Environmental Kuznet Curve

Name: Dai Wei ID Number: 088916

Environmental Kuznet Curve Environment Kuznet Curve is the application of Kuznet Curve which describes the relationship between the degree of income inequality and the stage of development. However, EKC depicts the variation of environmental degradation with the increasing incomes. The illustration in relation to the relationship resembles a reverse “U” shape as shown in figure 1.1. That means the harm to environment brought from economic development of society is inevitable. As the I = PAT model indicates, more income means more production of goods and hence more use of resources and energy and more waste disposal. That is why environment is getting worse as average income is increasing. But EKC theory emphasizes that environmental degradation will reach a peak, which opposes common sense. Next, there is a turning point which leads environmental Kuznet curve to drop steeply. In this theory, economic growth cleans up the original damage to environment. That is, economy body then will head to environment-friendly direction.
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We can realize that developed countries have cleaner street, air, water while developing or the third countries have worse environment. Economic growth firstly stimulates environmental degradation, and then restrains it. The reason could be discussed in four aspects. 1) Advance economies exporting their pollution to less developed countries In our impression, less developed countries are poor, dirty, and have terrible environment. In fact, they are uneasy to be influenced by economic factor. Many of them collect the waste matter for import as trade. America is one paradigm to trade waste matter. In January, The amount of waster matter export is almost 1.32 million ton in America. This avoids wealthy countries’ environment going worse while the environment of less developed countries keeps deteriorating. 2) Higher life standard leading to more extra payment for environmental quality. As life standard rises, the basic needs of people have been satisfied. People are more willing to pay for environmental quality. Large sacrifices in consumption ultimately contribute to the environment benefits. Planting trees on large scale, recycling for waste matter, sanitization of pollutants are all appliances for environmental benefits. This environment-friendly management is more remarkable in metropolis. Protected environment is also good for human health and ecosystem. In a word, social development and environment assist each other. After analyzing the figure of environmental indicators at different country income levels, population without safe water and adequate sanitation mainly locate in less developed countries or low-income countries. Moreover, the content of particulate matter or sulfur dioxide increases first, then fall sharply with the rise of GDP. But Problems such as carbon dioxide emission still undermine the environment. 3) Advanced civilization raises more awareness of environment protection with more environmental regulations. In advanced civilization, citizens are highly educated with good quality. In these wealthy countries, environmental protection is carried out from individual. There is no better way to educate everybody to protect environment every day. Higher income and education empower local communities to enforce higher environmental standards. Relative legislations will restrain citizens’ behavior. Both morality and regulation buffer environmental degradation. Nowadays, environment issue has been raised to the height of international realization. International Environment Day is one reflection of increasing awareness. International Environment Day is the media to stimulate the global environment realization and to give rise to attention of national governments. 4) The conversion of productive force When one nation’s productive force converts from agriculture to industry, environment degradation will reinforce. With the acceleration of industry, more and more natural resources will be exploited. The speed of consumption exceeds the speed of regeneration. Pollution will be more serious. However, further upgrade of productive force brings service industry and technology-centralized industry. The former technology which is seriously harmful to environment has been replaced by clean technology. Production materials, production process, and production outcome have been more environment-friendly. From the root, the environment is less influenced by human forces.

In EKC theory, the model “develop first, harness later” seems to be reasonable. But this theory is just an objective phenomenon, not an inevitable law. Some scholars also find that the observation is just the opposite. After observations to 117 countries, Meyer et al. (2003) concluded that the relationship between the degree of forest destruction and average income resembles “U” shape. Of course, EKC is just an ideal model. Specific object may have different conditions which may involve factors such as politics system, spoiled government. In all, reverse “U” shape of environment Kuznet curve can be explained by the four aspects shown above.

References: 1. Lecture 03 synopsis and reading list. 2. World Bank, 1992, World Development Report 1992, page 10. 3. The Environmental Kuznet Curve (EKC). http://www.owlnet.rice.edu/~econ480/notes/20.doc. Accessed 8/1/2007. 4. Kuznets curve. http://en.wikipedia.org/wiki/Kuznets_curve. Accessed 31/10/2008.

References: 1. Lecture 03 synopsis and reading list. 2. World Bank, 1992, World Development Report 1992, page 10. 3. The Environmental Kuznet Curve (EKC). http://www.owlnet.rice.edu/~econ480/notes/20.doc. Accessed 8/1/2007. 4. Kuznets curve. http://en.wikipedia.org/wiki/Kuznets_curve. Accessed 31/10/2008.