The odd couple: The relationship between state economic performance and carbon emissions economic intensity

B. Davidsdottir*, Michael Fisher

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

19 Citations (Scopus)

Abstract

Historical time trends indicate that both carbon and energy intensity have declined in the United States over the last several decades, while economic performance, as measured by per capita GSP, has improved. This observation indicates that it may be possible to reduce carbon intensity without a reduction in economic performance. This paper assesses using panel analysis, the empirical relationship between carbon emissions intensity and economic performance, and examines the direction of causality between the two variables. Data for the analysis covered 48 states, excluding Hawaii, Alaska, and Washington DC, from 1980 to 2000. The results indicate significant bi-directional relationship between carbon emissions intensity and state economic performance, both using an aggregate indicator for carbon emissions intensity, decomposed using Laspeyres indexes and disaggregated by sector. This implies that it should be possible to implement statewide and sector-specific policies to reduce energy and carbon intensity and at the same time improve economic performance.

Original languageEnglish
Pages (from-to)4551-4562
Number of pages12
JournalEnergy Policy
Volume39
Issue number8
DOIs
Publication statusPublished - Aug 2011

Bibliographical note

Funding Information:
The authors wish to thank Skip Laitner at ACEEE and two anonymous reviewers for their helpful comments on this research. This research was partially conducted under contract EPA 68-W-99-042 to Abt Associates. Although the research described in this article has been funded in part by the United States Environmental Protection Agency contract (EPA 68-W-99-042) to (Abt Associates), it has not been subject to the Agency's review and therefore does not necessarily reflect the view of the Agency, and no official endorsement should be inferred.

Other keywords

  • Carbon intensity
  • Economic performance
  • Energy policy

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