Environmental Mortality and Long-run Growth

There is emerging evidence that environmental degradation increases human mortality. This paper provides a long-run consumer optimization model in which mortality is endogenous to emissions generated by production. Emissions are assumed to follow the EKC path, first rising and then falling along with ouput. In the optimum, some deaths are accepted as an exchange for consumption. The model is estimated for the European outdoor air pollution data, showing that Europe has reached the downward sloping sement of the EKC. Economic growth will thus decrease rather than increase air pollution and the associted deaths in most countries in Europe.

KEYWORDS: optimal growth, pollution, environmental mortality, Europe

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