Does S. Kuznets's belief question the Environmental Kuznets Curves?

Abstract

This paper examines the link between pollution and income. The main purpose is to assess whether the introduction of income inequality in a Environmental Kuznets Curve (EKC) analysis can give new insights into the relationship between pollution and economic growth. The EKC hypothesis proposes that there is an inverted U-shape relation between environmental degradation and income per capita. We question this common result, in a simple model where the income inequality evolution is exogenous and where the planner could use only one instrument. For a set of parameter values we find, for example, a two-hump curve. JEL classification: D3, H4, Q2.Est-ce que le postulat de S. Kuznets remet en question les courbes environnementales a`la Kuznets? Cet article analyse la relation entre pollution et revenu. L'objectif de cet article est de montrer comment la prise en compte de l'ine´galite´des revenus, dans une analyse de la courbe environnementale de Kuznets, peut modifier la relation entre pollution et croissance. L'hypothe`se de la courbe environnementale de Kuznets revient a`supposer l'existence d'une forme en U inverse´entre la de´gradation de l'environnement et le revenu par teˆte. Cet article remet en cause ce re´sultat a`l'aide d'un mode`le simple dans lequel l'ine´galite´du revenu e´volue de manie`re exoge`ne et ou`le planificateur ne peut utiliser qu'un seul instrument. Pour certaines valeurs des parame`tres du mode`le nous trouvons que la relation entre la pollution et le revenu suit une courbe a`deux bosses.

Preferences, Technology, and the Environment: Understanding the Environmental Kuznets Curve Hypothesis

“…Andreoni and Levinson (2001) assume that the abatement function that transforms environmental effort into abatement is homogeneous and Jones and Manuelli (2001) assume a specific functional form of the production function. Bousquet and Favard (2005) assume specific functional forms for U and P. With the exception of our Corollary 2, which extends Andreoni and Levinson's (2001) model, none of our results requires assumptions about functional forms beyond those already stated (although we occasionally restrict P C < ∞).…”

“…It is straightforward to verify that expression (7b) also yields Andreoni and Levinson's (2001) result that an EKC relationship requires a + b > 1. 6 6 Bousquet and Favard's (2005) model provides another application of Lemma 1. They use the utility function U = C ␣ − P and the pollution function P = aCM − b(EM) ␤ .…”

“…Lemma 1 therefore implies that a necessary condition for an EKC is ␣ = 1. Bousquet and Favard (2005) analyze the income-pollution path as a function of changes in the index of inequality, while our expression (7) makes it straightforward to express the incomepollution path as a function of environmental effort as well, which provides additional insides into the mechanics of their model. It is interesting to compare the driving forces behind the EKCs in the models by Stokey (1998) and by Andreoni and Levinson (2001).…”

Environmental Kuznets Curves for Carbon Emissions: A Critical Survey

“…So, the shape of the EKC is a consequence of high-income countries "exporting" their pollution to low-income countries. Other studies have included measures of income inequality (Torras and Boyce, 1998, Magnani, 2000, Bousquet and Favard, 2005 and measures of corruption (Lopez and Mitra, 2000, Fredriksson et al, 2004, Cole, 2007. The reason for the inclusion of income inequality is that inequality may reduce a country's willingness to pay for environmental regulation and abatement, while corruption presumably reduces the stringency of environmental policy and, therefore, is likely to have a negative impact on the environment as well.…”

Defining eco-innovations: characteristics, typologies and socioeconomic approaches

“…Moreover, when individuals enjoy greater incomes, they become more inclined to care for the quality of natural resources and to show an increased willingness to invest in the environment in which they live. This pushes companies to be more eco-innovative (Bousquet and Favard, 2000). Not all agree with this analysis.…”