Question

4. According to the Environmental Kuznets Curves, what’s is the relationship between income and pollution?

Answer 1

As per the Environmental Kuznets Curve, pollution and income are related in the form that initially as income increases, pollution/ environmental degradation increases and after a threshold of per capita income, the pollution level falls indicating the hypothesis that economic growth eventually leads to reduction in pollution. Thus the relationship between pollution and per capita income is an inverted U-shaped curve with the peak reaching at the turning point where pollution reaches maximum and starts reducing as income increases. With higher income levels, more amount of income is left for discretionary use for individuals to be conscious about the environment. Thus empirical evidences suggest the validity of this hypothesis, especially in case of water and air pollution. Nevertheless, there are criticisms about this hypothesis with respect to other pollutants such as land and energy resources. Moreover, other determinants of pollution might also be attributable to a reduction in levels such as increased govermental regulation or technological development.