CO2 emissions and economic activity: Short- and long-run economic determinants of scale, energy intensity and carbon intensity
We analyze the short-term and the long-term determinants of energy intensity, carbon intensity and scale effects for eight developed economies and two emerging economies from 1973 to 2007. Our results show that there is a difference between the short-term and the long-term results and that climate policy are more likely to affect emission over the long-term than over the short-term. Climate policies should therefore be aimed at a time horizon of at least 8 years and year-on-year changes in emissions contains little information about the trend path of emissions. In the long-run capital accumulation is the main driver of emissions. Productivity growth reduces the energy intensity while the real oil price reduces both the energy intensity and the carbon intensity. The real oil price effect suggests that a global carbon tax is an important policy tool to reduce emissions, but our results also suggest that a carbon tax is likely to be insufficient decouple emission from economic growth. Such a decoupling is likely to require a structural transformation of the economy. The key policy challenge is thus to build new economic structures where investments in green technologies are more profitable.
If you experience problems downloading a file, check if you have the proper application to view it first. 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.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
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.:
- Gene M. Grossman & Alan B. Krueger, 1994.
"Economic Growth and the Environment,"
NBER Working Papers
4634, National Bureau of Economic Research, Inc.
- Charles Gore, 2010. "The global recession of 2009 in a long-term development perspective," Journal of International Development, John Wiley & Sons, Ltd., vol. 22(6), pages 714-738.
- Geels, Frank W. & Schot, Johan, 2007. "Typology of sociotechnical transition pathways," Research Policy, Elsevier, vol. 36(3), pages 399-417, April.
- Bekaert, Geert & Harvey, Campbell R. & Lundblad, Christian, 2011.
"Financial Openness and Productivity,"
Elsevier, vol. 39(1), pages 1-19, January.
- Weitzman, Martin L, 1974.
"Prices vs. Quantities,"
Review of Economic Studies,
Wiley Blackwell, vol. 41(4), pages 477-91, October.
- Bode, Sven, 2006. "Long-term greenhouse gas emission reductions--what's possible, what's necessary?," Energy Policy, Elsevier, vol. 34(9), pages 971-974, June.
- Ramsey James B. & Lampart Camille, 1998. "The Decomposition of Economic Relationships by Time Scale Using Wavelets: Expenditure and Income," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 3(1), pages 1-22, April.
- Tol, Richard S.J., 2007.
"Carbon dioxide emission scenarios for the USA,"
Elsevier, vol. 35(11), pages 5310-5326, November.
- Richard S.J. Tol, 2006. "Carbon Dioxide Emission Scenarios for the Usa," Working Papers 2006.117, Fondazione Eni Enrico Mattei.
- Richard S.J. Tol, 2006. "Carbon Dioxide Emission Scenarios For The Usa," Working Papers FNU-101, Research unit Sustainability and Global Change, Hamburg University, revised May 2006.
- David I. Stern & Frank Jotzo, 2009.
"How Ambitious are China and India's Emissions Intensity Targets?,"
Environmental Economics Research Hub Research Reports
1051, Environmental Economics Research Hub, Crawford School of Public Policy, The Australian National University.
- Stern, David I. & Jotzo, Frank, 2010. "How ambitious are China and India's emissions intensity targets?," Energy Policy, Elsevier, vol. 38(11), pages 6776-6783, November.
- Stern, David I. & Jotzo, Frank, 2010. "How Ambitious are China and India’s Emissions Intensity Targets?," Research Reports 94947, Australian National University, Environmental Economics Research Hub.
- Krugman, Paul R & Venables, Anthony J, 1995.
"Globalization and the Inequality of Nations,"
The Quarterly Journal of Economics,
MIT Press, vol. 110(4), pages 857-80, November.
- Krugman, Paul & Venables, Anthony J., 1995. "Globalization and the Inequality of Nations," Working Paper Series 430, Research Institute of Industrial Economics.
- Krugman, Paul & Venables, Anthony J, 1994. "Globalization and the Inequality of Nations," CEPR Discussion Papers 1015, C.E.P.R. Discussion Papers.
- Paul Krugman & Anthony J. Venables, 1995. "Globalization and the Inequality of Nations," NBER Working Papers 5098, National Bureau of Economic Research, Inc.
- Englund, P. & Persson, T. & Svensson, L.E.O., 1991.
"Swedish Business Cycles : 1861-1988,"
RCER Working Papers
275a, University of Rochester - Center for Economic Research (RCER).
- von Tunzelmann, Nick, 2003. "Historical coevolution of governance and technology in the industrial revolutions," Structural Change and Economic Dynamics, Elsevier, vol. 14(4), pages 365-384, December.
- Selden Thomas M. & Song Daqing, 1994. "Environmental Quality and Development: Is There a Kuznets Curve for Air Pollution Emissions?," Journal of Environmental Economics and Management, Elsevier, vol. 27(2), pages 147-162, September.
- He, Jie & Richard, Patrick, 2010.
"Environmental Kuznets curve for CO2 in Canada,"
Elsevier, vol. 69(5), pages 1083-1093, March.
- Chimeli, Ariaster B. & Braden, John B., 2009. "A capital scarcity theory of the environmental Kuznets curve," Environment and Development Economics, Cambridge University Press, vol. 14(05), pages 541-564, October.
- Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
- Guo, Jie & Zou, Le-Le & Wei, Yi-Ming, 2010. "Impact of inter-sectoral trade on national and global CO2 emissions: An empirical analysis of China and US," Energy Policy, Elsevier, vol. 38(3), pages 1389-1397, March.
- Marvin Goodfriend & Robert King, 1997.
"The New Neoclassical Synthesis and the Role of Monetary Policy,"
in: NBER Macroeconomics Annual 1997, Volume 12, pages 231-296
National Bureau of Economic Research, Inc.
- Marvin Goodfriend & Robert G. King, 1998. "The new neoclassical synthesis and the role of monetary policy," Working Paper 98-05, Federal Reserve Bank of Richmond.
- Gene M. Grossman & Alan B. Krueger, 1991.
"Environmental Impacts of a North American Free Trade Agreement,"
NBER Working Papers
3914, National Bureau of Economic Research, Inc.
- Grossman, Gene & Krueger, Alan B, 1992. "Environmental Impacts of a North American Free Trade Agreement," CEPR Discussion Papers 644, C.E.P.R. Discussion Papers.
- Grossman, G.M & Krueger, A.B., 1991. "Environmental Impacts of a North American Free Trade Agreement," Papers 158, Princeton, Woodrow Wilson School - Public and International Affairs.
- Lindmark, Magnus, 2004. "Patterns of historical CO2 intensity transitions among high and low-income countries," Explorations in Economic History, Elsevier, vol. 41(4), pages 426-447, October.
- Arellano, M, 1987. "Computing Robust Standard Errors for Within-Groups Estimators," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 49(4), pages 431-34, November.
- Cameron Hepburn, 2006. "Regulation by Prices, Quantities, or Both: A Review of Instrument Choice," Oxford Review of Economic Policy, Oxford University Press, vol. 22(2), pages 226-247, Summer.
- Andersson, Fredrik N. G., 2011. "Band Spectrum Regressions using Wavelet Analysis," Working Papers 2011:22, Lund University, Department of Economics.
- Hamilton, Clive & Turton, Hal, 2002. "Determinants of emissions growth in OECD countries," Energy Policy, Elsevier, vol. 30(1), pages 63-71, January.
- Kerstin, Enflo & Kander, Astrid & Schön, Lennart, 2008.
"Electrification and energy productivity,"
Papers in Innovation Studies
2008/16, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
- Steven Saeger, 1997. "Globalization and deindustrialization: Myth and reality in the OECD," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 133(4), pages 579-608, December.
- Zhang, F. Q. & Ang, B. W., 2001. "Methodological issues in cross-country/region decomposition of energy and environment indicators," Energy Economics, Elsevier, vol. 23(2), pages 179-190, March.
- Weber, Christopher L., 2009. "Measuring structural change and energy use: Decomposition of the US economy from 1997 to 2002," Energy Policy, Elsevier, vol. 37(4), pages 1561-1570, April.
- Wang, S.S. & Zhou, D.Q. & Zhou, P. & Wang, Q.W., 2011. "CO2 emissions, energy consumption and economic growth in China: A panel data analysis," Energy Policy, Elsevier, vol. 39(9), pages 4870-4875, September.
- Engle, Robert F, 1974.
"Band Spectrum Regression,"
International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 15(1), pages 1-11, February.
- Larson, Donald & Butzer, Rita & Mundlak, Yair & Crego, Al, . "Sectoral Investment and Capital," Instructional Stata datasets for econometrics sectinvcap, Boston College Department of Economics.
- Richard S.J. Tol & Stephen W. Pacala & Robert Socolow, 2006.
"Understanding Long-Term Energy Use and Carbon Dioxide Emissions in the Usa,"
2006.107, Fondazione Eni Enrico Mattei.
- Tol, Richard S.J. & Pacala, Stephen W. & Socolow, Robert H., 2009. "Understanding Long-Term Energy Use and Carbon Dioxide Emissions in the USA," Journal of Policy Modeling, Elsevier, vol. 31(3), pages 425-445, May.
- Richard S.J. Tol & Stephen W. Pacala & Robert H. Socolow, 2006. "Understanding Long-Term Energy Use And Carbon Dioxide Emissions In The Usa," Working Papers FNU-100, Research unit Sustainability and Global Change, Hamburg University, revised Mar 2006.
- Jean-Paul Rodrigue, 2006. "Transportation and the Geographical and Functional Integration of Global Production Networks," Growth and Change, Wiley Blackwell, vol. 37(4), pages 510-525.
- Sun, J. W., 1998. "Changes in energy consumption and energy intensity: A complete decomposition model," Energy Economics, Elsevier, vol. 20(1), pages 85-100, February.
- Narayan, Paresh Kumar & Smyth, Russell, 2008. "Energy consumption and real GDP in G7 countries: New evidence from panel cointegration with structural breaks," Energy Economics, Elsevier, vol. 30(5), pages 2331-2341, September.
- Dinda, Soumyananda, 2004. "Environmental Kuznets Curve Hypothesis: A Survey," Ecological Economics, Elsevier, vol. 49(4), pages 431-455, August.
- Ang, B.W. & Zhang, F.Q., 2000. "A survey of index decomposition analysis in energy and environmental studies," Energy, Elsevier, vol. 25(12), pages 1149-1176.
- Ayres, Robert U & Kneese, Allen V, 1969. "Production , Consumption, and Externalities," American Economic Review, American Economic Association, vol. 59(3), pages 282-97, June.
- Lise, Wietze, 2006. "Decomposition of CO2 emissions over 1980-2003 in Turkey," Energy Policy, Elsevier, vol. 34(14), pages 1841-1852, September.
- Honma, Satoshi & Hu, Jin-Li, 2009. "Total-factor energy productivity growth of regions in Japan," Energy Policy, Elsevier, vol. 37(10), pages 3941-3950, October.
- Cover, James P. & Pecorino, Paul, 2005. "The length of US business expansions: When did the break in the data occur?," Journal of Macroeconomics, Elsevier, vol. 27(3), pages 452-471, September.
- Jones, Donald W., 1991. "How urbanization affects energy-use in developing countries," Energy Policy, Elsevier, vol. 19(7), pages 621-630, September.
When requesting a correction, please mention this item's handle: RePEc:eee:enepol:v:61:y:2013:i:c:p:1285-1294. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.