Environmental Engineering Reference
In-Depth Information
12. Economic growth and the environment
Dalia El-Demellawy
Introduction
This chapter critically reviews empirical literature on the relationship
between economic growth and the environment. It starts with outlining
the debate around the relationship and then presents basic models used in
the empirical studies. Finally, the various empirical studies are discussed.
Study of the relationship between economic growth and the environ-
ment goes back to the 1960s. It started in developed countries when
considerable concern arose regarding the impact that economic develop-
ment was having on their environment. This growing concern led to the
1972 United Nations World Conference on the Human Environment in
Stockholm. This conference highlighted the conl ict of interest between
developed and developing countries regarding the relationship between
economic growth and the environment. The developing countries were
more concerned with development at the expense of the environment.
In other words, slowing economic development to protect the environ-
ment was not appreciated. Even in developed countries there was con-
l ict of interest among dif erent groups in society, with workers ranking
improvements of their standard of living associated with technological
advancements above environmental concerns (Beckerman, 1992). Despite
conl ict of interest, concerns about the natural environment and its link to
problems of economic development were explicitly stated. It was argued
that exhaustion of the environmental resource base, in terms of minerals
and food production, would provide limits for future economic growth.
However, it was not thought that economic collapse was inevitable. On
the contrary, it was concluded that the world economic system could be
sustainable into the future provided that radical changes in the way it was
being run were adopted (Meadows et al., 1972).
Awareness of the relationship between the environment and economic
growth gained prominence in 1987 for a number of reasons. First, the
widespread environmental and economic problems in the world; particu-
larly high levels of poverty and famines in various countries. Second, the
urgent and complex problem of the national and global scale of environ-
mental pollution; especially that associated with climate change due to
increasing emissions of greenhouse gases (GHGs) causing global warming.
This, in turn, was considered to lead to serious unfavourable ef ects on (1)
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