CO₂ intensity and GDP per capita

Abstract

Purpose

To investigate whether CO₂ intensity falls at a diminishing rate as countries grow richer.

Design/methodology/approach

Regression of CO₂ intensity on the gross domestic product (GDP) per capita, including squared and cubic terms, for a panel of countries and individual countries.

Findings

CO₂ intensity falls at a diminishing rate as countries grow richer.

Originality/value

Many studies have found that CO₂ intensity falls with GDP per capita, but whether it does so at a diminishing rate has not been investigated. This result suggests that structural changes in GDP (more services) as countries get richer will provide little or no help toward decarbonization. It is shown that the extraction of minerals critical for industrial production has increased on par with real GDP. This could explain why CO₂ emissions fall at a diminishing rate.

Citation

Hannesson, R. (2020), "CO₂ intensity and GDP per capita", International Journal of Energy Sector Management, Vol. 14 No. 2, pp. 372-388. https://doi.org/10.1108/IJESM-02-2019-0011