owners, and the
privileged have no basis in science or honest reasoning.

There is plenty of work to be done, and there is plenty of wealth to feed,
clothe, and shelter everyone, but with all of our immense knowledge we can
think of only one way to address both issues: jobs offered by capitalists on
the condition that they enable the capitalists to maximize their own
accumulation of surplus value. Capitalists and landlords

By Hank Roberts (not verified) on 21 Feb 2017 #permalink

I fail to understand why such a morally confused paper is worthy of a post...

Oh yes, moral philosophy is the ancient name for logic
In case one has forgotten or had an inferior education.

By David B. Benson (not verified) on 21 Feb 2017 #permalink

Sorry about your education Mr. Benson, but moral philosophy = ethics, not logic.

With respect to energy (which is the main current ecological impact) there are fairly obvious limits to per person usage; you can only use so much hot water, drive so many miles, have that many fridges; heat/cool your house to a certain temperature. These physical limits constrains the amount of energy you can realistically use, no matter what the size of the financial economy as measured by GDP. This is why industrializing countries show a near-logistic curve in energy use with rising GDP; once everyone has a car, central heating/aircon, refrigeration and hot water, additional energy use from more stuff is minor.

The logic of energy use increasing in lockstep with GDP is that people are driving further and further, using more and more hot water, cooking more meals, buying and using more fridges, turning the central heating up exponentially.. essentially, raising their consumption of energy intensive stuff in lockstep with income even when it makes no sense, and despite plenty of evidence that poor people spend proportionately more on energy than the rich.

In short, their graph showing a developed country (Germany) being fairly well decoupled and a developing country (China) being coupled is completely expected and normal.

By Andrew Dodds (not verified) on 22 Feb 2017 #permalink

William: Decoupling is an illusion because it violates thermodynamics, by assuming that there is zero net entropy cost of the added economic activity. Perpetual motion by any other name.

G -

If your additional economic activity has a very low energy usage, whilst at the same time incremental efficiency improvements are made in existing activity (i.e. exactly what we have seen in the west for the past few decades), then it is absolutely possible to increase GDP without increasing energy consumption.

It's only an impossibility if you assume that all elements of GDP have identical energy/resource footprints, which is trivially false.

By Andrew Dodds (not verified) on 22 Feb 2017 #permalink

(Rats!, my Return/Enter key failed again (it happens often on this site for some odd reason) so the above got posted prematurely. Now it's working again.)

Picking up where I left off:

The best that can be expected is a very small increment of entropy per transaction. But even a small increment, in a growth paradigm, is an exponential number. And as we all know, exponential numbers are dangerous.

Eventually the total impact of growth of those transactions reaches the same level as would obtain for growth of conventional transactions. The fact that this occurs "later" only pushes back the day of reckoning, where we're back to an unsustainable economy.


The "solution" of increasing financialization and monetization, is a dystopian nightmare from hell, creating a monster that would eventually eat every form of human interaction.

Friendship would become "peer support services." Parenthood would accrue debt by the offspring, to be repaid after they've finished paying off their usurious student loans. We could have auctions for organ transplants, and auctions for votes in elections.

All of our relationships could be further monetized by substituting robots and AIs for old-fashioned human family and friends, via the ubiquitous mobile devices. Bots would offer "friendship" and even "love" in exchange for so-and-so-many additional virtual purchases, such as "in-game objects" for kids, and "virtual adult adventures" for grownups.

After all, what are humans for, other than to press the Buy button or say "Yes" on command? (What are pigeons for, other than to peck at the buttons in their Skinner boxes?)

Hopefully you see the problem here.

The bottom line is that any economic system that depends on growth, will fail once it hits the limits to growth. You can't map an infinite plane onto the surface of a Euclidean solid in Einsteinian fourspace.

We could retain a private-sector-based economy with zero net growth. By definition that wouldn't be capitalism. It would be thoroughly cut-throat, as the success of any new venture would depend upon the failure of an existing one.

Or we could do the really smart thing. The name for it begins with the letter S.

Andrew, you still haven't solved the problem.

I do not assume that all transactions have the same entropy cost or ecological impact.

You can lower the footprint of set A of existing transactions, but there is none the less an absolute floor level for each such transaction. Once you reach that floor, there is no more "lowering" possible, unless you believe in "over-unity devices."

You can have a minimal-footprint set B of new transactions with minimal unit impact, but over time, growth in the number of units of set B will add up to a level of impact that is the same as would obtain for set A at an earlier stage.

There is no escaping this.


Frankly I'm at a loss to understand how or why "growth" has become some kind of deity that must be served at all costs. It reminds me of the way substance abusers rationalize their addictions.

The writing is on the wall, as clear as can be: we are in a state of substantial overshoot, climate change is the irrefutable proof, and the consensus of climate scientists is that this state of affairs is a very real existential threat to the species.

By analogy, that's your doctor telling you that if you don't stop drinking, you are going to destroy what's left of your liver and drop dead. You can keep rationalizing and keep drinking until it kills you, or you can stop. Which will it be?

G -

I look at the real-world data. Such as that showing no increase in per-capita energy use in the UK since 1960(!). I'm not exactly convinced that economic growth per se is a problem.

Extrapolating exponential functions for long periods without considering the underlying system.. that will give problems. However, I don't see physical (as opposed to monetary) economic growth as being exponential.

Overshoot.. I'm not convinced. The Earths carrying capacity for humans is technology-dependent; if we assume hunter gatherer tech then we overshot centuries ago, but if we assume plausible future technology we'd have planet of space.

By Andrew Dodds (not verified) on 22 Feb 2017 #permalink

GDP is a measure of value added. Is it necessary to use more resources to add more value?

No - we can and do design technologies which add more value while using fewer resources.

Resources are thus not the hard limit to possible GDP. Knowledge of how to add value is.


This leaves entirely open the possibility that it might not work out that way, that we will find ourselves constrained in our ability to add value by resource constraints. That is, it is not certain that decoupling will occur. And whether it will is an interesting question.

But that it is possible is absolutely certain. Simply because GDP is a measure of value creation, not resource use.

This is exactly the same as Herman Daly's distinction between quantitative and qualitative growth. Standard neoclassical economics is saying precisely the same thing as the High Priest of ecological economics. We all agree, unlimited quantitative growth isn't possible. Qualitatitive? That depends upon knowledge.

By Tim Worstall (not verified) on 22 Feb 2017 #permalink


Oh, but before we focus, notice the picture, which is a Sign of Spring: a crocus.

As you travel through life, take time to focus on the crocus.

By Mal Adapted (not verified) on 22 Feb 2017 #permalink

After all the stories Dr Connolley told us I hate to say it, but I fully agree with Tim Worstall.

Let's simply make sure our environment stays good or improves following the democratic wishes of the population. We will see if human ingenuity is capable of producing more wealth without ignoring environmental impacts. I am optimistic we can. But such technological, social and organisational advances/changes are not something that is scientifically knowable in advance.

By Victor Venema … (not verified) on 22 Feb 2017 #permalink

It is hard to believe that people are seriously arguing that in any time frame that matters, there are any significant limits to growth. Julian Simon has proved again and again that human knowledge (which is increasing exponentially) outpaces resource scarcity. I think the appropriate phrase from a fairly recent post of yours is: "Mundus vult decipi, ergo decipiatur."


I want a world with massive increases in energy per capita. CO2-free, of course. Insect-killing robots for agriculture that pick them off by pincer. Megawatts to isolate and pump CO2 and waste deep into the subduction zones. Massive kilns for limestone to seed the oceans with calcium and smaller amounts of iron. Free family-planning clinics everywhere.
More energy. Electric trains and cars. More! Energy-intensive recycling; deactivation of toxic wastes.

With massive increases in energy, growth without population increase is do-able.

By Russell the Stout (not verified) on 22 Feb 2017 #permalink

human knowledge (which is increasing exponentially)

An interesting assertion. What units is "human knowledge" measured in?

Human stupidity seems to be increasing, as well. Do we measure in the same units as "human knowledge"? Or how do we compare measurements of the these?

Or is it just a decrease in human wisdom? Not an actual increase of stupidity, but rather less wisdom to offset the same old stupidity we have always had? I really don't know.

Limits to growth do exist. We might not see them in advance, however. That would require at least wisdom, which doesn't seem to be increasing.

By Phil Hays (not verified) on 23 Feb 2017 #permalink

Dunc: "What units is “human knowledge” measured in?"

Could be measured in published papers, patents or the amount of information to which people have access to. I was mostly thinking of scientific information when I made my statement. Between advances in computer technology, medicine, genetics, physics, biology, chemistry, agriculture and manufacturing, scientific human knowledge is increasing rapidly. For the last 150 years, at least, it has always outpaced scarcity and continues to do so.

I would also point out that 40 years ago, in order to obtain scientific manuscripts, you had to actually get the paper, which is a much slower process than internet posting and sharing. Additionally, many Chinese and Indian scholars, who would have been out of the loop in the pre-internet area are now able to contribute their expertise. One can quibble over terms, but the fact is that Julian Simon has been consistently more on the correct side of analysis than the Limits to Growth people. Yet in an application of the Mundus vult decipi principle, he, and his work, is ignored and people like John Holdren are appointed to influential positions.


JD: “What units is “human knowledge” measured in?”

What units is "human stupidity" measured in? Is it the number of calls for more and fancier nuclear tipped missiles? Or somehow in the money not spent on dam maintenance? Or the election of evolution, vaccination and climate change deniers?

There are vastly more scientific papers published. There are vastly more junk scientific papers are published. The President states that the press is the enemy of people, so how long will anything at all be published?

If a limit to growth can be identified, and knowledge developed and used to mitigate that limit, then perhaps that limit might not be the limit. That doesn't mean that there are not Limits to Growth. The laws of physics still apply. Human population will be limited long before humans are a solid ball of people expanding at the speed of light. Or have converted all the atoms in universe into people. So what limit to growth will be the actual limit to growth? Not an easy question.

One limit to growth might be social instability. The application of knowledge shifts the basis of economics. Those people that relied on the old economics to put food on the table might very well demand limits to the application of knowledge. How can a coal miner vote for increasing nuclear, solar and wind power? And how can a oil well owner decide to contribute to funding research into advanced energy storage or hydrogen fusion? How can an drilling engineer decide buy an electric car?

Climate change is becoming an example of a problem we have the knowledge to solve, but might not. Or we still might solve this... And blow up civilization with a rain of nuclear bombs. Our path forward will reach stability... the question is what kind of stability do we reach?

By Phil Hays (not verified) on 24 Feb 2017 #permalink

4, 17:
David B. Benson:
"I fail to understand why such a morally confused paper is worthy of a post…

Oh yes, moral philosophy is the ancient name for logic
In case one has forgotten or had an inferior education....
Every moral philosopher needs to study
and further, I hold, .."

Just after the Unabomber was caught, Van Quine's phone rang and a reporter asked if it was true that he had given Kaczynsky an A in modal logic.

"Yes," Quine replied, " but he never took my course in Moral Philosophy."

By Russell Seitz (not verified) on 24 Feb 2017 #permalink

Russell @ #22 --- A gem...

By David B. Benson (not verified) on 25 Feb 2017 #permalink

It's not that we live in a world without limits. It's that those limits are not anywhere near us.

By Tom Fuller (not verified) on 25 Feb 2017 #permalink

My air has limited breathability. No limits there.

By Russell the Stout (not verified) on 25 Feb 2017 #permalink

I'll answer this with the old phrase from art: "of course it is possible but there aren't enough fans of cubists."

I think it's still valid, though nowadays you need to count in minecraft.

#24 Limits.

I'm glad you don't see any limits we are close to. I'd guess that the Anasazi in Long House Valley would have been similarly optimistic. Best case, they might have been correctly optimistic, for perhaps another doubling of population. What happened to them next wasn't best case.

We rely on food grown around the world. There is some potential expansion in crop area. We can cut down more of the Amazon forest to grow soybeans as an example. We do have headroom available by shifting of diet. Much of pig and other livestock food we could eat, but might not like as much as bacon. Such as grain sorghum, soybeans, etc.

If food production drops now, we can change diet and survive. So best case I agree.

What if the future isn't best case? What about after we double human population and are farming almost every square meter of available land? What if we quadruple human population and farm everything as well as shifting diet to mostly vegetarian? How much margin is left?

The closer a society gets to the limits, the less robust it becomes.

The much smaller Anasazi population in 900 AD might well have survived the great drought, at least according to the paper above.

By Phil Hays (not verified) on 26 Feb 2017 #permalink

I tend to think of 'decoupling' as a direction: reduced environmental impact per unit of production.

If you think of decoupling as economic activity leading to zero environmental impact, you've defined the concept to be totally useless. Either you've defined economic gain in a way that has no physical realization, or you've made it impossible to decouple without violating the laws of thermodynamics.

By numerobis (not verified) on 26 Feb 2017 #permalink

Phil -

Luckily, most projections see population stabilizing, at perhaps 50% greater than now. The rate of increase keeps dropping, and urbanization (which seems to automatically drop family size) increasing.

In theory, if we can bring our accumulated and plausible near future scientific knowledge to bear, then there is no barrier to having a world of 10 billion people living a 1st-world lifestyle or better.

The key word being 'if''. There are many problems that require the registering of scientific reality (i.e. Global warming) and/or require things like central planning - both of which run into significant opposition from various ideologically motivated groups. Politics may push us into a corner without escape.

By Andrew Dodds (not verified) on 27 Feb 2017 #permalink

So, ah ...
How about decoupling _CO2_ growth? Any possible way?
A negative examples collection:
The Climate Deregulation Tracker monitors efforts undertaken by the Trump administration to scale back or wholly eliminate federal climate mitigation and adaptation measures. The tracker also monitors congressional efforts to repeal statutory provisions, regulations, and guidance pertaining to climate change, and to otherwise undermine climate action. Finally, the tracker monitors any countervailing efforts to advance climate change mitigation and adaptation.

Check the website for previous updates, as well as related news items (such as executive and congressional actions with indirect implications for climate change, and updates about federal agency appointments).
----end quote-----

By Hank Roberts (not verified) on 04 Mar 2017 #permalink