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Rethinking Economic Growth Theory From a Biophysical Perspective pp 17–43Cite as

Decoupling

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Part of the book series: SpringerBriefs in Energy ((ENERGYANALYS))

Abstract

This chapter investigates the implicit neoclassical assumption that the quantity of economic output can become decoupled from energy inputs. While trends in the energy intensity of US real GDP seem to give evidence for decoupling, this chapter investigates the possibility that such evidence is a methodological artifact that results from the use of monetary value to measure output. The following hypothesis is proposed: rather than measure output, monetary value functions as a feedback mechanism for controlling biophysical throughput. This hypothesis is tested using a metric called “energy-specific purchasing power”. Historical evidence supports the conclusion that monetary value does function as a feedback mechanism and that evidence for decoupling is a methodological artifact. The implications for a biophysical growth theory are discussed.

If it is very easy to substitute other factors for natural resources, then there is in principle no “problem”. The world can, in effect, get along without natural resources.

– Robert Solow (1974, p. 11)

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Notes

  1. 1.

    Value of fossil fuel production from Enersy Information Administratio (EIA), Annual Energy Review, Table 3.2. Value of fossil fuel imports from ibid, Table 3.7. Nominal GDP from BEA Table 1.1.5.

  2. 2.

    Relative standard deviation is defined as the standard deviation divided by the data mean and multiplied by 100 %.

  3. 3.

    I use the word specific to disambiguate from the more common notion of purchasing power, which typically refers to the ability to consume a basket of goods or services, rather than a single good.

  4. 4.

    While an individual could conceivably spend his entire income on a single commodity, it is impossible (and absurd) for a nation to do so. For instance, if the USA spent its entire nominal GDP on fossil fuel energy, its energy consumption would be greater than that for the entire world, and no other goods or services would be generated.

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Authors and Affiliations

  1. Faculty of Environmental Studies, York University, Toronto, Ontario, Canada

    Blair Fix

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  1. Blair Fix
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Correspondence to Blair Fix .

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Fix, B. (2015). Decoupling. In: Rethinking Economic Growth Theory From a Biophysical Perspective. SpringerBriefs in Energy(). Springer, Cham. https://doi.org/10.1007/978-3-319-12826-9_2

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  • DOI: https://doi.org/10.1007/978-3-319-12826-9_2

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  • Print ISBN: 978-3-319-12825-2

  • Online ISBN: 978-3-319-12826-9

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