Editing Kuznets curve (section)

== Environmental Kuznets curve ==
[[File:Environmental_Kuznets_Curve.png|thumb|Hypothetical environmental Kuznets curve: a translation of the Kuznets curve to the use of natural resources.|alt=]]
The environmental Kuznets curve (EKC) is a hypothesized relationship between environmental quality and economic development:<ref>{{Cite journal|last1=Yasin|first1=Iftikhar|last2=Ahmad|first2=Nawaz|last3=Chaudhary|first3=Muhammad Aslam|date=2020-07-22|title=The impact of financial development, political institutions, and urbanization on environmental degradation: evidence from 59 less-developed economies|journal=Environment, Development and Sustainability|volume=23|issue=5|pages=6698–6721|language=en|doi=10.1007/s10668-020-00885-w|s2cid=220721520|issn=1573-2975}}</ref> various indicators of [[environmental degradation]] tend to get worse as modern economic growth occurs until average income reaches a certain point over the course of development.<ref>Shafik, Nemat. 1994. Economic development and environmental quality: an econometric analysis. ''Oxford Economic Papers'' 46 (October): 757–773</ref><ref name="Grossman2001">{{cite journal |last1=Grossman|first1=G. M. |first2=A. B. |last2=Krueger   |title= Environmental impacts of a North American Free Trade Agreement |journal= National Bureau of Economic Research Working Paper 3914, NBER |year=1991 |doi=10.3386/w3914|author2-link=Alan B. Krueger |doi-access=free|author1-link=Gene Grossman }}</ref> The EKC suggests, in sum, that "the solution to pollution is economic growth."

Although subject to continuing debate, there is considerable evidence to support the application of the environmental Kuznets curve for various environmental health indicators, such as [[Water pollution|water]], air pollution and [[ecological footprint]] which show the inverted U-shaped curve as per capita income and/or GDP rise.<ref>{{Cite journal|last1=Yasin|first1=Iftikhar|last2=Ahmad|first2=Nawaz|last3=Chaudhary|first3=M. Aslam|date=2019-07-22|title=Catechizing the Environmental-Impression of Urbanization, Financial Development, and Political Institutions: A Circumstance of Ecological Footprints in 110 Developed and Less-Developed Countries|journal=Social Indicators Research|volume=147|issue=2|pages=621–649|language=en|doi=10.1007/s11205-019-02163-3|s2cid=199855869|issn=0303-8300}}</ref><ref name=RIG>{{cite news |url=http://tierneylab.blogs.nytimes.com/2009/04/20/the-richer-is-greener-curve/ |title=The Richer-Is-Greener Curve |author=John Tierney |work=The New York Times|date=20 April 2009|author-link=John Tierney (journalist) }}</ref> It has been argued that this trend occurs in the level of many of the environmental pollutants, such as [[sulfur dioxide]], [[nitrogen oxide]], [[lead]], [[DDT]], [[chlorofluorocarbons]], [[sewage]], and other chemicals previously released directly into the air or water. For example, between 1970 and 2006, the United States' inflation-adjusted GDP grew by 195%, the number of cars and trucks in the country more than doubled, and the total number of miles driven increased by 178%. However, during that same period certain regulatory changes and technological innovations led to decreases in annual emissions of carbon monoxide from 197 million tons to 89 million, nitrogen oxides emissions from 27 million tons to 19 million, sulfur dioxide emissions from 31 million tons to 15 million, particulate emissions by 80%, and lead emissions by more than 98%.<ref>{{cite news|url=http://www.opinionjournal.com/columnists/pdupont/?id=110008416 |title=Don't Be Very Worried |publisher=The Wall St. Journal |date=23 May 2006 |url-status=bot: unknown |archive-url=https://web.archive.org/web/20060615222424/http://www.opinionjournal.com/columnists/pdupont/?id=110008416 |archivedate=15 June 2006 }}</ref>

[[Deforestation]] may follow a Kuznets curve (cf. [[forest transition]] curve). Among countries with a per capita GDP of at least $4,600, net deforestation has ceased.<ref>[http://www.pnas.org/content/103/46/17574.short Returning forests analyzed with the forest identity], 2006, by Pekka E. Kauppi (Department of Biological and Environmental Sciences, University of Helsinki), Jesse H. Ausubel (Program for the Human Environment, The Rockefeller University), Jingyun Fang (Department of Ecology, Peking University), Alexander S. Mather (Department of Geography and Environment, University of Aberdeen), Roger A. Sedjo (Resources for the Future), and Paul E. Waggoner (Connecticut Agricultural Experiment Station)</ref> Yet it has been argued that wealthier countries are able to maintain forests along with high consumption by 'exporting' deforestation, leading to continuing deforestation on a worldwide scale.<ref name="Outsourcing Deforestation">{{cite web|title=Developing countries often outsource deforestation, study finds|url=http://news.stanford.edu/news/2010/november/woods-outsource-deforestation-112410.html|website=Stanford News|accessdate=18 June 2015|date=24 November 2010}}</ref>

===Criticisms===
However, the EKC model is debatable when applied to other pollutants, some natural resource use, and biodiversity conservation.<ref>{{cite journal |vauthors=Mills JH, Waite TA |year=2009 |title=Economic prosperity, biodiversity conservation, and the environmental Kuznets curve |journal=Ecological Economics |volume=68 |issue=7 |pages=2087–2095 |doi=10.1016/j.ecolecon.2009.01.017}}</ref> For example, energy, land and resource use (sometimes called the "[[ecological footprint]]") may not fall with rising income.<ref name="US Energy Consumption 1960-2009">{{cite web|title=Google Public Data US Energy|url=https://www.google.com/publicdata/explore?ds=djha77o4u941j_&ctype=l&strail=false&bcs=d&nselm=h&met_y=consumption&scale_y=lin&ind_y=false&rdim=state&ifdim=state&tdim=true&tstart=-285267600000&tend=1261033200000|publisher=Energy Information Administration|accessdate=17 December 2011}}</ref> While the ratio of energy ''per [[real GDP]]'' has fallen, ''total'' energy use is still rising in most developed countries as are ''total'' emission of many [[greenhouse gases]]. Additionally, the status of many key "[[ecosystem services]]" provided by ecosystems, such as freshwater provision (Perman, ''et al''., 2003), soil fertility,{{Citation needed|date=November 2007}} and fisheries,{{Citation needed|date=November 2007}} have continued to decline in developed countries. Proponents of the EKC argue that this varied relationship does not necessarily invalidate the hypothesis, but instead that the applicability of the Kuznets curves to various environmental indicators may differ when considering different ecosystems, economics, regulatory schemes, and technologies.

At least one critic argues that the US is still struggling to attain the income level necessary to prioritize certain environmental pollutants such as carbon emissions, which have yet to follow the EKC.<ref name="Yandle2002">{{cite web |vauthors=Yandle B, Vijayaraghavan M, Bhattarai M |url=http://www.perc.org/articles/article688.php |title=The Environmental Kuznets Curve: A Primer |year=2002 |publisher=The Property and Environment Research Center |accessdate=16 June 2008 |archive-url=https://web.archive.org/web/20081230031711/http://www.perc.org/articles/article688.php |archive-date=30 December 2008 |url-status=dead }}</ref> Yandle ''et al.'' argue that the EKC has not been found to apply to carbon because most pollutants create localized problems like lead and sulfur, so there are a greater urgency and response to cleaning up such pollutants. As a country develops, the marginal value of cleaning up such pollutants makes a large direct improvement to the quality of citizens' lives. Conversely, reducing carbon dioxide emissions does not have a dramatic impact at a local level, so the impetus to clean them up is only for the altruistic reason of improving the global environment. This becomes a [[tragedy of the commons]] where it is most efficient for everyone to pollute and for no one to clean up, and everyone is worse as a result (Hardin, 1968). Thus, even in a country like the US with a high level of income, carbon emissions are not decreasing in accordance with the EKC.<ref name="Yandle2002"/> However, there seems to be little consensus about whether EKC is formed with regard to CO<sub>2</sub> emissions, as CO<sub>2</sub> is a global pollutant that has yet to prove its validity within Kuznet's Curve.<ref name=":0">{{Cite book|title=Environmental Kuznets Curve Hypothesis and Carbon Dioxide Emissions - Springer|last=Uchiyama|first=Katsuhisa|doi=10.1007/978-4-431-55921-4|series = SpringerBriefs in Economics|year = 2016|isbn = 978-4-431-55919-1}}</ref> That said, Yandle ''et al.'' also concluded that "policies that stimulate growth ([[trade liberalization]], [[economic restructuring]], and [[price reform]]) should be good for the environment".<ref name="Yandle2002"/>

Other critics point out that researchers also disagree about the shape of the curve when longer-term time scales are evaluated. For example, Millimet and Stengos regard the traditional "inverse U" shape as actually being an "N" shape, indicating that pollution increases as a country develops, decreases once the threshold GDP is reached, and then begins increasing as national income continues to increase.  While such findings are still being debated, they could prove to be important because they pose the concerning question of whether pollution actually begins to decline for good when an economic threshold is reached or whether the decrease is only in local pollutants and pollution is simply exported to poorer developing countries.  Levinson concludes that the environmental Kuznets curve is insufficient to support a pollution policy regardless of whether it is [[laissez-faire]] or [[Interventionism (politics)|interventionist]], although the literature has been used this way by the press.<ref name="Levinson2000">{{cite book |author=Arik Levinson |citeseerx = 10.1.1.92.2062 |title=The Ups and Downs of the Environmental Kuznets Curve |year=2000 |publisher=[[Georgetown University]]}}</ref>

Arrow ''et al.'' argue pollution-income progression of agrarian communities (clean) to industrial economies (pollution intensive) to service economies (cleaner) would appear to be false if pollution increases again at the end due to higher levels of income and consumption of the population at large.<ref>{{cite journal  |vauthors=Arrow K, Bolin B, Costanza R, Dasgupta P, Folke C, Holling CS, et al |year=1995 |title=Economic growth, carrying capacity, and the environment |journal=Ecological Economics |volume=15 |issue=2 |pages=91–95 |doi=10.1016/0921-8009(95)00059-3|pmid=17756719 |doi-access=free }}</ref> A difficulty with this model is that it lacks predictive power because it is highly uncertain how the next phase of economic development will be characterized. {{Citation needed|date=September 2009}}

Suri and Chapman argue that the EKC is not applicable on a global scale, as a net pollution reduction may not actually occur globally. Wealthy nations have a trend of exporting the activities that create the most pollution, like manufacturing of clothing and furniture, to poorer nations that are still in the process of industrial development (Suri and Chapman, 1998). This could mean that as the world's poor nations develop, they will have nowhere to export their pollution. Thus, this progression of environmental clean-up occurring in conjunction with economic growth cannot be replicated indefinitely because there may be nowhere to export waste and pollution-intensive processes. However, [[Gene Grossman]] and [[Alan B. Krueger]], the authors who initially made the correlation between economic growth, environmental clean-up, and the Kuznets curve, conclude that there is "no evidence that environmental quality deteriorates steadily with economic growth."<ref name="Levinson2000"/>

Stern warns "it is very easy to do bad [[econometrics]]", and says "the history of the EKC exemplifies what can go wrong". He finds that "little or no attention has been paid to the statistical properties of the data used such as serial dependence or stochastic trends in time series and few tests of model adequacy have been carried out or presented. However, one of the main purposes of doing econometrics is to test which [[Correlation does not imply causation|apparent relationships]] ... are valid and which are spurious [[correlation]]s". He states his unequivocal finding: "When we do take such statistics into account and use appropriate techniques we find that the EKC does not exist (Perman and Stern 2003). Instead, we get a more realistic view of the effect of economic growth and technological changes on environmental quality. It seems that most indicators of environmental degradation are monotonically rising in income though the '[[income elasticity]]' is less than one and is not a simple function of income alone. Time-related effects reduce environmental impacts in countries at all levels of income. However, in rapidly growing middle income countries the scale effect, which increases pollution and other degradation, overwhelms the time effect. For example, Armenia, after gaining its independence from the Soviet Union, has become the country with the least income elasticity in Eastern Europe and Central Asia.<ref>Koilo, Viktoriia. 2019. "Evidence of the Environmental Kuznets Curve: Unleashing the Opportunity of Industry 4.0 in Emerging Economies" Journal of Risk and Financial Management 12, no. 3: 122. https://doi.org/10.3390/jrfm12030122</ref> In wealthy countries, growth is slower, and pollution reduction efforts can overcome the scale effect. This is the origin of the apparent EKC effect".<ref name = "Stern 2003">{{cite web |author=David I. Stern |title=The Environmental Kuznets Curve |publisher=International Society for Ecological Economics Internet Encyclopedia of Ecological Economics |url=http://www.ecoeco.org/pdf/stern.pdf |accessdate=17 March 2019 |archiveurl=https://web.archive.org/web/20110720034449/http://www.ecoeco.org/pdf/stern.pdf |archivedate=20 July 2011}}</ref>

=== Kuznets curves for steel and other metals ===
Steel production has been shown to follow a Kuznets-type curve in the national development cycles of a range of economies, including the United States, Japan, the Republic of Korea and China. This discovery, and the first usage of the term "Kuznets Curve for Steel" and "Metal intensity Kuznets Curve" were by Huw McKay in a 2008 working paper (McKay 2008). This was subsequently developed by McKay (2012). A body of work on "Material Kuznets Curves" focused on non-ferrous metals has also emerged as academic and policy interest in resource intensity increased during the first two decades of the 21st century.{{citation needed|date=March 2023}}