Study on the Environmental Kuznets Curve

The Environmental Kuznets Curve(EKC) hypothesis postulates an inverted-U-shaped relationship between environmental pressure and economic development(i.e.per capita income),which means that environmental quality deteriorates at the early stages of economic growth and subsequently improves at the later stages.In other words,environmental pressure increases faster than income at the early stages of development and slows down relative to economic growth at higher income levels.This has been taken to imply that economic growth will eventually redress the environmental impacts of the early stages of economic development and that growth will lead to further environmental improvements in the developed countries.A sizeable literature on EKC has grown in the recent period,especially empirical.Empirical studies of EKC have shown four different relationships between environmental pressure and economic growth: inverted-U-shaped relationship,monotone relationship,U-shaped relationship and N-shaped relationship.Possible explanations for EKC are seen in(i)the progress of technology,from clean agrarian economy to polluting industrial economy to clean service economy;(ii) tendency of people with higher income having higher preference for environmental quality;(iii)international trade reducing pollution in some developed countries;(ⅳ) the existence of an endogenous 'self-regulatory market mechanism' for those natural resources that are traded in markets might prevent environmental degradation from continuing to grow with income has been suggested;(ⅴ) environmental regulation enforced improving quality of environment from continuing to grow with income has been suggested.There is a new phenomenon—the relinking of environmental pressure and economic development,called the relinking hypothesis.It suggests the delinking of environmental pressure and economic development may not be persistent,already some advanced economies may be entering a new period of relinking.The relationship between environmental pressure and economic development in the medium long time may be N-shaped rather than inverted-U-shaped.Evidence of the existence of the EKC has been questioned from several corners.So there is more literature on the open question of EKC,and this paper takes account a few of problems such as model-problem,economic analytic approach problem,data and index problem,trade-problem and other problems.And there are five domains which needs to be further studied on the basis of these:(a) more precise models on relationship between environmental pressure and economic development needed to be founded,metric-method also needed for further study;(b) more appropriate approaches of economic analysis based consumption and production need to be searched;(c) more cross-sectional indexes on environment and development need for further research;(d) international trade that is a complex problem should be further studies.This paper provides an overview of the EKC background history and theoretic-base,empirical studies,and open questions.It is meaningful for EKC studies to clarify the relationship between environmental pressure and economic growth,and adopt sustainable environmental policies in theory and in practice.