Decoupling Economic Growth and Energy Use: An Empirical Cross-Country Analysis for 10 Manufacturing Sectors

Abstract

This paper provides an empirical analysis of decoupling economic growth and energy use and its various determinants by exploring trends in energy-and labour productivity across 10 manufacturing sectors and 14 OECD countries for the period 1970-1997. We explicitly aim to trace back aggregate developments in the manufacturing sector to developments at the level of individual subsectors. A cross-country decomposition analysis reveals that in some countries structural changes contributed considerably to aggregate manufacturing energyproductivity growth and, hence, to decoupling, while in other countries they partly offset energy-efficiency improvements. In contrast, structural changes only play a minor role in explaining aggregate manufacturing labour-productivity developments. Furthermore, we find labour-productivity growth to be higher on average than energy-productivity growth. Over time, this bias towards labour-productivity growth is increasing in the aggregate manufacturing sector, while it is decreasing in most manufacturing subsectors.

Decoupling Effect of County Carbon Emissions and Economic Growth in China: Empirical Evidence from Jiangsu Province

“…The increase in the proportion of the tertiary industry inhibited the increase in carbon emissions per capita, which shows that the adjustment of industrial structure is conducive to reducing carbon emissions. This is in line with the ideas that suggest that "structural change greatly promoted the growth of manufacturing energy productivity and led to the decline of carbon emissions (Mulder et al) [16]"; "economic structure adjustment was related to carbon emission reduction (De Freitas et al) [17]"; "The decline of carbon emissions in developed countries was attributed to structural change (Sarkodie et al) [49]"; and "emissions reduction was the result of economic structural change (De Bruyn et al) [62]". Similar to industrial structure, energy utilization efficiency is also a restraining effect, which indicates that improving energy efficiency, that is, reducing energy intensity, helps to hinder the increase in carbon emissions.…”

“…A few scholars used the OECD decoupling index model. For example, Mulder et al investigated the decoupling of energy consumption and economic growth in 10 manufacturing sectors in 14 OECD countries [ 16 ]. De Freitas et al examined the decoupling of Brazil’s economic activity, carbon dioxide emissions and energy consumption [ 17 ]; Roinioti et al explored the decoupling status of Greece’s carbon dioxide emissions and economic growth [ 18 ].…”

“…Meanwhile, previous studies have shown that in addition to economic activity, industrial structure [ 3 , 16 , 17 , 49 , 62 , 77 , 78 , 79 ], level of opening-up [ 44 , 45 , 47 , 53 , 73 , 77 ] and energy utilization efficiency (energy intensity) [ 3 , 18 , 20 , 22 , 23 , 26 , 27 , 29 , 33 , 35 , 36 , 47 , 77 , 78 , 79 ] are also important factors affecting carbon dioxide emissions or their decoupling status from economy growth. In addition, environmental regulation is also an important variable affecting pollutant emission [ 80 , 81 , 82 , 83 ].…”

Sustainability Assessment Based on Integrating EKC with Decoupling: Empirical Evidence from China

“…Vehmas et al divided the decoupling index into decoupling and coupling, then further subdivided it into six logical possibilities, namely weak decoupling, strong decoupling, recessive decoupling, weak coupling, strong coupling, and expansionary coupling [11]. The above three decoupling index types are mainstream tools to empirically analyze the decoupling effect of carbon emissions [42][43][44][45]. However, some scholars have proposed that there would also be differences in the level of economic development or pollution emissions in the same decoupling status.…”

Natural resources in the production process

“…As one of the most widely cited macroeconomic indicators for measuring sustainability through estimates of decoupling effect, the Energy/GDP ratio has been the focus of a significant number of published studies. The majority of these studies examine the decoupling effect at the level of a single country (Ostblom, 1982;Bossanyi, 1979;Garbaccio and Jorgenson, 1999); and of a group of countries (Reister, 1987;Howarth et al, 1993;Mulder and de Groot, 2004;, while a few have recently attempted a global decoupling estimate UNEP, 2011). Concerning studies which estimate decoupling for a single country, there are several among them which empirically support that energy consumption grew at a much slower pace despite the significant increase in GDP (Ostblom 1982;Garbaccio and Jorgenson, 1999;.…”