Dematerialization, degrowth, and climate change agenda


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Old Coca-Cola cans in museum.
Old Coca-Cola cans in museum. Yakov Oskanov /

Longwood Gardens, about a two-hour drive from Washington DC, are worth visiting at any time of the year. Located in Chester Country, Pennsylvania, these beautiful public gardens comprise intricate systems of fountains and ponds, meticulous flower beds, conservatories, and remarkable architecture. But few of more than a million visitors who enjoy the gardens every year know that the 61 farms, neighboring this former Pierre S. du Pont’s estate, produce 400 million pounds a year of mushrooms, almost half of total US production. Moving West, 80 percent of the 1.1 billion pounds of commercially grown pumpkins are cultivated within a 90-mile radius of Peoria, Illinois.

These are not isolated examples of the intensity of modern agriculture. The total crop tonnage in the United States tripled since the 1970s, but the cropland area shrunk from about 472 million to 390 million hectares by the 2010s, saving an area three times larger than the United States’ total urban area. Productivity gains in animal agriculture dramatically reduced the environmental footprint of livestock production in the US. Similar reductions in farmland accompanied by large increases in output are seen in countries of Europe, Latin America, and East Asia. The global footprint of agriculture has “started decreasing in size during the past two decades.”

US agriculture, having a positive trade balance, consumes 25 percent less fertilizer than it did in 1999, and the volume of water used for irrigation has decreased by 22 percent since then. Raising the average world farm productivity to the levels seen among US farmers would allow enough food to be grown to feed 10 billion people an American-type diet on half the land currently used for farming. The land released would exceed the area of Amazonia (7 million square kilometers).

Most developed countries are now in the stage of “forest transition,” when a country gains forest area. Europe is greener now than it was 100 years ago; the size of US forest resources remained constant over the 20th century and increased over the last decade. China is adding almost 2 million hectares (about 1 percent) of forests a year. And rates of global forest loss have been slowing since 1980.

At the same time, forestry has become more productive. Shifting wood harvest from the north to the southeast, where the forests are twice as productive, decreased the United States’ logged area by 3.1 million hectares. Forest plantations are much more productive than unmanaged forests: Brazilian eucalyptus plantations provide at least 10 times more timber per hectare per year than northern forests do. The consumption of wood is also declining. Ships and railroads are no longer built of wood. Globally, the use of wood for fuel and construction dropped sharply since the 1960s; the global demand for paper has been stagnant, decreasing across the developed countries over the last two decades. The footprint of the developed world on the planet, as an area occupied by human activities, is shrinking.

There has also been a marked decline in US consumption of the most economically important minerals. According to the US Geological Survey (USGS), since the end of the 20th century, US consumption of metals has fallen by 15 percent for steel, 30 percent for aluminum, and 40 percent for copper. The decline reflects increased efficiency. Aluminum soda cans are six times lighter than they were in the early 1960s, and cars weigh 30 percent less than they did. The introduction of high-strength steel framing, reinforced concrete, and stronger and lighter glass have reduced consumption of cement, stone, sand, and gravel in construction. US energy use has plateaued for more than a decade. Similar trends are observed in the UK, which began to reduce its consumption of physical resources between 2001 and 2003. Even individual caloric intake is falling in the UK, mainly because of the decline in most environmentally damaging meat consumption.

Off-shoring could affect the local consumption of national resources. Country statistics, which rely on a territorial perspective of material use, might fail to account for the global patterns of material consumption. What looks like “green growth” might be just an artifact of globalization. For example, some intermediate metal consumption might be hidden in imported finished merchandise like cars or trucks. While these are valid concerns, the reduction of materials used in agriculture, forestry, and construction appears to be largely isolated from such measurement issues. Actual consumption of these materials in developed countries is dropping; whether the material is imported or not is irrelevant.

The concept of dematerialization refers to an absolute or relative reduction in the quantity of materials required to serve economic functions in society. Unlike the traditional `end-of-pipe’ measures, dematerialization is an input-oriented strategy intended to reduce environmental damage at the source. The production and consumption of products, the so-called “industrial” and “social metabolisms,” could harm the environment. Reducing the volume of material and energy used to produce goods and services diminishes the environmental impact. But in contrast with the degrowth movement, which is based on the premise that environmental damage rises with population and economic growth, the proponents of dematerialization argue that societal metabolism might exhibit an inverted U-shaped relationship with economic growth. A country’s environmental impact rises as its national income grows but then declines after a (very) high level of GDP is reached. Similar argument is made by the recent literature on growth and pollution conversions.

If we believe these trends, the reduction (both relative and absolute) of material consumption observed in developed countries might have important policy implications. Growth in developed countries might not necessarily cause environmental distress and natural resource depletion. Advanced economies may be able to decouple economic growth and growing volumes of resource use. The new technologies are making the economic growth in developing countries greener and less material-intensive compared to the growth the now rich countries experienced at comparable income levels decades ago. 

Several factors drive dematerialization. Technological progress improves efficiency and reduces the consumption of resources in manufacturing. The digital economy “swaps bits for atoms,” replacing physical goods and services with their digital versions; 3D printing shifts technologies toward custom-designed components with little or no waste. Competition encourages companies to cut costs and use less materials. Citizens and governments are increasingly putting premiums on the environment, embracing policies to reduce social metabolism.  

The promotion of dematerialization will require substantial but feasible changes in models of mass production and consumption. Industry needs to intensify the use of products currently considered as waste or byproducts—as the European Union’s End-of-waste criteria do (EU plans to re-use at least 60 percent of municipal waste by 2030).  New technologies can produce goods from reusable, reconfigurable, and multifunctional materials (e.g., pace layering approach in architecture). Innovations can enhance circular material flows and help to close the resource loop. Digitization and digitalization have already reduced material consumption and will continue to do so (electronic books, streaming instead of physical DVDs, digital instead of paper maps, tickets, or physical securities). As industries adopt a Product-as-a-Service (PaaS) approach, moving from selling products to selling access to the outcomes these products deliver (people do not need washing machines, they need clean clothes), their environmental footprint will decline. Models like that range from car-sharing services, circular business models by Rolls-Royce, Xerox, Caterpillar, to services like Desso-Tarkett flooring company with a business model in which the company retains ownership over the flooring and take care of it after usage.       

Dematerialization through economic growth alone is not sufficient to achieve environmental goals within an acceptable timeframe, which would require halving the average annual material use in the world from its current level of 12 tons per person. But dematerialization has many advantages. Even people who maintain that growth may not be feasible or even necessarily desirable—or, at the other end of the political spectrum, deny that global climate change exists—are likely to support measures that improve the efficiency of processes; create lighter, smaller, and less polluting products; and shift to an economy in which products are replaced by services.

The dematerialization agenda overlaps to a large degree with the Circular Economy, a major component of the EU Green Deal. The international development institutions may want to consider mainstreaming resource efficiency into their development assistance programs.


Michael M. Lokshin

Lead Economist, Office of the Regional Chief Economist, Europe and Central Asia

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