The Long-Run Decoupling of Emissions and Output: Evidence from the Largest Emitters

Gail Cohen, Joao Jalles, Prakash Loungani and Ricardo Marto

No 2018/056, IMF Working Papers from International Monetary Fund

Abstract: For the world's 20 largest emitters, we use a simple trend/cycle decomposition to provide evidence of decoupling between greenhouse gas emissions and output in richer nations, particularly in European countries, but not yet in emerging markets. If consumption-based emissions—measures that account for countries' net emissions embodied in cross-border trade—are used, the evidence for decoupling in the richer economies gets weaker. Countries with underlying policy frameworks more supportive of renewable energy and climate change mitigation efforts tend to show greater decoupling between trend emissions and trend GDP, and for both production- and consumption-based emissions. The relationship between trend emissions and trend GDP has also become much weaker in the last two decades than in preceding decades.

Keywords: WP; trend elasticity; Emissions; Environmental Okun’s Law; Environmental Kuznets Curve; coefficient estimate; GHG emitter; elasticity estimate; consumption pattern; Greenhouse gas emissions; Emerging and frontier financial markets; Climate change; Environmental policy; Climate policy; Global (search for similar items in EconPapers)
Pages: 29
Date: 2018-03-13
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Citations: View citations in EconPapers (41)

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Journal Article: The long-run decoupling of emissions and output: Evidence from the largest emitters (2018)
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