The Environmental Kuznets Curve (EKC)- Developing countries and SD

This is a post to follow up on my initial post regarding when developing countries should actually start the efforts for SD by looking at the theory of the “Environmental Kuznets curve”.

“Kuznets curve KC is the graphical representation of ‘Kuznets hypothesis’ that economic inequality increases over time while a country is developing, then after a critical average income is attained, begins to decrease. This is due to gaps in compensation, education and opportunities “ This curve is also known as the inverted U curve.

The environment is another place where the KC is used is the environment, now it is called EKC. The idea here is similar, some environmental elements will follow the same curve as the development of the country is going on. The issue here in the theory that it does not apply to all aspects of the environment ( when I am talking about the environment I am referring to the air, water, pollution and so on ).

The EKC seems to work well with the air pollutants, as we develop we ignore the issue of pollutants till we have enough money then we deal with it and the interest will increase again ( see figure ). Now this is not true for the land, water and energy ! They fail to follow the curve. ( see figure ). Studies of the KC and EKC curves estimated the need of the country to reach a GDP of $8000 per capita before the transition happens!! This is a little unrealizable as even the US with all the wealth and development is not there yet!

Now, to relate this to developing countries, I totally agree with the overall theory and it actually supports my view and the view of some comments. The idea is you will not care about the environment or in this case SD of your resources till you have a shelter from the rain and a full stomach. Referring to the Maslow’s hierarchy of needs, you cannot jump levels especially at the bottom of the pyramid! The EKC can fit the SD effort levels perfectly ( see figure)

EKC Curves

“A recent theory that some researchers have been examining with the environmental Kuznets curve is that the traditional “inverse U” shape is actually an “N” shape when longer term time scales are evaluated. This “N” shape would indicate that pollution increases as a country develops, decreases once the threshold GDP is reached, and then begins increasing as national income continues to increase.”

This is a more accurate model to the reality on the ground. You develop and reach the tipping point, in the process you ignore SD, then you will attempt to fix SD but you will continue to grow and consume more!

The N EKC Curve

I did the figures to try and explain what I see the model is representing.


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Posted in ecological degradation, economic development
6 comments on “The Environmental Kuznets Curve (EKC)- Developing countries and SD
  1. RGiggey says:

    Saad, hate to do this after all of your hard work, but you mentioned the threshold of $8000 per capita GDP, and that the US isn’t there yet. Am I mistaken or is the US GDP per captia more like $45,000 (and somehow Cyprus is ahead of them – must be the olives)?

    excuse the wikipedia reference: http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita

    However, the stats I provided earlier still ring true in the number of countries that would not hit this mark, and according to this table only 90 countries in the world make it.

  2. saadabdalla says:

    Rob,

    the reference i make in the post is that the US is there at the threshold but are no where near following the trend the curve is predicting . in other words , they are more like the N curve where they are growing the pollution again and using more and more energy ….

    to add to this , speaking to Jeremy he mentioned the M curve which another extension to the N curve and is when developed nations such as the US would again reach another level of GDP ( allowing it as a measure here ) and a level of non-sustainability again to prompt them to react and reduce the bad stuff again.

    thanks for pointing out the mis-wording there and i hope this is more clear to read….

    Saad

  3. RGiggey says:

    Thanks Saad, you were very clear.

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