South-South Ideas: Reducing Carbon Emissions for the Economic Development of the Global South

March 29, 2023

This paper explores the theme “Reducing Carbon Emissions for the Economic Development of the Global South.” To do this, we start by describing the characteristic facts of total carbon dioxide emissions, carbon dioxide emissions intensity and per capita carbon dioxide emissions in the world, Organization for Economic Co-operation and Development (OECD) countries, non-OECD countries and the BRICS (Brazil, Russia, India, China and South Africa) countries. From there, we see that the current non-OECD countries, including the vast majority of southern countries, have become the main global carbon dioxide emitters, especially the BRICS countries, whose carbon dioxide emissions account for more than 40 per cent of the world’s carbon dioxide emissions. Therefore, we find it essential to study the carbon dioxide emission reduction issues of southern countries in the process of economic development. Second, based on the Environmental Kuznets Curve (EKC) hypothesis and “decoupling” theory, we use the data of 111 economies from 1980 to 2018 to employ regression models to test the EKC hypothesis.

The empirical results recover a global EKC and show that when the per capita gross domestic product (GDP) of an economy exceeds US$30,619.735 the double dividend effect of economic growth and carbon dioxide emission reduction can be realized. Then, we select some representative countries based on the principles of population, GDP and per capita GDP to analyze the dynamics of the decoupling elastic coefficients of these representative countries to describe the trajectory of each country’s economic development and carbon dioxide emissions. Finally, we develop a macroeconomic model with micro-foundation and emission decisions, calibrate the parameters in the model and apply the model to simulated projection for all representative countries, by which the moment of the EKC turning (inflection) point in southern countries is shown.