# Optimal environment-friendly economic restructuring: the United States–China cooperation case study

Article

First Online:

- 188 Downloads
- 1 Citations

## Abstract

This paper discusses a model for the restructuring of national economies for the purpose of achieving optimal growth under conditions of decreased energy consumption and greenhouse gas emissions. The discussion combines input–output and factorial-decomposition models, and applies projected gradient and factor analysis to find the optimal structural changes that serve all three goals. A comparative analysis of the economies of the United States and China, including opportunities for cooperative restructuring, serves as a case study.

## Keywords

Optimal economic growth Environmental protection Economic restructuring International cooperation## References

- Albert A (1972) Regression and Moore–Penrose pseudoinverse. Academic Press, New YorkGoogle Scholar
- Albiman M, Suleiman N, Baka H (2015) The relationship between energy consumption, CO
_{2}emissions and economic growth in Tanzania. Int J Energy Sect Manag 9(3):361–375CrossRefGoogle Scholar - Arazmuradov A (2016) Economic prospect on carbon emissions in Commonwealth of Independent States. Econ Change Restruct 49(4):395–427CrossRefGoogle Scholar
- Asif M, Sharma RB, Adow AHE (2015) An empirical investigation of the relationship between economic growth, urbanization, energy consumption, and CO
_{2}emission in GCC countries: a panel data analysis. Asian Soc Sci 11(21):270–284CrossRefGoogle Scholar - Ayres R, Kneese A (1969) Production, consumption and externalities. Am Econ Rev 59(3):282–297Google Scholar
- Bastola U, Sapkota P (2015) Relationships among energy consumption, pollution emission, and economic growth in Nepal. Energy 80:254–262CrossRefGoogle Scholar
- Bertsekas D (1976) On the Goldstein–Levitin–Polyak gradient projection method. IEEE Trans Autom Control 21(2):174–184CrossRefGoogle Scholar
- Brissimis S, Hondroyiannis G, Papazoglou C, Tsaveas N, Vasardani M (2012) Current account determinants and external sustainability in periods of structural change. Econ Change Restruct 45(2):71–95CrossRefGoogle Scholar
- Brizga J, Feng K, Hubacek K (2014) Drivers of greenhouse gas emissions in the Baltic States: a structural decomposition analysis. Ecol Econ 98:22–28CrossRefGoogle Scholar
- Brown M, Cohen M, Sweeney S (2009) Predicting national sustainability: the convergence of energetic, economic and environmental realities. Ecol Model 220:3424–3438CrossRefGoogle Scholar
- Bullard C, Penner P, Pilati D (1978) Energy analysis handbook. Resour Energy 1:267–313CrossRefGoogle Scholar
- Butnar I, Llop M (2011) Structural decomposition analysis and input-output subsystems: changes in CO
_{2}emissions of Spanish service sectors (2000–2005). Ecol Econ 70(11):2012–2019CrossRefGoogle Scholar - Calamai P, More J (1987) Projected gradient methods for linearly constrained problems. Math Program 39:93–116CrossRefGoogle Scholar
- Cellura M, Di Gangi A, Longo S, Orioli A (2013) An Italian input–output model for the assessment of energy and environmental benefits arising from retrofit actions of buildings. Energy Build 62:97–106CrossRefGoogle Scholar
- Chang C (2010) A multivariate causality test of carbon dioxide emissions, energy consumption and economic growth in China. Appl Energy 87:3533–3537CrossRefGoogle Scholar
- Chontanawat J, Hunt LC, Pierse R (2008) Does energy consumption cause economic growth?: evidence from a systematic study of over 100 countries. J Policy Model 30:209–220CrossRefGoogle Scholar
- Diewert W, Nakamura A (eds) (1993) Essays in index number theory. Elsevier Science Publishers, New YorkGoogle Scholar
- Divisia F (1925) L’indice Monetaire et la Theorie de la Monnaie. Revue d’Economic Politique 39(5):980–1020
**(In French)**Google Scholar - Duan H-B, Zhu L, Fan Y (2014) Optimal carbon taxes in carbon-constrained China: a logistic-induced energy economic hybrid model. Energy 69:345–356CrossRefGoogle Scholar
- Eckelman M, Ciacci L, Kavlak G, Nuss P, Reck B, Graedel T (2014) Life cycle carbon benefits of aerospace alloy recycling. J Clean Prod 80:38–45CrossRefGoogle Scholar
- Fan G, He L, Wei X, Han L (2013) China’s growth adjustment: moderation and structural changes. Econ Change Restruct 46(1):9–24CrossRefGoogle Scholar
- Fan J, Wang Q, Sun W (2015) The failure of China’s energy development strategy 2050 and its impact on carbon emissions. Renew Sustain Energy Rev 49(4351):1160–1170CrossRefGoogle Scholar
- Flaschel P (1982) Input–output technology assumptions and the energy requirements of commodities. Resour Energy 4:359–389CrossRefGoogle Scholar
- Ghosh A (1964) Experiments with input–output models. Cambridge University Press, CambridgeGoogle Scholar
- Gokhberg L, Roud V (2016) Structural changes in the national innovation system: longitudinal study of innovation modes in the Russian industry. Econ Change Restruct 49(2–3):269–288CrossRefGoogle Scholar
- Goldstein A (1964) Convex programming in Hilbert space. Bull Am Math Soc 70:709–710CrossRefGoogle Scholar
- Gossling S, Scott D, Hall CM (2015) Inter-market variability in CO
_{2}emission-intensities in tourism: implications for destination marketing and carbon management. Tour Manag 46:203–212CrossRefGoogle Scholar - Grana Drummond L, Iusem A (2004) A projected gradient method for vector optimization problems. Comput Optim Appl 28:5–29CrossRefGoogle Scholar
- Griffin J (1976) Energy input–output modeling. Electric power research institute, Palo AltoGoogle Scholar
- Guan D, Hubacek K, Weber C, Peters G, Reiner D (2008) The drivers of Chinese CO
_{2}emissions from 1980 to 2030. Glob Environ Change 18:626–634CrossRefGoogle Scholar - Hanak D, Anthony E, Manovic V (2015) A review of developments in pilot-plant testing and modelling of calcium looping process for CO
_{2}capture from power generation systems. Energy Environ Sci 8(8):2199–2249CrossRefGoogle Scholar - Haseeb M, Azam M (2015) Energy consumption, economic growth and CO
_{2}emission nexus in Pakistan. Asian J Appl Sci 8(1):27–36CrossRefGoogle Scholar - Hu H, Zhang X, Lin L (2014) The interactions between China’s economic growth, energy production and consumption and the related air emissions during 2000–2011. Ecol Ind 46:38–51CrossRefGoogle Scholar
- IEA (2014) World Energy Outlook 2014. International Energy Agency. Available at http://www.worldenergyoutlook.org/publications/weo-2014/
- IPCC (2014) Summary for policymakers. In: Edenhofer O, Pichs-Madruga R, Sokona Y, Farahani E, Kadner S, Seyboth K, Adler A, Baum I, Brunner S, Eickemeier P, Kriemann B, Savolainen J, Schlomer S, von Stechow C, Zwickel T, Minx JC (eds) Climate change 2014: mitigation of climate change. Contribution of working group III to the fifth assessment report of the intergovernmental panel on climate change. Cambridge University Press, CambridgeGoogle Scholar
- Isa Z, Al Sayed A, Kun S (2015) Detect the relationship among energy consumption, economic growth and greenhouse gases by panel data approach. Appl Math Sci 9(53–56):2645–2656Google Scholar
- Jammazi R, Aloui C (2015) On the interplay between energy consumption, economic growth and CO
_{2}emission nexus in the GCC countries: a comparative analysis through wavelet approaches. Renew Sustain Energy Rev 51(4676):1737–1751CrossRefGoogle Scholar - Jebli MB, Youssef SB (2015) Output, renewable and non-renewable energy consumption and international trade: evidence from a panel of 69 countries. Renew Energy 83:799–808CrossRefGoogle Scholar
- Joo Y-J, Kim CS, Yoo S-H (2015) Energy consumption, CO
_{2}emission, and economic growth: evidence from Chile. Int J Green Energy 12(5):543–550CrossRefGoogle Scholar - Kaplan W (1993) Advanced calculus, 4th edn. Addison-Wesley, New YorkGoogle Scholar
- Kasman A, Duman Y (2015) CO
_{2}emissions, economic growth, energy consumption, trade and urbanization in new EU member and candidate countries: a panel data analysis. Econ Model 44:97–103CrossRefGoogle Scholar - Kaya Y (1990) Impact of carbon dioxide emission control on GNP growth: interpretation of proposed scenarios. Paper presented to the IPCC Energy and Industry Subgroup, Response Strategies Working Group, Paris, mimeoGoogle Scholar
- Kumar R, Stauvermann P, Patel A (2015) Nexus between electricity consumption and economic growth: a study of Gibraltar. Econ Change Restruct 48(2):119–135CrossRefGoogle Scholar
- Laspeyres E (1871) Die Berechnung einer mittleren Waarenpreissteigerung. Jahrbücher für Nationalökonomie und Statistik 16:296–315
**(In German)**CrossRefGoogle Scholar - Leontief W (1941) The structure of the American economy, 1919–1939: an empirical application of equilibrium analysis. Harvard University Press, CambridgeGoogle Scholar
- Leontief W (1986) Input–output economics, 2nd edn. Oxford University Press, New YorkGoogle Scholar
- Levitin E, Polyak B (1966) Constrained minimization methods. USSR Comput Math Math Phys 6:1–50CrossRefGoogle Scholar
- Lin B, Liu X (2012) Dilemma between economic development and energy, conservation: energy rebound effect in China. Energy 45:867–873CrossRefGoogle Scholar
- Lin B, Liu H (2015) CO
_{2}emissions of China’s commercial and residential buildings: evidence and reduction policy. Build Environ 92:418–431CrossRefGoogle Scholar - Liu Y, Zhou Y, Wu W (2015) Assessing the impact of population, income and technology on energy consumption and industrial pollutant emissions in China. Appl Energy 155:904–917CrossRefGoogle Scholar
- Long X, Naminse EY, Du J, Zhuang J (2015) Nonrenewable energy, renewable energy, carbon dioxide emissions and economic growth in China from 1952 to 2012. Renew Sustain Energy Rev 52:680–688CrossRefGoogle Scholar
- Lozano S, Gutierez E (2008) Non-parametric frontier approach to modelling the relationships among population, GDP, energy consumption and CO
_{2}emissions. Ecol Econ 66:687–699CrossRefGoogle Scholar - Madsen H, Sogaard E, Muff J (2015) Reduction in energy consumption of electrochemical pesticide degradation through combination with membrane filtration. Chem Eng J 276:358–364CrossRefGoogle Scholar
- Maital S, Vaninsky A (1999) Data envelopment analysis with a single DMU: a graphic projected-gradient approach. Eur J Oper Res 115(3):518–528CrossRefGoogle Scholar
- Maital S, Vaninsky A (2000) Productivity paradoxes and their resolution. J Prod Anal 14(3):191–207CrossRefGoogle Scholar
- Mallol-Poyato R, Salcedo-Sanz S, Jimenez-Fernandez S, Diaz-Villar P (2015) Optimal discharge scheduling of energy storage systems in MicroGrids based on hyper-heuristics. Renew Energy 83:13–24CrossRefGoogle Scholar
- Meerovich V (1974) Turnover of financial funds and efficiency of production (Oborot Sredstv i Effektivnost’ Proizvodstva). Financy, Moscow
**(In Russian)**Google Scholar - Miller R, Blair P (2009) Input–output analysis: foundations and extensions. Cambridge University Press, CambridgeCrossRefGoogle Scholar
- Mudakkar S, Zaman K, Khan M, Ahmad M (2013) Energy for economic growth, industrialization, environment, and natural resources: living with just enough. Renew Sustain Energy Rev 25:580–595CrossRefGoogle Scholar
- Oliveira C, Antunes C (2004) A multiple objective model to deal with economy–energy–environment interactions. Eur J Oper Res 153(2):370–385CrossRefGoogle Scholar
- Paasche H (1874) Über die Preisentwicklung der letzten Jahre nach den Hamburger Börsennotirungen. Jahrbücher für Nationalökonomie und Statistik 23:168–178
**(In German)**Google Scholar - Perez-Suarez R, Lopez-Menendez A (2015) Growing green? Forecasting CO
_{2}emissions with environmental Kuznets curves and logistic growth models. Environ Sci Policy 54:428–437CrossRefGoogle Scholar - Polak E (1997) Optimization: algorithms and consistent approximations. Springer, New YorkCrossRefGoogle Scholar
- Rosen J (1960) The gradient projection method for nonlinear programming. Part 1. Linear constraints. J Soc Ind Appl Math 8(1):181–217CrossRefGoogle Scholar
- Rosen J (1961) The gradient projection method for nonlinear programming. Part II. Nonlinear constraints. J Soc Ind Appl Math 9(4):514–532CrossRefGoogle Scholar
- Shahbaz M, Khan S, Tahir M (2013) The dynamic links between energy consumption, economic growth, financial development and trade in China: fresh evidence from multivariate framework analysis. Energy Econ 40:8–21CrossRefGoogle Scholar
- Sheremet A (ed) (1979) Economic analysis of business activity (Ekonomicheskii analiz khozyaistvennoi deyatel’nosti). Economika, Moscow
**(In Russian)**Google Scholar - Sheremet A, Dei G, Shapovalov V (1971) The method of the chain substitutions and development of the factorial analysis of the economic indicators (Metod tsepnykh podstanovok i sovershenstvovanie faktornogo analiza ekonomicheskikh pokazatelei). Vestnik Moskovskogo Universiteta, Ser. Ekonomika 4:62–69
**(In Russian)**Google Scholar - Smith A, Brown M (2015) Demand response: a carbon-neutral resource? Energy 85:10–22CrossRefGoogle Scholar
- Solomon S, Qin D, Manning M, Chen Z, Marquis M, Averyt K, Tignor M, Miller H (eds) (2007) Contribution of working group I to the fourth assessment report of the intergovernmental panel on climate change, Cambridge, United Kingdom and New York, NY, USAGoogle Scholar
- Song M, Wang S, Yu H, Yang L, Wu J (2011) To reduce energy consumption and to maintain rapid economic growth: analysis of the condition in China based on expended IPAT model. Renew Sustain Energy Rev 15:5129–5134CrossRefGoogle Scholar
- Spiegel M, Stephens L (2014) Statistics Schaum’s outline series, 5th edn. McGraw-Hill, New YorkGoogle Scholar
- Spiegel M, Lipschutz S, Spellman D (2009) Vector analysis and an introduction to tensor analysis. Schaum’s outline series, 2nd edn. McGraw-Hill, New YorkGoogle Scholar
- Springmann M, Zhang D, Karplus V (2015) Consumption-based adjustment of emissions-intensity targets: an economic analysis for China’s provinces. Environ Resour Econ 61(4):615–640CrossRefGoogle Scholar
- Su B, Ang B (2013) Input–output analysis of CO
_{2}emissions embodied in trade: competitive versus noncompetitive imports. Energy Policy 56:83–87CrossRefGoogle Scholar - Suh S (ed) (2009) Handbook of input–output economics in industrial ecology. Springer, DordrechtGoogle Scholar
- Thompson B (2004) Exploratory and confirmatory factor analysis: understanding concepts and applications. American Psychological Association, WashingtonCrossRefGoogle Scholar
- Thornley P, Gilbert P, Shackley S, Hammond J (2015) Maximizing the greenhouse gas reductions from biomass: the role of life cycle assessment. Biomass Bioenergy 81:35–43CrossRefGoogle Scholar
- Timmer M (ed) (2012) The world input–output database (WIOD): contents, sources and methods. WIOD Working Paper Number 10. Available at http://www.wiod.org/publications/papers/wiod10.pdf
- Trzaski A, Rucinska J (2015) Energy labeling of windows—possibilities and limitations. Sol Energy 120:158–174CrossRefGoogle Scholar
- Ukidwe N, Bakshi B (2007) Industrial and ecological cumulative energy consumption of the United States via the 1997 input–output benchmark model. Energy 32(9):1560–1592CrossRefGoogle Scholar
- Vaninsky A (1983) An extension of the integral method of economic analysis to the analysis of interrelated and derivative factors. Avtomatika i Telemekhanika 8:130–141. Available at http://www.mathnet.ru/php/archive.phtml?wshow=paper&jrnid=at&paperid=5200&option_lang=eng (
**In Russian**). English translation is available in Automation and Remote Control, 1984, 44, 8(2), 1074–1083 - Vaninsky A (1987) Factorial analysis of economic activity (Factornyi Analiz Khozyaistvennoi Deyatel’nosti). Financy i Statistika, Moskva
**(In Russian)**Google Scholar - Vaninsky A (2006) Computational method of finding optimal structural change in economic systems: an input–output projected-gradient approach. J Interdiscip Math 9(1):61–76CrossRefGoogle Scholar
- Vaninsky A (2009) Structural change optimization in input–output models. J Interdiscip Math 12(6):839–861CrossRefGoogle Scholar
- Vaninsky A (2014a) Factorial decomposition of CO
_{2}emissions: a generalized Divisia index approach. Energy Econ 45:389–400CrossRefGoogle Scholar - Vaninsky A (2014b) Optimal economic restructuring aimed at an optimal increase in GDP constrained by a decrease in energy consumption and CO
_{2}emissions. World Academy of Science, Engineering and Technology: International Science Index, 8(6), paper 18. Available at http://www.waset.org/Publications/?path=Publications - Vaninsky A, Meerovich V (1978) Problems of the methodology of analysis of the impact of structural change on the indicators of production efficiency (Voprosy metodologii analiza vliyaniya strukturnykh sdvigov na pokazateli effectivnosti proizvodstva). In: Proceedings of the national scientific conference “Economic leverages of the efficiency of using material, labor, finance, and natural resources”, vol 2. Central Economic—Mathematical Institute, Moskva, pp 105–107. (
**In Russian**)Google Scholar - Wang Y, Zhao H, Li L, Liu Z, Liang S (2013) Carbon dioxide emission drivers for a typical metropolis using input–output structural decomposition analysis. Energy Policy 58:312–318CrossRefGoogle Scholar
- Whittle R, Ellis R, Marshall I, Alcock P, Hutchison D, Mauthe A (2015) From responsibility to accountability: working creatively with distributed agency in office energy metering and management. Energy Res Soc Sci 10:240–249CrossRefGoogle Scholar
- Yuan X, Li L, Gou H, Dong T (2015) Energy and environmental impact of battery electric vehicle range in China. Appl Energy 157:75–84CrossRefGoogle Scholar
- Zhang H, Lahr M (2014) Can the carbonizing dragon be domesticated? Insights from a decomposition of energy consumption and intensity in china, 1987–2007. Econ Syst Res 26(2):119–140CrossRefGoogle Scholar
- Zhang X, Hu H, Zhang R, Deng S (2014) Interactions between China’s economy, energy and the air emissions and their policy implications. Renew Sustain Energy Rev 38:624–638CrossRefGoogle Scholar
- Zhang Z, Chen X, Heck P, Xue B, Liu Y (2015) Empirical study on the environmental pressure versus economic growth in China during 1991–2012. Resour Conserv Recycl 101:182–193CrossRefGoogle Scholar

## Copyright information

© Springer Science+Business Media New York 2017