Catalina Espinosa
Research expert covering society, economy, and politics for Europe and the EU
Get in touch with us nowEU gross domestic product (GDP) and domestic material consumption (DMC) 2000-2021
The European Union's domestic material consumption (DMC), that is, the total amount of materials used annually within the European economy, has partially decoupled from gross domestic product (GDP), the total monetary value of goods and services produced in the economy, over the period since the global financial crisis of 2007-2008. Historically, GDP and DMC have been tightly linked, with an increase in production resulting in an increase in the use of materials - a logical relationship in an industrial economy based on making goods out of raw materials. As industries within the European Union have made significant progress in energy efficiency, sustainability, and in providing intangible goods or services which are much less material-intensive, the level of material consumption has experienced a relative decline, even while the economy has continued to grow.
A key debate in policy circles is whether this reduction in material throughput can be achieved while maintaining economic growth. While the EU has seen its material consumption partially decouple from its economic production, critics claim that this is not being achieved at a fast enough pace in order to avoid environmental breakdown. These critics therefore suggest that the EU, along with the other rich regions and countries which have been responsible for the majority of global emissions historically, needs to pursue degrowth, that is, the intentional downscaling of economic production in order to reduce emissions and material consumption. The political and economic feasibility of degrowth has been questioned by other experts, who claim that the EU is better advised to pursue further decoupling of material and energy throughput, while maintaining its commitment to a growing economy.
Degrowth or decoupling?
With climate change, global warming, and the depletion of the Earth's natural resources being the greatest challenges which humanity is facing in the twenty-first century, increasing attention is being paid to how countries and regions can rapidly decrease their consumption of resources and materials. While the green energy transition is usually the main focus of this, reducing DMC is an equally great challenge, which will require investments in industries and technologies which support sustainability and the circular economy.A key debate in policy circles is whether this reduction in material throughput can be achieved while maintaining economic growth. While the EU has seen its material consumption partially decouple from its economic production, critics claim that this is not being achieved at a fast enough pace in order to avoid environmental breakdown. These critics therefore suggest that the EU, along with the other rich regions and countries which have been responsible for the majority of global emissions historically, needs to pursue degrowth, that is, the intentional downscaling of economic production in order to reduce emissions and material consumption. The political and economic feasibility of degrowth has been questioned by other experts, who claim that the EU is better advised to pursue further decoupling of material and energy throughput, while maintaining its commitment to a growing economy.
