Pollution-income dynamics

- We examine a dynamic model of the pollution-income relationship.
- We integrate scale, composition and technique effects of growth on pollution.
- Both inter-temporal and temporal elasticities of substitution are considered.
- We derive general conditions for the environmental Kuznets curve.
- Conditions for eluding the limits to growth are stricter than previously argued.

This paper integrates the scale, composition, and technique effects of economic growth on pollution using a multi-output endogenous growth framework. Under certain empirically verifiable parameter conditions economic growth is not sustainable, even under an optimal pollution tax.