Elsevier

Journal of Cleaner Production

Volume 167, 20 November 2017, Pages 120-132
Journal of Cleaner Production

The high ‘price’ of dematerialization: A dynamic panel data analysis of material use and economic recession

https://doi.org/10.1016/j.jclepro.2017.08.158Get rights and content

Highlights

  • Material use tends to decrease significantly during periods of recession.

  • Low economic growth (below 2%) may also be associated with dematerialization.

  • Reductions in material use are not likely if GDP growth exceeds 2%.

  • Minerals & ores are more sensitive to economic change than biomass & fossil fuels.

  • Population and wealth are important variables in explaining material use.

Abstract

Dematerialization at the national level occurs almost exclusively during periods of economic recession or low growth. While recession is not a sustainable strategy to curb environmental impact, such periods may offer important insights on the possibilities of reducing material use. Economic recession research has focused on the interactions between macroeconomic and financial variables with little systematic research dedicated to uncovering how resource use develops during periods of recession. Using a dynamic panel model, we investigate whether and to what extent material use in a sample of 150 economies between 1970 and 2010 was affected by recession and low growth. Recession occurred most frequently and in more than two thirds of all countries during the 1980s and the 1990s. In the 2000s, more than half of the recessions occurred during the financial crisis of 2008. Periods of recession were significantly and negatively correlated with material use - they tended to coincide with dematerialization. Material use decreased in recession years, but the significant correlations with growth in material use became weaker as growth rates increased. Construction minerals and metals, used to build stocks of manufactured capital, reacted more strongly to economic fluctuations than the throughput-dominated flows of biomass and fossil fuels. We conclude that the systematic link between recession and dematerialization can become policy-relevant if the mechanisms causing reductions in material use during these periods are identified.

Graphical abstract

Gross domestic product (GDP) and domestic material consumption (DMC = domestic extraction plus imports minus exports) growth rates in the United States of America (U.S.), Germany, Japan, and Brazil during 1970–2010. Please note the differences in scaling of the y-axis. Data sources: UNEP (2016a), World Bank (2016).

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Section snippets

Introduction: economic development and material flows

Global material use has increased from approximately 7 billion tons (Gigatons Gt) in the year 1900 (Krausmann et al., 2009) to approximately 70 Gt in 2010 (Schaffartzik et al., 2014). The extraction and use of these large and growing quantities of resources are related to a broad range of sustainability problems and a decoupling of material use and economic development is considered imperative for sustainable development (UNEP, 2011). It has been shown that, however, significant improvements in

Methods and data

In assessing the role which economic recession plays for material use levels, we require an analytic approach which allows us to study the relationship between these two (and other background) variables. We must assume that the material use levels are prone to feedback over time. This requires a dynamic model that can capture time lags in the material variable, such as, allowing past material use levels to influence current material use levels. “Static” panel techniques, as regularly used for

Results and discussion

Between 1970 and 2010, global material use,3 measured here as DMC, increased by a factor of 2.9, from 23.2 Gigatons (Gt) in 1970 to 68.1 Gt in 2010. The strongest growth during this period occurred in the use of non-metallic minerals for

Conclusions and outlook

Dematerialization, the reduction of absolute levels of material resource consumption, is a prerequisite to tackling some of the most pressing environmental issues of our time and to achieving a sustainability transformation. Using a dynamic panel data model to analyze the relationships between material flow and socio-economic indicators for 150 economies from 1970 to 2010, we found that globally, dematerialization coincided with periods of economic recession or very low growth which occurred

Acknowledgements

This work was supported by the State Scholarship Fund from China Scholarship Council (Grant No. 201306240017), the Austrian Science Fund FWF (Project MISO P27590), and the European Union (FP7-Science in Society-2010-1 Project Environmental Justice Organizations, Liabilities and Trade - EJOLT). The authors wish to thank ICREA Professor Giorgos Kallis and Dr. Beatriz Rodríguez-Labajos at ICTA-UAB as well as Nesen Ertugrul, Gerda Gieselmann-Hoschek, and Bernhard Hammer at Alpen-Adria University.

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