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Sustainable economic development and the environment

Author

Listed:
  • Bertinelli, Luisito

    (Center for Mathematical Economics, Bielefeld University)

  • Strobl, Eric

    (Center for Mathematical Economics, Bielefeld University)

  • Zou, Benteng

    (Center for Mathematical Economics, Bielefeld University)

Abstract

The relationship between growth and pollution is studied through a vintage capital model, where new technology is more environmentally friendly. We find that once the optimal scrapping age of technologies is reached, an economy may achieve two possible cases of sustainable development, one in which pollution falls and another in which it stabilizes, or a catastrophic outcome, where environmental quality reaches its lower bound. The outcome will depend on countries' investment path and their propensity to innovate in environmentally clean technologies, both of which are likely to differ across economies. Empirical results using long time series for a number of developed and developing countries indeed confirm heterogeneous experiences in the pollution-output relationship.

Suggested Citation

  • Bertinelli, Luisito & Strobl, Eric & Zou, Benteng, 2011. "Sustainable economic development and the environment," Center for Mathematical Economics Working Papers 369, Center for Mathematical Economics, Bielefeld University.
  • Handle: RePEc:bie:wpaper:369
    as

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    File URL: https://pub.uni-bielefeld.de/download/2315437/2319790
    File Function: First Version, 2005
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    References listed on IDEAS

    as
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    Cited by:

    1. Park, Soonae & Lee, Youngmi, 2011. "Regional model of EKC for air pollution: Evidence from the Republic of Korea," Energy Policy, Elsevier, vol. 39(10), pages 5840-5849, October.

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