Environmental and Resource Economics

, Volume 63, Issue 2, pp 265–288 | Cite as

The Environmental Kuznets Curve and the Structural Change Hypothesis

  • Simone Marsiglio
  • Alberto Ansuategi
  • Maria Carmen Gallastegui


We provide a very simple macroeconomic investigation of the role that structural changes might play in generating inverted U-shaped income–pollution relationships. Differently from previous research which mainly focuses on empirical, static or general equilibrium models, we develop a standard balanced growth path (BGP) analysis. We show that along the BGP equilibrium an inverted U-shaped income–pollution relationship may occur as a response to structural changes, but whether this is the case or not it will crucially depend upon the magnitude of a production externality parameter. Moreover, we show that the negative relationship between income and pollution can only be a transitory phenomenon, and in the long run pollution will increase as income rises, generating overall an N-shaped pattern.


Environmental Kuznets curve Economic growth Structural change 

JEL Classification

O40 O41 Q50 Q56 


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Copyright information

© Springer Science+Business Media Dordrecht 2015

Authors and Affiliations

  • Simone Marsiglio
    • 1
  • Alberto Ansuategi
    • 2
  • Maria Carmen Gallastegui
    • 2
  1. 1.School of Accounting, Economics and FinanceUniversity of WollongongWollongongAustralia
  2. 2.Department of Foundations of Economic Analysis I, Institute of Public EconomicsUniversity of the Basque CountryBilbaoSpain

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