The challenge of reducing global carbon emissions by 50-85 per cent by the year 2050, which is suggested by the Intergovernmental Panel on Climate Change (2007a) as a target compatible with limiting the risk of a more-than-2ºC temperature increase, clearly conflicts with existing patterns of economic growth, which are heavily dependent on increased use of fossil fuel energy. While it is theoretically possible to conceive of economic growth being “delinked” from fossil fuel consumption, any such delinking would represent a drastic change from economic patterns of the last 150 years. Current macroeconomic theory is heavily oriented towards an assumption of continuous, exponential growth in GDP. The historical record shows GDP growth is strongly correlated with a parallel record of increasing fossil energy use and CO2 emissions. A path of reduced carbon emissions would require major modifications in economic growth patterns. Climate change is part of an inter-related group of environmental issues associated with growth limits. These include population growth, agricultural production, water supplies, and species loss. To achieve a low-carbon path requires population stabilization, limited consumption, and major investments in environmental protection and social priorities such as public health, nutrition, and education. Macroeconomic theory must be adapted to reflect these new realities. A reclassification of macroeconomic aggregates is proposed to distinguish between those categories of goods and services that can expand over time, and those that must be limited to reduce carbon emissions. This reformulation makes it clear that there are many possibilities for environmentally beneficial economic expansion. New forms of Keynesian policy oriented towards ecological sustainability, provision of basic social needs such as education and health care, and distributional equity can provide a basis for a rapid reduction in carbon emissions while promoting investment in human and natural capital.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Publisher Info
Paper provided by GDAE, Tufts University in its series GDAE Working Papers with number
08-02.
For technical questions regarding this item, or to correct its listing, contact: (Lauren Denizard).
Related research
Keywords:
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.: