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How Economic Development Influences the Environment

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  • Seema Jayachandran

    (Department of Economics and School of Public and International Affairs, Princeton University, Princeton, New Jersey, USA)

Abstract

Reducing global poverty and addressing climate change and other environmental crises are among the most important challenges facing humanity today. This review discusses one way in which these problems are intertwined: how economic development affects the environment. I synthesize recent micro-empirical research on the environmental effects of economic development in low- and middle-income countries. The studies that I discuss identify the causal effects of specific aspects of economic development, such as greater household purchasing power, expanded access to credit, more secure property rights, technological progress, and stronger regulatory capacity. I conclude by outlining some gaps in the literature.

Suggested Citation

  • Seema Jayachandran, 2022. "How Economic Development Influences the Environment," Annual Review of Economics, Annual Reviews, vol. 14(1), pages 229-252, August.
    • Handle: RePEc:anr:reveco:v:14:y:2022:p:229-252
    DOI: 10.1146/annurev-economics-082321-123803
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    Cited by:

    1. Costa, Francisco J M & Szerman, Dimitri & Assunção, Juliano, 2024. "The Environmental Costs of Political Interference: Evidence from Power Plants in the Amazon," SocArXiv 6y7vk, Center for Open Science.
    2. Carreira, Igor & Costa, Francisco & Pessoa, João Paulo, 2024. "The deforestation effects of trade and agricultural productivity in Brazil," Journal of Development Economics, Elsevier, vol. 167(C).
    3. Safi, Adnan & Kchouri, Bilal & Elgammal, Walid & Nicolas, Melhim Khoury & Umar, Muhammad, 2024. "Bridging the green gap: Do green finance and digital transformation influence sustainable development?," Energy Economics, Elsevier, vol. 134(C).
    4. Teevrat Garg & Maulik Jagnani & Hemant K. Pullabhotla, 2022. "Structural transformation and environmental externalities," Papers 2212.02664, arXiv.org.
    5. Meeks, Robyn C. & Omuraliev, Arstan & Isaev, Ruslan & Wang, Zhenxuan, 2023. "Impacts of electricity quality improvements: Experimental evidence on infrastructure investments," Journal of Environmental Economics and Management, Elsevier, vol. 120(C).
    6. Merkus, Erik, 2024. "The economic consequences of environmental enforcement: Evidence from an anti-deforestation policy in Brazil," World Development, Elsevier, vol. 181(C).
    7. João Pedro Vieira & Ricardo Dahis & Juliano Assunção, 2023. "The Role of Sanctions and Spillovers in Forest Conservation," Monash Economics Working Papers 2023-16, Monash University, Department of Economics.
    8. Babar Nawaz Abbasi & Zhimin Luo & Ali Sohail & Liu Yang & Liang Huimin & Chen Rongrong, 2024. "Global Shocks of Education, Health, and Environmental Footprint on National Development in the Twenty-First Century: A Threshold Structural VAR Analysis," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 992-1028, March.
    9. Aguilar-Gomez, Sandra & Cárdenas, Juan Camilo & Galindo, Camila & Rodríguez-Arenas, Jorge & Vlasak-González, Daniela, 2024. "Gender Gaps in Knowledge, Attitudes, and Practices Related to Environmental Degradation in Colombia," Documentos CEDE 21267, Universidad de los Andes, Facultad de Economía, CEDE.
    10. Brooks, Nina & Biswas, Debashish & Hossin, Raduan & Yu, Alexander & Saha, Shampa & Saha, Senjuti & Saha, Samir K. & Luby, Stephen P., 2023. "Health consequences of small-scale industrial pollution: Evidence from the brick sector in Bangladesh," World Development, Elsevier, vol. 170(C).
    11. Vieira, João Pedro & Dahis, Ricardo & Assunção, Juliano, 2023. "From Deforestation to Reforestation: The Role of General Deterrence in Changing Farmers' Behavior," SocArXiv vqpkm, Center for Open Science.
    12. Riekhof, Marie-Catherine & Noack, Frederik, 2024. "Nature’s decline and recovery — Structural change, regulatory costs, and the onset of resource use regulation," Journal of Environmental Economics and Management, Elsevier, vol. 125(C).
    13. Wellhausen, Rachel L, 2023. "Waste Not, Want Not: Tariffs as Environmental Protection," Institute on Global Conflict and Cooperation, Working Paper Series qt40m4179x, Institute on Global Conflict and Cooperation, University of California.
    14. Meng-Ting Chen & Shiyan Zhang & Jiakai Zhang, 2024. "Carbon emissions from the perspective of regional competition: evidence from China’s low-carbon city policy," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 73(2), pages 467-491, August.
    15. Bennedsen, Mikkel & Hillebrand, Eric & Jensen, Sebastian, 2023. "A neural network approach to the environmental Kuznets curve," Energy Economics, Elsevier, vol. 126(C).
    16. Long, Hai & Li, Wen-Wei & Otrakçı, Caner, 2023. "Sustaining environment through natural resource and human development: Revisiting EKC curve in China through BARDL," Resources Policy, Elsevier, vol. 85(PB).
    17. Tian, Jinfang & Sun, Siyang & Cao, Wei & Bu, Di & Xue, Rui, 2024. "Make every dollar count: The impact of green credit regulation on corporate green investment efficiency," Energy Economics, Elsevier, vol. 130(C).
    18. Keyi Duan & Mingyao Cao & Nurhafiza Abdul Kader Malim & Yan Song, 2024. "Between Prosperity and Preservation: An Empirical Analysis of the Interaction Between Economic Development and Environmental Awareness," Growth and Change, Wiley Blackwell, vol. 55(4), December.
    19. Uttam Paudel & Shiva Raj Adhikari & Krishna Prasad Pant, 2023. "Willingness to Pay for Environmental Quality Improvement Programs and Its Determinants: Empirical Analysis in Western Nepal," Sustainability, MDPI, vol. 15(3), pages 1-20, January.
    20. Wang, Erhong & Padhan, Hemachandra & Pruseth, Sujit Kumar & Ma, Junwei, 2024. "Government efficiency, green technology, and ecological footprint: Strategic framework for natural resource management efficiency targets," Resources Policy, Elsevier, vol. 91(C).
    21. Dan Xie, 2024. "China’s Manufacturing Pollution, Environmental Regulation and Trade," FIW Working Paper series 198, FIW.

    More about this item

    Keywords

    environmental conservation; economic growth; poverty reduction; environmental Kuznets curve;
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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