IS GROWTH A DIRTY WORD - POLLUTION, ABATEMENT AND ENDOGENOUS GROWTH

Potential conflicts between economic growth and environmental degradat ion are central to the sustainable development debate. An endogenous g rowth model is used to investigate tradeoffs between economic growth a nd environmental quality, where growth is dependent on technology impr ovements, emissions are generated during final goods production, and p hysical resources can be used to abate pollution. Pollution growth is higher in a decentralized economy, but technology growth rates can not be ranked between the efficient and equilibrium paths. Even with rest ricted abatement activity, second-best pollution growth will be below the unregulated level. Zero economic growth policies may increase the rate of environmental degradation. (C) 1997 Elsevier Science B.V.