Department of Economics

The empirical literature on the environmental Kuznets curve (EKC) purports to describe how a nation’s environmental quality will evolve if it makes the transition from poverty to wealth. The popular generalization is that pollution will first increase and then, if income becomes sufficiently high, decline. Empirical support for this proposition is based primarily on cross-country variations in income and pollution rather than evidence on the behavior of individual countries over time. We examine a recently available data set on SO2, smoke, and particulate air pollution to look for examples of countries following the EKC process. For most pollutants the income-pollution pattern does not differ from what would be expected to occur by chance. According to the EKC hypothesis, the driving force in the worldwide decline in air pollution is growth in income. To check the plausibility of this explanation, we estimate country-specific income elasticities for clean air that are implied by the EKC framework. We find them to be implausibly large relative to other estimates in the literature. We suggest an alternative hypothesis, that public support for environmental protection increased dramatically around 1970, sparking increased efforts to improve environmental quality. Cleanup was faster in rich countries than in poor, however. The record of within-country air pollution trends is broadly consistent with this story.