Climate Change: It’s the Economy, Stupid

The political debate on climate change has hardly reached consensus on the science of human-induced carbon (CO2) emissions. But as the debate continues, countries with large populations such as China and India continue their trend of rapid economic expansion. According to a new study from the University of Michigan and the University of Valladolid, this economic growth could have a much larger impact on climate change than the impact of population growth alone.

The study “Climate change and the world economy: short-run determinants of atmospheric CO2” finds that increases in GDP have been historically correlated with increases in C02 concentrations in the atmosphere. While this may not sound like news, the study also found that there has been no significant relationship between short-term world population growth and C02 concentrations over the same period. The work provides new insight into the mechanisms through which human activity affects CO2 concentrations and ultimately climate change.

Authors José A. Tapia Granados, Edward L. Ionides, and Óscar Carpintero argue that as GDP increases, so too could the impact of human activity on CO2 concentrations in the atmosphere. The study analyzed historical data of the four most commonly discussed variables that influence CO2 atmospheric levels in the short-run: volcanic eruptions, the El Nino Southern Oscillation (ENSO), world population, and the world economy. The study was the first to use measures of atmospheric concentrations of CO2 instead of estimations of CO2 emissions in the analysis. The authors believe this is an important methodological decision because emissions estimations only measure what is put into the atmosphere, not what is actually in the atmosphere.

Of the four variables examined, the world economy proved to be the most highly correlated with C02 concentrations.

World Bank data suggests that world GDP (WGDP) has increased from 7.2 trillion to 41.3 trillion 2000 US dollars between 1960 and 2010. Over the same period, the world population has gone from about 3 billion to over 7 billion. Studying data from 1960 to 2010, the authors found that the volatile ebb and flow of WGDP growth coincided closely with peaks and troughs in the growth of global CO2 concentrations (see figure).

The analysis suggests that “for each trillion that WGDP deviates from the trend, the atmospheric CO2 concentration has deviated from trend, in the same direction, about half a part per million.” In other words, dips on the graph, such as during the early 1990s, show a slowdown in the annual increase of CO2 concentrations during the early 1990s, which correlated with the global downturn of world economic activity during those years.

The analysis also considered two others variables, El Nino Southern Oscillation (ENSO) and volcanic eruptions, both natural phenomena. Examining ENSO, the authors found both high sequestration as well as a growth in concentration levels of CO2 depending on the year.  In other words, ENSO is an important variable that must be accounted for when attempting to decipher how much changes in CO2 concentrations can be attributed to economic activity alone. After analyzing the data from volcanic activity the authors conclude that there was no strong evidence to assume that volcanic activity is a short-term determinant of atmospheric CO2 levels.

Fascinatingly, the study also found no relation between increases in population growth, unaccompanied by GDP growth, and CO2 concentrations. A regression analysis showed there was no statistically significant evidence to support the argument that population growth coincides with short-term CO2 atmospheric concentrations.

Although the analysis makes no predictions about the future, the study’s quantitative estimates and contributions have helped shed light on the potential causes of climate change, and more importantly, suggested that eventually a solution on a global scale may be necessary as WGDP continues its upward trend of growth.

The author’s findings that CO2 levels more closely correlate with economic growth than short-term population growth puts to rest the argument that population increases may influence climate change. Instead the debate now turns to how to deal with CO2 caps that hinder development, despite unrestrained population growth. This debate echoes the arguments of some climate policy critics: that CO2 caps hinder the development of emerging economies in spite of an underlying growth in the population. This uncomfortable truth highlights another reason that climate change is one of the most complicated problems of our day. Regardless, society has to determine whether discourse on the topic is still enough. Scientists have sounded the alarm and heralded the warnings, and the political battles continue to rage.

Feature photo: cc/NASA Goddard Photo and Video