IDEAS home Printed from https://ideas.repec.org/a/ucp/epolec/doi10.1086-706798.html
   My bibliography  Save this article

Long-Run Environmental Accounting in the US Economy

Author

Listed:
  • Nicholas Z. Muller

Abstract

This paper estimates an augmented measure of national output inclusive of environmental pollution damage in the US economy over a 60-year period. The paper reports two primary findings. First, air pollution intensity declined precipitously from the 1950s to the modern era. Air pollution damage comprised roughly 30% of output in the post–World War II economy, declining to under 10% in 2016. Second, accounting for pollution damage significantly affects growth rates.Prior to the passage of the Clean Air Act in 1970, gross domestic product outpaced environmentally adjusted value added (EVA), defined as GDP less air pollution damage. Following passage of the act, EVA grew more rapidly than GDP. Macroeconomic and environmental policies, as well as the business cycle, appreciably affect damages and EVA growth.

Suggested Citation

  • Nicholas Z. Muller, 2020. "Long-Run Environmental Accounting in the US Economy," Environmental and Energy Policy and the Economy, University of Chicago Press, vol. 1(1), pages 158-191.
  • Handle: RePEc:ucp:epolec:doi:10.1086/706798
    DOI: 10.1086/706798
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/706798
    Download Restriction: Access to the online full text or PDF requires a subscription.

    File URL: http://dx.doi.org/10.1086/706798
    Download Restriction: Access to the online full text or PDF requires a subscription.

    File URL: https://libkey.io/10.1086/706798?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Tatyana Deryugina & Garth Heutel & Nolan H. Miller & David Molitor & Julian Reif, 2019. "The Mortality and Medical Costs of Air Pollution: Evidence from Changes in Wind Direction," American Economic Review, American Economic Association, vol. 109(12), pages 4178-4219, December.
    2. Dora L. Costa & Matthew E. Kahn, 2004. "Changes in the Value of Life, 1940--1980," Journal of Risk and Uncertainty, Springer, vol. 29(2), pages 159-180, September.
    3. Marian R. Chertow, 2000. "The IPAT Equation and Its Variants," Journal of Industrial Ecology, Yale University, vol. 4(4), pages 13-29, October.
    4. Akshaya Jha & Peter H. Matthews & Nicholas Z. Muller, 2019. "Does Environmental Policy Affect Income Inequality? Evidence from the Clean Air Act," AEA Papers and Proceedings, American Economic Association, vol. 109, pages 271-276, May.
    5. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    6. Robert J. Gordon, 2016. "Perspectives on The Rise and Fall of American Growth," American Economic Review, American Economic Association, vol. 106(5), pages 72-76, May.
    7. Hammitt James K. & Robinson Lisa A, 2011. "The Income Elasticity of the Value per Statistical Life: Transferring Estimates between High and Low Income Populations," Journal of Benefit-Cost Analysis, De Gruyter, vol. 2(1), pages 1-29, January.
    8. Hammitt James K. & Robinson Lisa A, 2011. "The Income Elasticity of the Value per Statistical Life: Transferring Estimates between High and Low Income Populations," Journal of Benefit-Cost Analysis, De Gruyter, vol. 2(1), pages 1-29, January.
    9. Le Kama, Alain Ayong & Schubert, Katheline, 2007. "A Note On The Consequences Of An Endogenous Discounting Depending On The Environmental Quality," Macroeconomic Dynamics, Cambridge University Press, vol. 11(2), pages 272-289, April.
    10. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 71-102, October.
    11. Clay, Karen & Lewis, Joshua & Severnini, Edson R., 2016. "Canary in a Coal Mine: Infant Mortality, Property Values, and Tradeoffs Associated with Mid-20th Century Air Pollution," IZA Discussion Papers 9884, Institute of Labor Economics (IZA).
    12. Baumol, William J, 1986. "Productivity Growth, Convergence, and Welfare: What the Long-run Data Show," American Economic Review, American Economic Association, vol. 76(5), pages 1072-1085, December.
    13. Six, M. & Wirl, F., 2015. "Optimal pollution management when discount rates are endogenous," Resource and Energy Economics, Elsevier, vol. 42(C), pages 53-70.
    14. -, 2009. "The economics of climate change," Sede Subregional de la CEPAL para el Caribe (Estudios e Investigaciones) 38679, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    15. Jha, Akshaya & Muller, Nicholas Z., 2018. "The local air pollution cost of coal storage and handling: Evidence from U.S. power plants," Journal of Environmental Economics and Management, Elsevier, vol. 92(C), pages 360-396.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Giovanardi, Francesco & Kaldorf, Matthias & Radke, Lucas & Wicknig, Florian, 2022. "The preferential treatment of green bonds," Discussion Papers 51/2022, Deutsche Bundesbank.
    2. Francesco Giovanardi & Matthias Kaldorf & Lucas Radke & Florian Wicknig, 2023. "The Preferential Treatment of Green Bonds," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 51, pages 657-676, December.
    3. Clay, Karen & Jha, Akshaya & Lewis, Joshua & Severnini, Edson R., 2021. "Impacts of the Clean Air Act on the Power Sector from 1938-1994: Anticipation and Adaptation," IZA Discussion Papers 14494, Institute of Labor Economics (IZA).
    4. Francesco Giovanardi & Matthias Kaldorf & Lucas Radke & Florian Wicknig, 2023. "The Preferential Treatment of Green Bonds," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 51, pages 657-676, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Muller, Nicholas Z., 2019. "The derivation of discount rates with an augmented measure of income," Journal of Environmental Economics and Management, Elsevier, vol. 95(C), pages 87-101.
    2. Fouquet, Roger, 2011. "Long run trends in energy-related external costs," Ecological Economics, Elsevier, vol. 70(12), pages 2380-2389.
    3. James K. Hammitt, 2020. "Valuing mortality risk in the time of COVID-19," Journal of Risk and Uncertainty, Springer, vol. 61(2), pages 129-154, October.
    4. Kostakis, Ioannis & Lolos, Sarantis & Doulgeraki, Charikleia, 2020. "Cultural Heritage led Growth: Regional evidence from Greece (1998-2016)," MPRA Paper 98443, University Library of Munich, Germany.
    5. Miketa, Asami & Mulder, Peter, 2005. "Energy productivity across developed and developing countries in 10 manufacturing sectors: Patterns of growth and convergence," Energy Economics, Elsevier, vol. 27(3), pages 429-453, May.
    6. Pozzolo, Alberto Franco, 2004. "Endogenous Growth in Open Economies - A Survey of Major Results," Economics & Statistics Discussion Papers esdp04020, University of Molise, Department of Economics.
    7. Carolina Arteaga Cabrales, 2011. "Human Capital Externalities and Growth," Revista ESPE - Ensayos Sobre Política Económica, Banco de la República, vol. 29(66), pages 12-47, December.
    8. Iryna Kalenyuk & Liudmyla Tsymbal, 2021. "Assessment of the intellectual component in economic development," Scientometrics, Springer;Akadémiai Kiadó, vol. 126(6), pages 4793-4816, June.
    9. Bloom, David E. & Canning, David & Kotschy, Rainer & Prettner, Klaus & Schünemann, Johannes, 2024. "Health and economic growth: Reconciling the micro and macro evidence," World Development, Elsevier, vol. 178(C).
    10. Adriana Di Liberto, 2007. "Convergence and Divergence in Neoclassical Growth Models with Human Capital," Economia politica, Società editrice il Mulino, issue 2, pages 289-322.
    11. Jan Fagerberg, 1999. "Technology, Policy, Growth - Theory, Evidence and Interpretation," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 25, pages 5-14.
    12. Moritz A. Drupp & Martin C. Hänsel, 2021. "Relative Prices and Climate Policy: How the Scarcity of Nonmarket Goods Drives Policy Evaluation," American Economic Journal: Economic Policy, American Economic Association, vol. 13(1), pages 168-201, February.
    13. Robert J. Barro & Xavier Sala-i-Martin, 1990. "Economic Growth and Convergence across The United States," NBER Working Papers 3419, National Bureau of Economic Research, Inc.
    14. Hallegatte, Stephane & Heal, Geoffrey & Fay, Marianne & Treguer, David, 2011. "From growth to green growth -- a framework," Policy Research Working Paper Series 5872, The World Bank.
    15. Gianmarco León & Edward Miguel, 2017. "Risky Transportation Choices and the Value of a Statistical Life," American Economic Journal: Applied Economics, American Economic Association, vol. 9(1), pages 202-228, January.
    16. Bayraktar-Sağlam, Bahar & Yetkiner, Hakan, 2014. "A Romerian contribution to the empirics of economic growth," Journal of Policy Modeling, Elsevier, vol. 36(2), pages 257-272.
    17. Paul M. Romer, 1994. "The Origins of Endogenous Growth," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 3-22, Winter.
    18. Taylor, Alan M., 1999. "Sources of convergence in the late nineteenth century," European Economic Review, Elsevier, vol. 43(9), pages 1621-1645, October.
    19. Nijkamp, Peter & Poot, Jacques, 1993. "Endogenous Technological Change, Innovation Diffusion and Transitional Dynamics in a Nonlinear Growth Model," Australian Economic Papers, Wiley Blackwell, vol. 32(61), pages 191-213, December.
    20. Peter Mulder & Henri Groot, 2007. "Sectoral Energy- and Labour-Productivity Convergence," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 36(1), pages 85-112, January.

    More about this item

    JEL classification:

    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • 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
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucp:epolec:doi:10.1086/706798. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/EEPE .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.