How do improvements in labour productivity in the Scottish economy affect the UK position on the Environmental Kuznets Curve?
AbstractThe Environmental Kuznets Curve (EKC) hypothesis focuses on the argument that rising prosperity will eventually be accompanied by falling pollution levels as a result of one or more of three factors: (1) structural change in the economy; (2) demand for environmental quality increasing at a more-than-proportional rate; (3) technological progress. Here, we focus on the third of these. In previous work we have used single region/nation models of the Scottish and UK economies to simulate the impacts of increased labour and energy efficiency on the domestic economyâ€™s position on the EKC, with a specific focus on CO2 emissions. There we find that, while the impacts of an increase in energy efficiency are difficult to predict, mainly due to the potential for â€˜reboundâ€™ effects, while increasing CO2 emissions, improved labour productivity is likely to move an economy along its EKC through more rapid GDP growth. However, recent developments in the EKC literature have raised the issue of whether this will still be the case if emissions are accounted for from a consumption rather than a production perspective (the â€˜pollution leakageâ€™ hypothesis) â€“ i.e. taking account of indirect pollution generation embodied in trade flows rather than just domestic emissions generation. Here we extend our earlier single region analysis for Scotland by using an interregional CGE model of the UK economy to examine the likely impacts of an increase in Scottish labour productivity on the rest of the UK and on a national EKC through interregional labour migration and trade flows.
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Bibliographic InfoPaper provided by University of Strathclyde Business School, Department of Economics in its series Working Papers with number 0915.
Length: 27 pages
Date of creation: Jun 2009
Date of revision:
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More information through EDIRC
computable general equilibrium; technological progress; environmental kuznets curve; pollution leakage;
Other versions of this item:
- Turner, Karen & Hanley, Nick, 2009. "How do improvements in labour productivity in the Scottish economy affect the UK position on the Environmental Kuznets Curve?," SIRE Discussion Papers 2009-34, Scottish Institute for Research in Economics (SIRE).
- D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
- F18 - International Economics - - Trade - - - Trade and Environment
- O13 - Economic Development, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-07-11 (All new papers)
- NEP-CMP-2009-07-11 (Computational Economics)
- NEP-EFF-2009-07-11 (Efficiency & Productivity)
- NEP-ENE-2009-07-11 (Energy Economics)
- NEP-ENV-2009-07-11 (Environmental Economics)
- NEP-SBM-2009-07-11 (Small Business Management)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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0903, University of Strathclyde Business School, Department of Economics.
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