Tuesday, July 26, 2016

Will Carbon Emissions Fall As Per Capita GDP Rises?

The Kuznets curve was used to argue that income inequality would decline after absolute income reaches an inflection point.  It has been discredited by the recent trends in the growth of income inequality.  It has been revived today to argue that carbon emissions will fall as a nation reaches an inflection point in per capita GDP.  This article provides a critique of the use of an environmental Kuznets curve which tells us that carbon emissions will fall as a nation gets richer.  Economists love to plot curves to explain complicated relationships between variables.  Unfortunately, there is no reason to believe that carbon emissions will fall after we reach an inflection point in per capita income.  There is nothing that would allow us to determine the inflection point. And there is little reason to believe that an inflection point exists.

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