NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Economic Growth and the Environment

Gene M. Grossman, Alan B. Krueger

NBER Working Paper No. 4634
Issued in February 1994
NBER Program(s):   ITI   PE

Using data assembled by the Global Environmental Monitoring System we examine the reduced-form relationship between various environmental indicators and the level of a country's per capita income. Our study covers four types of indicators: concentrations of urban air pollution; measures of the state of the oxygen regime in river basins; concentrations of fecal contaminants in river basins; and concentrations of heavy metals in river basins. We find no evidence that environmental quality deteriorates steadily with economic growth. Rather, for most indicators, economic growth brings an initial phase of deterioration followed by a subsequent phase of improvement. The turning points for the different pollutants vary, but in most cases they come before a country reaches a per capita income of $8,000.

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Document Object Identifier (DOI): 10.3386/w4634

Published: Quarterly Journal of Economics, vol. 110, 1995, pp. 353-378 citation courtesy of

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