Economic Development and Pollutants : Brazil’s Economic Development

University essay from Högskolan i Jönköping/IHH, Nationalekonomi

Abstract:

The purpose of this paper is to investigate the correlation of economic development and pollutants in Brazil from 1960 to 2008. This investigation is conducted by scrutinizing and testing the much contested Environmental Kuznet Curve (EKC); an economic theory relating income to environmental degradation by an inverted U-shape. Empirical tests of Carbon dioxide (CO2) per capita and income (GDP per capita) provided us with the conclusion that there is a strongly positive correlation between these variables. The observed relationship tells us that as income increases, CO2 emissions increase as well, although at a slightly decreasing scale. Thus, the expected inverted U-shape is not observed in Brazil, findings that are in line with previous research. Further, the empirical tests tell us that Brazil is approaching a potential turning point of an EKC. The results indicate that although Brazil may have succeeded in some aspects of approaching a Sustainable Development, there are still issues for improvement. 

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