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Abstract
This article provides a cross-country empirical analysis of the relationship between carbon dioxide (CO2) emissions and the stage of economic development, testing the hypothesis of the Environmental Kuznets Curve (EKC). The EKC hypothesis suggests that environmental degradation first increases with economic growth and then, after a certain level of income is reached, begins to decline. The study uses data from a wide range of developed and developing countries to examine the relationship between per capita income and per capita CO2 emissions. The research employs regression analysis to test for the inverted-U shape predicted by the EKC hypothesis. The paper's findings are discussed in the context of the global climate change debate. The analysis concludes by exploring the policy implications of this relationship, particularly whether developing countries are destined to follow the same pollution-intensive path as the industrialized nations, or whether they can "tunnel" through the curve by adopting cleaner technologies at an earlier stage of development.
Full Text
The relationship between economic growth and environmental quality is one of the most debated issues in development economics. This paper contributes to this debate through a cross-country analysis of the link between economic development, measured by per capita GDP, and carbon dioxide emissions. The study is framed around the concept of the Environmental Kuznets Curve (EKC), an influential hypothesis which posits that environmental problems initially worsen as a country industrializes, but then improve as it becomes wealthier and can afford to invest in cleaner technologies. The core of the paper is an econometric analysis of data from a large sample of countries at different stages of development. It tests whether the data supports the inverted-U shaped relationship between income and CO2 emissions that is predicted by the EKC theory. The findings of the statistical analysis are then interpreted in the broader context of the global climate challenge. The paper discusses whether the EKC pattern, even if it holds true for some pollutants, is applicable to a global pollutant like CO2, where the costs of abatement are borne locally but the benefits are global. The analysis concludes with a discussion of the critical policy question: must developing countries "grow first and clean up later"? The paper explores the potential for "leapfrogging" to cleaner energy systems, arguing that international cooperation and technology transfer are essential to help developing countries pursue a less carbon-intensive path to prosperity.