The drag effect of coal consumption on economic growth in China during 1953-2013

Rapid economic growth in China is largely dependent on coal consumption, so the scarcity of coal represents a major challenge for sustainable development in the country. A model predicting the drag effect of coal consumption on economic growth in China would be useful for decision-making. In this paper, we apply Romer's growth drag theory and estimate the drag effect of coal consumption on economic growth using a Johansen cointegration test, partial least squares regression, and a drag equation. The results show that the growth drag caused by coal consumption is 0.0252. This means that regardless of other factors, the economic growth rate will be 6.34% in 2020 due to the constraints of coal consumption. We also present suggestions for improving the efficiency and controlling the scale of coal usage during economic development.