Decoupling of Emissions and GDP: Evidence from Aggregate and Provincial Chinese Data

Gail Cohen, Joao Jalles, Prakash Loungani, Ricardo Marto and Gewei Wang

No 2018/085, IMF Working Papers from International Monetary Fund

Abstract: We provide a comprehensive analysis of the relationship between greenhouse gas (GHG) emissions and GDP in China using both aggregate and provincial data. The Kuznets elasticity is about 0.6 for China, higher than that in advanced countries but below that of major emerging markets. The elasticity is somewhat lower for consumption-based emissions than for production-based emissions, providing mild evidence consistent with the “pollution haven” hypothesis. The Kuznets elasticity is much lower for the last three decades than for the three previous decades, suggesting a longer-term trend toward decoupling as China has become richer. Further evidence of this comes from provincial data: richer provinces tend to have smaller Kuznets elasticities than poorer ones. In addition to the trend relationship, we find that the Environmental Okun's Law holds in China.

Keywords: WP; real GDP; Emissions; Environmental Okun’s Law; Kuznets Curve; China; Provinces; Kuznets elasticity; GHG emission; trend emission; emissions growth; emissions-output elasticity; Greenhouse gas emissions; Personal income; Business cycles; Non-renewable resources; Climate change; Global (search for similar items in EconPapers)
Pages: 26
Date: 2018-04-11
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Journal Article: Decoupling of emissions and GDP: Evidence from aggregate and provincial Chinese data (2019)
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