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Economic growth and pollution in the long run: the case of carbon dioxide

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  • Burke, Paul J.

Abstract

The concept underpinning the Environmental Kuznets Curve is that economic growth results in reduced pollution in the long run. In this report, an extension of Andreoni and Levinson’s (2001) theoretical model is presented. It demonstrates that an Environmental Kuznets Curve relationship can occur because high incomes allow more adoption of low-emission technologies at higher income levels. Evidence on the determinants of carbon dioxide emissions changes for OECD countries over the period 1961-2004 is presented. It highlights the importance of technology adoption in explaining whether countries have achieved emissions reductions at the same time as experiencing long-run economic growth. However, it is shown that technology adoption is affected by policy decisions and other factors in addition to income level. Hence the Environmental Kuznets Curve hypothesis is more appropriately framed as a conditional relationship.

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  • Burke, Paul J., 2008. "Economic growth and pollution in the long run: the case of carbon dioxide," Research Reports 94804, Australian National University, Environmental Economics Research Hub.
    • Handle: RePEc:ags:eerhrr:94804
    DOI: 10.22004/ag.econ.94804
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    1. Holtz-Eakin, Douglas & Selden, Thomas M., 1995. "Stoking the fires? CO2 emissions and economic growth," Journal of Public Economics, Elsevier, vol. 57(1), pages 85-101, May.
    2. World Bank, 2008. "World Development Indicators 2008," World Bank Publications - Books, The World Bank Group, number 28241.
    3. World Bank, 2008. "World Development Indicators 2008," World Bank Publications - Books, The World Bank Group, number 11855.
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    Environmental Economics and Policy;

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