Income and Environment: An Examination of Convergence

Dinda, Soumyananda (2002): Income and Environment: An Examination of Convergence.

Abstract

The effective policy prescription depends on the actual position of the economy. This paper search for evidence of the linkage between economic growth and environment. To be specific, the paper is intended to observe how economic growth is systematically linked to the position of the economy as well as environmental quality. This systematic link is a foundation for the convergence of an economy towards steady state and the paper concentrates on growth theory and convergence highlighting on relative factor intensities of the two production sectors in determining the transitional dynamics of the system. The model predicts that average growth rate of output is inversely related to the initial level of output and directly associated with initial base level of environment.

• Item Type: MPRA Paper
• Language: English
• Keywords: Convergence, Environment, Factor intensity, Growth Theory, Steady State, Transitional Dynamic
• Subjects: O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O41 - One, Two, and Multisector Growth Models; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O44 - Environment and Growth; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q2 - Renewable Resources and Conservation; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q52 - Pollution Control Adoption and Costs ; Distributional Effects ; Employment Effects

References

• Barro, Robert J., economic Growth in a Cross section of Countries, Quarterly Journal of Economics, vol.-106, 1991, 407 - 443.

• Barro, Robert J. and Sala -I- Martin, Xavier, Convergence, Journal of Political Economy, vol.-100, 1992, 223 - 251.

• Barro, Robert J. and Sala -I- Martin, Xavier, Economic Growth, McGraw-Hill, 1995.

• Bond, Eric W., Wang, Ping and Yip, Chong K., ageneral Two-sector Model of Endogenous Growth with Human and Physical Capital: Balanced Growth and Transitional Dynamics, Journal of Economic Theory, vol.-68, 1996, 149 - 173.

• Coondoo, D. and Dinda, S., Causality between Income and Emission: a country group-specific econometric analysis, Ecological Economics, Vol. 40, 351-367.

• Mankiw, N. Gregory, Romer, David, and Weil, David N., A Contribution to the Empirics of Economic Growth, Quarterly Journal of Economics, vol.-107, 1992, 407 - 437.

• Mulligan, Casey B., and Sala-I-Martin, Xavier, Transitional Dynamics in Two-Sector Models of Endogenous Growth, Quarterly Journal of Economics, vol.-108, 1993, 739 - 775.

• Rebelo, Sergio, Long Run Policy Analysis and Long Run Growth, Journal of Political Economy, vol.-99, 1991, 500 - 521.

• Solow, Robert M., A Contribution to the Theory of Economic Growth, Quarterly Journal of Economics, vol.-LXX, 1956, 65 - 94.

• Song, E. young, The Return to Capital and Convergence in a Two Sector Model of Endogenous Growth, International Economic Journal, vol.-14, 2000, 143 - 163.