Working paper

Can climate change be tackled without ditching economic growth?

The notion of degrowth to reduce greenhouse gas emissions appears unrealistic; decoupling of emissions from growth is in principle possible but requir

Publishing date
16 September 2021
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Higher levels of economic activity tend to go hand-in-hand with additional energy use and consumption of natural resources. As fossil fuels still account for 80 percent of the global energy mix, energy consumption remains closely related to greenhouse gas emissions and hence to climate forcing. This paper explores whether decarbonisation and economic growth are compatible or whether the world economy needs to grow less to be able to reduce greenhouse gas emissions fast enough to reach net zero in 2050. The literature provides profoundly different answers to this question, with scholars positioning along a spectrum that extends from the most optimist version of ‘green growth’ theories to sceptical ‘degrowth’ theories.

While globally, CO2 emissions per unit of GDP are declining, the decoupling rate from 1995 to 2018 was only -1.8 percent annually. To achieve net zero by 2050, the rate would have to accelerate to -8.7 percent, assuming population and GDP growth projections as given, or by a factor of almost five. To keep GDP growth and population at their projections and thus reject the proposition of de-growth, decoupling would have to accelerate massively. Two avenues are crucial: reducing the energy intensity of production and/or the emissions intensity of energy. The huge fall in the price of renewable energy provides hope that decoupling can accelerate. Decoupling rates have accelerated in the last decade and decoupling is substantially faster in the European Union. In the EU, we estimate that decoupling only has to accelerate by a factor of 2.5.

We do not think degrowth propositions advanced in the literature will be pursued and therefore focus on the main challenges that must be tackled to achieve decoupling. Unprecedented efforts are required to achieve green growth. But hoping for humanity to sacrifice growth appears unrealistic.

Recommended citation:

Lenaerts, K., S. Tagliapietra and G.B. Wolff (2021) ‘Can climate change be tackled without ditching economic growth?’, Working Paper 10/2021, Bruegel

About the authors

  • Guntram B. Wolff

    Guntram Wolff is a Senior fellow at Bruegel. He is also a Professor of Public Policy and Economics at the Willy Brandt School of Public Policy. From 2022-2024, he was the Director and CEO of the German Council on Foreign Relations (DGAP) and from 2013-22 the director of Bruegel. Over his career, he has contributed to research on European political economy, climate policy, geoeconomics, macroeconomics and foreign affairs. His work was published in academic journals such as Nature, Science, Research Policy, Energy Policy, Climate Policy, Journal of European Public Policy, Journal of Banking and Finance. His co-authored book “The macroeconomics of decarbonization” is published in Cambridge University Press.

    An experienced public adviser, he has been testifying twice a year since 2013 to the informal European finance ministers’ and central bank governors’ ECOFIN Council meeting on a large variety of topics. He also regularly testifies to the European Parliament, the Bundestag and speaks to corporate boards. In 2020, Business Insider ranked him one of the 28 most influential “power players” in Europe. From 2012-16, he was a member of the French prime minister’s Conseil d’Analyse Economique. In 2018, then IMF managing director Christine Lagarde appointed him to the external advisory group on surveillance to review the Fund’s priorities. In 2021, he was appointed member and co-director to the G20 High level independent panel on pandemic prevention, preparedness and response under the co-chairs Tharman Shanmugaratnam, Lawrence H. Summers and Ngozi Okonjo-Iweala. From 2013-22, he was an advisor to the Mastercard Centre for Inclusive Growth. He is a member of the Bulgarian Council of Economic Analysis, the European Council on Foreign Affairs and  advisory board of Elcano.

    Guntram joined Bruegel from the European Commission, where he worked on the macroeconomics of the euro area and the reform of euro area governance. Prior to joining the Commission, he worked in the research department at the Bundesbank, which he joined after completing his PhD in economics at the University of Bonn. He also worked as an external adviser to the International Monetary Fund. He is fluent in German, English, and French. His work is regularly published and cited in leading media. 

  • Simone Tagliapietra

    Simone Tagliapietra is a Senior fellow at Bruegel. He is also a Professor of Energy, Climate and Environmental Policy at the Catholic University of Milan and at The Johns Hopkins University - School of Advanced International Studies (SAIS) Europe.

    His research focuses on the European Union climate and energy policy and on the political economy of global decarbonisation. With a record of numerous policy and scientific publications, also in leading journals such as Nature and Science, he is the author of Global Energy Fundamentals (Cambridge University Press, 2020).

    His columns and policy work are published and cited in leading international media such as the BBC, CNN, Financial Times, The New York Times, The Economist, The Guardian, The Wall Street Journal, Le Monde, Die Zeit, Corriere della Sera, and others.

    Simone also is a Member of the Board of Directors of the Clean Air Task Force (CATF). He holds a PhD in Institutions and Policies from Università Cattolica del Sacro Cuore. Born in the Dolomites in 1988, he speaks Italian, English and French.

  • Klaas Lenaerts

    Klaas worked at Bruegel as a Research Analyst until August 2022. He holds a Master in Economics from the KU Leuven and in European Economic Studies from the College of Europe. Additionally, he spent one semester at Uppsala University.

    Klaas has a broad background in economics and European affairs. Before joining Bruegel he did a traineeship at the Permanent Representation of Belgium to the EU, where he worked on enlargement discussions, and at the European Securities and Markets Authority in Paris, where he contributed mainly to the work of the Risk Analysis and Economics department on such topics as crypto regulation and sustainable finance.

    His fields of interest include European climate policy and Eurozone governance, as well as external relations and trade. He is fluent in Dutch and English and advanced in French and German.

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