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Preferences, Technology, and the Environment: Understanding the Environmental Kuznets Curve Hypothesis
Author(s) -
Plassmann Florenz,
Khaneha
Publication year - 2006
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.1111/j.1467-8276.2006.00884.x
Subject(s) - kuznets curve , economics , consumption (sociology) , environmental pollution , econometrics , pollution , expression (computer science) , production (economics) , simple (philosophy) , path (computing) , microeconomics , computer science , ecology , environmental science , biology , environmental protection , programming language , social science , philosophy , epistemology , sociology
We derive a simple expression for the income‐pollution path using the standard static model of the environmental Kuznets curve (EKC). This expression makes it straightforward to identify the general characteristics of utility and pollution functions that lead to such a curve. We show that suitable preferences can always lead to an EKC while there is no technology that yields an EKC for all types of preferences, and we derive a sufficient condition for technology that leads to an EKC for almost all types of preferences. Our results hold for a model with multiple goods with different pollution intensities and for a production economy with nonconstant relative price of consumption and environmental effort. We derive our results without assuming specific functional forms and we encompass several other models as special cases.