Modelling
5 Results of the simulations and analysis
5.1 Baseline projection (BAU)
The baseline projection of the T21-World model is modelled on the assumption that current trends will continue, with only minor progress shifting to a green economy (e.g. high energy use and emissions and continued unsustainable exploitation of natural resources). Total population is projected to grow by 29 per cent in the period 2010 – 2050, reaching 8.9 billion people, matching historical data from WDI and future projections from WPP (Figure 4). These WPP projections are based on continuing declines in fertility, and dependent on population policies and programmes, including universal access to sexual and reproductive health. When looking at the population pyramid, we see that when under-five mortality rates decline and life expectancy increases the population will become more equally distributed across age cohorts. Employment is projected to increase to 4.6 billion in 2050, driven by economic growth.11
Real GDP, endogenously simulated
by the model, is in fact projected to grow by 2 per cent per year on average between 2010 and 2050, reaching US$ 151.3 trillion, or US$ 17,068 per capita, using 2010 as the constant US dollar base year,12
which compares to
historical data from WDI. As a result of economic growth, the proportion of people living below the poverty line will decline to 16.8 per cent in 2020 and 11.1 per cent in 2050 and the income distribution will improve over time, with more people being lifted out of poverty and into higher income classes.13
In line with the overall GDP growth, the value added generated by agriculture, industry and service sectors is projected to increase by 0.7 per cent, 1.9 per cent, and 2.1 per cent per year on average respectively between
11. Note that although the T21-World model does not incorporate an explicit labour market, it does not assume full employment.
12. Note: All monetary values in the chapter are presented in constant 2010 US dollars.
13. T21-World projects income but not inequality. Gini coefficients are assumed, following historical trends, and income distribution in this chapter indicates how many people are living in each income class, including those below the poverty line. As a result, changes in projected poverty levels are largely driven by the simulated level of income (endogenously determined and impacted by the investment assumed). We estimate poverty levels using economic indicators (e.g. income), but do also consider access to basic services (without calculating an aggregated indicator accounting for social and monetary factors at once). Since it is unfair to reduce poverty to monetary poverty only, we consider social aspects as well in broader poverty-related considerations.
7 6 5
4 3
2 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Figure 5: Simulation of total volume of crop yield in BAU compared with values of FAOSTAT
515
Billion people 10
World Population Prospects scenario BAU scenario
8
2010 and 2050, accounting for 1.4 per cent, 23.4 per cent, and 75.2 per cent of real GDP in 2050. At this time, the share of total employment by sector will be: 32.3 per cent (agriculture), 23 per cent (industry), 39.3 per cent (service), and more specifically, 0.3 per cent (fisheries), 0.5 per cent (forestry), 2.5 per cent (transportation), 0.4 per cent (energy), 0.5 per cent (waste) and 1.1 per cent (water). In the agriculture sector, total volume of crop yield (Figure 5) has increased by 1.8 per cent per annum between 1970 and 2009, following FAOSTAT values, and is projected to continue to grow by 0.8 per cent per year for the next 40 years. As a result, a projected 36 per cent growth in crop production value between 2010 and 2050 will improve the average nutrition level by 7 per cent over the simulation period. The fishery sector and forestry industry will contribute 0.04 per cent and 0.6 per cent of global GDP by 2050, with an average growth rate of -1.6 per cent and 0.3 per cent per year.
Owing to the growth of population and GDP, the world’s primary energy demand will grow by over 57 per cent in the coming decades, reaching 19,733 Mtoe in 2050. To meet the rising demand, the production
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4
PROJECTION
2 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Figure 4: Simulation of population in BAU compared with population values of WPP
Billion tonnes 8
BAU scenario FAOSTAT measures
PROJECTION
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