Can The World Industrialize Without Overheating? Pardee's IFs Charts A Path

By: Megan Livengood

Developed at the University of Denver, the Pardee Institute's International Futures (IFs) model is now helping to shape how the world's leading industrial agency plans for decades ahead. Faster industrialization can be compatible with lower emissions when it is aligned with clean energy and equity goals, according to the United Nations Industrial Development Organization (UNIDO) flagship, Industrial Development Report 2026 (IDR 2026), released on November 26, 2025, during the Global Industry Summit 2025. In this report, UNIDO looks beyond the immediate future to explore how decisions around industrialization and development today can have transformative effects for the next generation.

For the IDR 2026, UNIDO, working with the Pardee Institute, used IFs, to understand how transformative megatrends, like demographic shifts and energy transitions, are likely to shape the future of industrialization and development. The analysis, led by Taylor Hanna and Abdelrahman Ibrahim and supported by Collin J. Meisel, José Solórzano, Yutang Xiong, and Pardee Fellows, Solikha Makhmatova, and Victoria Pepera, evaluates future scenarios for leveraging industrial development for growth in developing countries. The projections capture both the opportunities for inclusive and sustainable growth and the risks that industrial inequality will deepen if capabilities and investment remain concentrated.

The findings underscore what's at stake. Under the current path scenario, where existing policies and trends largely continue, IFs projections for 2050 estimate around 3.15 billion people living below the poverty line¹, 303 million people facing undernourishment, and a global temperature rise by roughly 2.3°C.

Using IFs, UNIDO then models two alternative futures for 2050: an industrialization push scenario and a clean energy and just industrialization push scenario. In the industrialization push scenario, 403 million fewer people are projected to live in poverty, and 33 million fewer people face undernourishment, but CO2 emissions rise by over 2% globally. In the clean energy and just industrialization push scenario, 525 million fewer people live in poverty, 52 million fewer people face undernourishment, and global CO2 emissions fall by 6%.

The launch of IDR 2026 and the adoption of Vision 2050 mark a critical turning point because UNIDO is grounding long-term industrial strategy in an integrated systems-based modeling approach rather than short-term analysis. Understanding how industrial growth interacts with energy systems, emissions, demographics, and human development over decades requires analytical tools capable of capturing feedbacks, trade-offs, and uncertainty.

Built on the International Futures (IFs) model, Pardee's empirical model enables policymakers to explore other development pathways, rather than a single trajectory. IFs enables analysis of how different development strategies may shape inequality, sustainability, and resilience over the long term.

The collaboration reinforces a core insight: building a sustainable and inclusive global industrial future will require not only technological and financial transformation, but also the analytical tools to understand where the world is headed and what alternative paths are possible.

1. World Bank defined upper-middle-income poverty line of $8.30 per person per day