Air Pollution, Economic Growth, and the European Union Enlargement

Abstract

This study examines the Environmental Kuznets Curve (EKC) hypothesis between the levels of air pollution and per capita income growth, considering the largest enlargement of the European Union (EU). Four different measures of environmental quality, SPM, NO X , SO 2 , and CO 2 , are employed for three different country groups: the core fifteen countries of the EU before its largest enlargement, the twenty five EU countries after the enlargement, and the new ten countries that became the members of the EU after this enlargement process. The results present a statistically significant U-shaped EKC relationship between each of the air pollutants and per capita income growth for the core fifteen EU member countries and the twenty-five countries after the enlargement. These findings imply that beyond a certain level of GDP, a further rise in income can only be reached at the cost of environmental degradation. For the third country group of the study, the countries that joined the EU after its largest enlargement, there is no statistically significant evidence for the existence of an EKC in any type.