Global Convergence, Planetary Habitability, and Structural Transformation

This paper investigates the relationship between global inequality, structural economic change, and planetary boundaries, offering both a historical analysis and a forward-looking vision of inclusive sustainability.
We construct a novel global dataset covering 1970–2025 that integrates population, economic, and environmental indicators—including income and wealth distributions, input–output matrices, productivity, and greenhouse gas emissions—across 57 countries and regions and eight production sectors. Using an environmentally extended multi-regional input–output framework, we analyze the historical drivers of emissions and assess the feasibility of global income convergence within ecological limits.
Our decomposition shows that structural change has played a limited role in reducing emissions over the past decades, with most reductions driven by technological improvements. Specifically, changes in sectoral composition lowered global emissions by only –2.4% between 2000 and 2022, compared to –26.8% from reductions in emission intensities. At the same time, emissions increased by +56% due to rising per capita consumption. These findings align with evidence on the slow pace of structural transformation (Hickel et al., 2022) and challenge the assumption that a more equal and sustainable future can be achieved through growth and market-driven reallocation alone (Aghion et al., 2025).
In response, we propose alternative scenarios for 2100 that are consistent with both a given temperature target and global income convergence. Adopting a demand-based approach focused on satisfying basic needs (Rao and Min, 2018) we show that a “just” global distribution, characterized by the elimination of between-country inequality and substantial reductions in within-country inequality, is attainable within the global carbon budget. Reaching this outcome requires major redistribution and increased investment in public goods. While it implies some decline in average per capita GDP in today’s high-income countries, only a small share of individuals would experience actual income losses.
Our findings call for rethinking inequality reduction not as a byproduct of economic growth, but as a deliberate global strategy to eradicate poverty while respecting planetary boundaries.