Decoupling of Economic Growth and Environmental Pressure in China

Start Date: 
Apr 1, 2014
End Date: 
Mar 31, 2015

By modeling materialization trends for China’s production structure against the consumer demand structure, the relationship between economic growth and environmental pressure can be measured.

Project Goal:
The goal of this project is to understand the environmental impact of China’s economic growth and evaluate the potential of decoupling its economic growth from increasing environmental pressure.

The question of whether environmental pressure can be reduced simultaneously along with economic growth has been intensively discussed (e.g., Arrow et al., 1995; Holdren, 2008). As the largest emerging economy, China has achieved spectacular economic growth but also experienced serious environmental degradation in the past two decades. Currently the second largest economy in the world, China also leads the world in resource consumption and waste emissions. For example, China is the world’s top consumer of primary energy and minerals, top producer of greenhouse gases (GHGs) and atmospheric mercury, major producer of carbonaceous aerosols, and the largest virtual water importer.

The unprecedented change in China offers a unique opportunity to uncover the relationship between economic growth and environmental pressure, which is important for achieving environmental sustainability in both China and the world. However, this effort in the literature has been limited mainly to specific environmental pressures/impacts, such as energy usage, aggregated resource productivity, CO2 emissions, and atmospheric pollutant emissions. Particular policies targeting at mitigating specific environmental impacts may lead to the increase of other environmental impacts, which is known as unintended consequences. There still remains a great need and major challenge in understanding the relationship between China’s economic growth and a comprehensive set of environmental impacts.

In this project we will explore the environmental impact of China’s economic growth in the past 20 years through three tasks: (1) compiling inventories for 31 types of resource and emission flows in China during 1992-2010; (2) examining the relationship between economic growth and environmental pressure during this period using a decoupling elasticity index; and (3) analyzing relative contributions of six socioeconomic drivers—material intensity, production structure, final demand structure, GDP composition, per capita GDP, and population—to China’s environmental pressure.

University of Michigan - Center for Chinese Studies (CCS)