Dynamic technique and scale effects of economic growth on the environment

A recent literature shows that the effect of economic growth on the environment is driven by technique and scale effects. Surprisingly, there are no dynamic estimates of these components in the literature. Using data from Canada, this paper makes a novel contribution by investigating asymmetric trends in economic growth effects and by breaking the aggregate effect into time varying scale and technique components. Our results show that scale and technique effects have significant dynamic components, and, thus, accounting for such dynamics is critical for assessing whether or not economic growth is good for the environment.