Thursday, February 10, 2011

Energy and Wealth Aren't *That* Proportional

Roger Pielke takes Energy Secretary Chu to task for supposedly having said "it’s a myth that the wealth of a country is proportional to its energy use." As evidence of the high degree of proportionately, Pielke presents the above Gapminder graph, showing the total GDP of a country (y-axis, measured at purchasing power parity) highly correlated with the total energy use (x-axis).

However, Pielke has used a couple of not altogether legitimate graphing tricks to overstate his point.  Firstly, by using total GDP and total energy use, he spreads the points out further along the line, since very big countries will obviously, other things being equal, use much more energy and create much more GDP than very small countries.  But when we say that a country has "wealth", we don't usually mean that it's big, we mean instead that the inhabitants are well off on average.  So, sticking with Gapminder, if we switch to per-capita variables (GDP/capita on the y-axis, and CO emissions per person on the x-axis, since Gapminder won't do energy/capita) we get this:

Well, there certainly is a relationship still between wealth and fossil fuel usage.  However, note that this is a log-log graph.  If you look at the spread of the data in the x direction, you'll see that at any given wealth level, the lowest emitting countries are an order of magnitude better than the highest emitting countries.

So there clearly is enormous room for improvement in many high emitting countries, without becoming poor.


rks said...

Hmm, need to include the embodied energy in imported items. I know that's impossible, but it is wrong to saddle the Chinese with the energy (and carbon emissions) of goods that are assembled in China from imported stuff, then exported.

Gary said...

I'd go further to note that over the last thirty years in the U.S. where energy use is king, per capita energy use has remained almost constant while GDP has doubled.
Here is the graph.

Alexander Ac said...

Hi Gary,

interesting and very useful graph, but you might also like to know that US GDP growth is quite a fictional "debt and bubble fueled growth", maybe check this Dave Cohen graph (whole article here ) or any other graph on debt development,


yvesT said...

But maybe climate and resilience aspects should be added regarding energy use, by that typically I mean that KSA use fuel to generate 70% of its tap water, an energy need that obviously doesn't exist in many other countries.
Otherwise for sure there is some leeway, especially in the US.
Solution : fossile fuel taxes of course, but serious discussion on this would require the political life not to be completely dead, or focused on completely mundane aspects.

Stuart Staniford said...

Alex - while it's quite true that US private debt became too high in the bubble, and US federal debt is headed in an uncomfortable direction, that doesn't make the GDP inaccurate - we did create those goods and services.

Gary said...

Alex and Stuart, I was trying to consider how much of GDP growth came and the expense of "selling the furniture" abroad, or decreases in the savings rate here. And, indeed I argue that without those temporary boosts to consumption there might have been less GDP growth. See the "corrected GDP" line on the graph, and the entire blog post.

Alexander Ac said...


nice article, thanks.