The Environmental Kuznets Curve Under a New framework: Role of Social Capital in Water Pollution

The Environmental Kuznets Curve Under a New framework:

Role of Social Capital in Water pollution

The Environmental Kuznets Curve (EKC) suggests an inverted-U shaped relationship
between economic growth and pollution. The shape of this curve implies that pollution
initially rises with economic growth and then falls as country or region reaches an
advanced stage of industrialization. In the early stage especially before the turning point,
people focus attention on economic development, jobs, and income, while tolerating
increased pollution levels. After the country reaches a certain level of welfare and
economic growth (commonly referred to as a threshold point), people pay more attention
to the pollution, and initiate programs to clean up air and water resources.

Empirical evidence on EKC is mixed. A few studies have supported inverted-U
shape curve for the EKC (Paudel et al.; McConnell; Selden and Song; John and
Pecchenino). On the other hand Grossman and Krueger found water quality declined
monotonically with income. Stern’s review of the empirical EKC literature with respect
to air and water quality concluded the inverted-U curve relationship applies only to
certain types of pollution. This inconsistency in the shape of the EKC has been a
motivation to continue studying the income pollution relationship.

Most research in the EKC involves regression models with air and/or water
quality measures as a dependent variable and per capita income, population density, and
other economic and demographic variables as the independent variables. Per capita
income alone may not be the optimum determinant of pollution levels in the EKC

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