Relationship Between Coal Production and GDP

Sam Pfeil
June 12, 2018

Submitted as coursework for PH241, Stanford University, Winter 2018

Introduction

Fig. 1: Shozhou Coal Power Plant (Source: Wikimedia Commons)

To understand the role that coal production plays on a country's total Gross Domestic Product (GDP), I sought to compare a country's annual GDP to its share of coal production. There are a couple of potential relationships:

A higher share of coal production is linked to more manufacturing, and therefore higher GDP
A higher share of coal production is linked to less developed countries, and therefore lower GDP. This would likely mean that more developed countries rely on other sources of energy, such as nuclear energy.

The Shozhou coal power plant in China is shown in Fig. 1.

Data Sources

In order to measure the relationship, I used statistics from the World Bank and the BP Statistical Review of World Energy 2017. World Bank provides data about GDP by country, while the BP Statistical Review of World Energy provides shares of coal production by country for the year 2016. The three top world GDP's belong to the United States, China, and Japan. [1]

Results

Country	Rank	Total GDP (U.S Dollars)	Coal Production (Joules)	Ratio ($/Joule)
United States	1	$1.86 × 10¹³	1.6 × 10¹⁹	1.16 × 10^-6
China	2	$1.12 × 10¹³	7.42 × 10¹⁹	1.51 × 10^-7
Japan	3	$4.94 × 10¹²	3.08 × 10¹⁶	1.6 × 10^-4
Canada	10	$1.53 × 10¹²	1.38 × 10¹⁸	1.11 × 10^-6
Uzbekistan	70	$6.72 × 10¹²	4.84 × 10¹⁶	1.39 × 10^-6
Zimbabwe	112	$1.66 × 10¹⁰	7.48 × 10¹⁶	2.22 × 10^-7

Table 1: Coal Production and GDP.

Based on the figures from Table 1, there does not seem to be a relationship between GDP and coal production.

Conclusion

Although there does not appear to be a direct relationship between GDP and coal production, it is important to note that the US and China produce over half of the worlds coal. [2] Their GDPs are also an order of magnitude larger than any other country. As we can see, most countries produce a similar amount of GDP per Joule of coal energy produced with the exception of Japan. Japan also has very low coal production, so it is probably an outlier to this general value calculated for other countries. Japan produces less coal, but each Joule of coal produced produces more GDP than the countries it is being compared to. The governments of countries with disproportionate coal production to GDP should consider policy actions to discourage coal production for alternate sources of energy.

© Sam Pfeil. The author warrants that the work is the author's own and that Stanford University provided no input other than typesetting and referencing guidelines. The author grants permission to copy, distribute and display this work in unaltered form, with attribution to the author, for noncommercial purposes only. All other rights, including commercial rights, are reserved to the author.

References

[1] "Gross Domestic Product 2016," World Bank, 17 Apr 18.

[2] "BP Statistical Review of World Energy 2017," British Petroleum, June 2017.