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Economics and Environmental Development: Testing the Environmental Kuznets Curve Hypothesis

Author

Listed:
  • Ni Putu Wiwin Setyari

    (Universitas Udayana, Indonesia)

  • Wayan Gita Ayu Kusuma

    (Universitas Udayana, Indonesia)

Abstract

The Environmental Kuznets Curve (EKC) shows the relationship between economic development, which is proxied in per capita income, and environmental quality. This study aims to view the existence of the EKC by arranging the distribution of 62 countries into four sub-samples based on per capita income from 1992 to 2017. By applying panel data, the model uses the Error Correction Mechanism (ECM) method to see the effect of economic growth on environmental quality (CO2 emission) in both the short and the long term. The results show that the EKCs on our four subsamples used are not conclusive, and are more likely to refer to the N pattern. This result confirms that the impetus of development at a higher level will lead to a degradation of environmental quality. Therefore, policy intervention becomes an important thing.

Suggested Citation

  • Ni Putu Wiwin Setyari & Wayan Gita Ayu Kusuma, 2021. "Economics and Environmental Development: Testing the Environmental Kuznets Curve Hypothesis," International Journal of Energy Economics and Policy, Econjournals, vol. 11(4), pages 51-58.
    • Handle: RePEc:eco:journ2:2021-04-7
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    References listed on IDEAS

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    More about this item

    Keywords

    Macroeconomics; Government Policy; Sustainable Economic Growth; Environmental Economics; Panel Data;
    All these keywords.

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • 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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