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Economic Growth and Environmental Degradation

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  • Burnett, J. Wesley

Abstract

Economists, ecologists, private industries and government decision-makers have long been interested in the relationships between economic growth and environmental quality. These relationships are often the subject of intense public policy debates such as the current debate surrounding global climate change issues. From an ecological or environmental perspective, the argument is often made that economic growth is bad for the environment. But, what story do the data tell? In order to address the question, a estimable model was used to analyze the effects between gross domestic product (GDP) and environmental indications for air pollution in over 100 metropolitan statistical areas in the United States from 2001-2005. The analysis is then expanded to examine the estimable relationship at the state level. The air pollution indicators include ozone, carbon monoxide, nitrogen dioxide, sulfur dioxide, and particulate matter. The results are mixed results. This study finds a statistically significant U-shaped relationship for some of the pollutants; however, the evidence is pretty weak with the exception of ground level ozone. This study does not find evidence to support the traditional EKC inverse U-shaped relationship. These results are compared and contrasted to previous studies providing insight into unresolved theoretical and empirical estimation issues and future research needs.

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Bibliographic Info

Paper provided by Southern Agricultural Economics Association in its series 2009 Annual Meeting, January 31-February 3, 2009, Atlanta, Georgia with number 46838.

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Date of creation: 2009
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Handle: RePEc:ags:saeana:46838

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Keywords: Air Pollution; Environmental Economics; Environmental Kuznets Curve; Fixed effects regression; Environmental Economics and Policy;

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  1. Grossman, G.M & Krueger, A.B., 1991. "Environmental Impacts of a North American Free Trade Agreement," Papers 158, Princeton, Woodrow Wilson School - Public and International Affairs.
  2. James Andreoni & Arik Levinson, 1998. "The Simple Analytics of the Environmental Kuznets Curve," NBER Working Papers 6739, National Bureau of Economic Research, Inc.
  3. Dinda, Soumyananda, 2004. "Environmental Kuznets Curve Hypothesis: A Survey," Ecological Economics, Elsevier, vol. 49(4), pages 431-455, August.
  4. Susmita Dasgupta & Benoit Laplante & Hua Wang & David Wheeler, 2002. "Confronting the Environmental Kuznets Curve," Journal of Economic Perspectives, American Economic Association, vol. 16(1), pages 147-168, Winter.
  5. Deacon, Robert & Norman, Catherine S, 2004. "Is the environmental Kuznets curve an empirical regularity?," University of California at Santa Barbara, Economics Working Paper Series qt2m44f7kr, Department of Economics, UC Santa Barbara.
  6. Selden Thomas M. & Song Daqing, 1994. "Environmental Quality and Development: Is There a Kuznets Curve for Air Pollution Emissions?," Journal of Environmental Economics and Management, Elsevier, vol. 27(2), pages 147-162, September.
  7. Lopez, Ramon & Mitra, Siddhartha, 2000. "Corruption, Pollution, and the Kuznets Environment Curve," Journal of Environmental Economics and Management, Elsevier, vol. 40(2), pages 137-150, September.
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