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Environmental Protection And Economic Growth

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Author Info
Kuhl Teles, Vladimir
A. Arraes, Ronaldo

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Abstract

This paper explores the link between environmental policy and economic growth by employing an extension of the AK Growth Model. We include a state equation for renewable natural resources. We assume that the change in environmental regulations induces costs and that economic agents also derive some utility from capital stock accumulation vis-`a-vis the environment. Using the Hopf bifurcation theorem, we show that cyclical environmental policy strategies are optimal, providing theoretical support for the Environmental Kuznets Curve.

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Paper provided by Escola de Economia de São Paulo, Getulio Vargas Foundation (Brazil) in its series Textos para discussão with number 194.

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Date of creation: 24 Aug 2009
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Handle: RePEc:fgv:eesptd:194

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  14. Reis, Ana Balcao, 2001. "Endogenous Growth and the Possibility of Eliminating Pollution," Journal of Environmental Economics and Management, Elsevier, vol. 42(3), pages 360-373, November. [Downloadable!] (restricted)
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  17. Serafy, Salah El & Goodland, Robert, 1996. "The importance of accurately measuring growth," Environment and Development Economics, Cambridge University Press, vol. 1(01), pages 116-119, February. [Downloadable!]
  18. John, A & Pecchenino, R, 1994. "An Overlapping Generations Model of Growth and the Environment," Economic Journal, Royal Economic Society, vol. 104(427), pages 1393-1410, November. [Downloadable!] (restricted)
  19. Clark, Colin W., 1996. "Operational environmental policies," Environment and Development Economics, Cambridge University Press, vol. 1(01), pages 110-113, February. [Downloadable!]
  20. Margulis, Sergio, 1992. "Back of the envelope estimates of environmental damage costs in Mexico," Policy Research Working Paper Series 824, The World Bank. [Downloadable!]
  21. Selden Thomas M. & Song Daqing, 1995. "Neoclassical Growth, the J Curve for Abatement, and the Inverted U Curve for Pollution," Journal of Environmental Economics and Management, Elsevier, vol. 29(2), pages 162-168, September. [Downloadable!] (restricted)
  22. Selvanathan, Saroja, 1987. "A Monte Carlo test of preference independence," Economics Letters, Elsevier, vol. 25(3), pages 259-261. [Downloadable!] (restricted)
  23. Wirl, Franz, 2000. "Optimal accumulation of pollution: Existence of limit cycles for the social optimum and the competitive equilibrium," Journal of Economic Dynamics and Control, Elsevier, vol. 24(2), pages 297-306, February. [Downloadable!] (restricted)
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  1. Fábio Henrique Granja e Barros & Bernardo Mueller & Jorge Madeira Nogueira, 2007. "Crescimento Econômico E Meio Ambiente: O Que Está Faltando Para Entender O Elo Entre Eles?," Anais do XXXV Encontro Nacional de Economia [Proceedings of the 35th Brazilian Economics Meeting] 100, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics]. [Downloadable!]
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