Environmental Kuznets curves—real progress or passing the buck ...

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184 D.S. Rothman / Ecological Economics 25 (1998) 177–194 Table 1 Quadratic fits to consumption data Commodity Fitted equation a Adjusted r 2 Turning point b Food, beverages, and 79.36 (1.7)+0.21 (10.8)×(GDP/capita)−7.98×10 −6 (6.1) tobacco (GDP/capita) 2 Clothing and footwear 58.41 (2.6)+0.04 (4.4)×(GDP/capita)−5.61×10 −7 (0.9) (GDP/ 0.8893 12 889 0.7890 35 263 0.8158 23 278 0.9197 Gross rent, fuel and power −44.62 (0.5)+0.20 (5.4)×(GDP/capita)−4.25×10 −6 (1.7) capita) 2 House furnishings and 0.16 (0.0)+0.04 (5.7)×(GDP/capita)+1.79×10 −7 (0.4) (GDP/ (GDP/capita) 2 operations capita) 2 Medical care and services −101.81 (1.6)+0.12 (4.6)×(GDP/capita)−1.30×10 −6 (0.7) 0.8270 47 171 Transport and communicacapita) (GDP/capita) 2 55.29 (1.9)+0.00 (0.1)×(GDP/capita)+4.93×10 −6 (6.1) (GDP/ 0.9236 tions 2 Recreation, entertainment, 20.03 (0.4)+0.10 (4.5)×(GDP/capita)+1.17×10 −7 (0.1) (GDP/ 0.8684 education, etc. capita) 2 Other −39.08 (0.6)+0.06 (2.2)×(GDP/capita)+2.05×10 −6 (1.1) 0.7652 0.4949 13 169 Grains and starches 80.99 (2.7)+0.07 (5.4)×(GDP/capita)−3.44×10 −6 (4.0) (GDP/ 9830 (GDP/capita) 2 Meat and animal products 3.42 (0.2I)+0.08 (9.2)×(GDP/capita)−3.03×10 −6 (5.1) (GDP/ 0.8591 capita) 2 Other foods, beverages and capita) 2 14.27 (0.5)+0.06 (5.7)×(GDP/capita)−1.91×10 −6 (2.5) (GDP/ 0.7700 16 357 tobacco capita) 2 a Equations fitted to data provided by phase V of the United Nations International Comparison Programme (United Nations, 1994). Values in italic and parentheses are absolute values of the t-statistics for the coefficients. b Turning points only calculated for equations with negative coefficients on GDP 2 . provide an initial indication whether these relationships show an inverted-U type of behavior that might support the EKC hypothesis. Table 1 summarizes these relationships. Although composition, in terms of shares, does change with income, this is due principally to differences in relative growth between categories and not actual declines in consumption of any single commodity. The only commodity that displays an inverted-U shape is food, beverages, and tobacco 8 . Breaking this down into three categories—grains and starches, meat and animal products and other foods—shows that this is principally due to a decline in the consumption of grains and starches, arguably the least environmentally destructive food items (Fig. 4 and Table 1). 8 The author defines an inverted-U shape as requiring a negative coefficient on squared GDP per capita with a t-statistic greater than 2 in absolute value and a turning point that falls within the range of the data. Adriaanse et al. (1997) have estimated the total material requirements, including hidden flows, for the economies of the United States, The Netherlands, Germany and Japan for the past two decades. Their data show that, although there has been a pattern of declining material intensity, in terms of material requirements per unit of GDP, per capita natural resource requirements have continued to rise. An important caveat in using these data, however, is that the materials required to meet export demands are not currently deducted, so the measure does not yet provide a completely balanced picture of the requirements needed to meet the consumption demands of a particular country. de Bruyn and Opschoor (1997) and Suri and Chapman (1998) are the only researchers to date who have noted the importance of taking a consumption-based approach to analyzing the EKC hypothesis. In each case, the researchers find very little evidence to support a
D.S. Rothman / Ecological Economics 25 (1998) 177–194 185 Fig. 4. Consumption of food commodities 1985 (United Nations, 1994). conclusion of decreasing environmental impact at higher levels of income. 4. The issue of trade International trade provides the means by which national patterns of production and consumption can become disassociated within a nation. This becomes a major issue of consideration in examining the relationship between economic growth and environmental impact. This was hinted at in the earlier quote from Ekins (1997) and is further emphasized by Pearce and Warford (1993), Diwan and Shafik (1992) in their analyses of the relationships between trade and the environment: ‘‘It is perfectly possible for a single nation to secure sustainable development—in the sense of not depleting its own stock of capital assets—at the cost of procuring unsustainable development in another country’’ (Pearce and Warford, 1993). ‘‘The availability of technologies that delink local and global pollution eliminated many of the automatic benefits for the global environment from addressing local concerns. The North can now achieve improvements in local environmental quality while continuing to impose negative externalities internationally’’ (Diwan and Shafik, 1992). Much has been written in recent years on the relationship between trade, trade liberalization, environmental quality, environmental policy and economic performance 9 . This has been spurred in large part by negotiations surrounding the GATT and NAFTA. In the context of this paper, the key issue is not the economic logic of trade, but simply to what extent are changes in resource use and/or environmental degradation with income level due to shifting pollution and resource intensive production across borders. The notion that pollution and resource intensive production will move from richer to poorer 9 For the interested reader, the author would recommend the recent collections of essays by Low (1992), Folke et al. (1994), OECD (1994).
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