Unravelling connections: energy, economic growth, and decoupling through a historical lens

Graham Palmer and Joshua Floyd

New Political Economy, 2025, vol. 30, issue 4, 508-525

Abstract: Decoupling pervades environmental policy, yet its extent remains a topic of debate. Decoupling suggests that economic growth can detach from resources, energy, and impacts through technology and efficiency. However, biophysical theory asserts that the primary driver of growth has been the expansion of energy supply. We contribute to the debate by highlighting a crucial yet often overlooked distinction between tangible and abstract phenomena. This distinction is important because, fundamentally, physical effects must have physical causes. A challenge lies in establishing a causal relationship between energy and economy given the intermediary role of money as a social technology. Both decoupling and biophysical frameworks grapple with this challenge, yet neither provides a definitive resolution. Biophysical theory emphasises physical processes but struggles to incorporate money into a causal schema, while decoupling prioritises monetary factors but fails to explain the critical role of energy and resources. To bridge this disparity, we present a causal model that clarifies the connection between money and the tangible economy. We trace the historical evolution of abstract value through the development of private property, coinage, and modern currency, illustrating how these constructs became intertwined with energy supply and storage. Through this exploration, we offer a novel perspective on decoupling.

Date: 2025
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DOI: 10.1080/13563467.2025.2453574

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