NATIONAL AND INTERNATIONAL TRADE AND THE ENVIRONMENT I The Environmental Kuznets Curve Hypothesis
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چکیده
If the EKC holds, we might be tempted to make an even stronger statement: growthpromoting policies in less developed countries (LDCs) cause incomes to rise and are thus environmentally friendly. We do not need to bother negotiating with developing countries to reduce emissions. Let LDCs develop, and they will eventually solve their own environmental problems, even if in the short run pollution rises. This idea has been embraced by the World Bank and IMF. Under this idea, trade agreements are also environmentally friendly even if the LDC has lax pollution regulations. However, the EKC is controversial. It is not clear either in theory or the data that pollution eventually decreases with income, or what the TURNING POINT (the level of income after which pollution falls) is.
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