Simona Zlatkova

Prof. Georgi Kalchev

ECO 211 Environmental Economics

19 September 2017

The environmental Kuznets curve suggests a positive correlation between the economic

development and the deterioration of the environment. However, according to the prominent

economist Simon Kuznets, after a certain point the above-mentioned relationship becomes

negative as people become more and more concerned about the environmental quality. As a

result, the level of environmental degradation stats to decline. Let us try to verify if the

hypothesis works in reality.

Nowadays when most people hear about rapid economic growth, they instantaneously

use China as an example. However, the Asian tiger is also notoriously famous for its high rates

of environmental pollution. For the residents in big cities like Beijing or Peking, whose

population outnumbers the population of the countries on Balkan Peninsula, air quality red

alerts have become mundane experience. Nevertheless, the Chinese government is ready to

win the war against the pollution.

In the first quarter of the year, the Beijing government announced that it would increase

its energy efficiency and environmental protection budget with 23 percent. Moreover, it

underscored that more than 50 percent of the overall amount (33.8bn yuan) would be allocated

to the improvement of the air quality (Branigan, Chinese premier declares ). As a

contribution to the financial stimulus in the fight against pollution, the authorities decided to

daily check the companies whose production process incessantly contributes to the

environmental degradation. However, the war against pollution takes a place on a national

level. For example, after more than fifteen years after the last amendment, the Chinese
authorities updated its environmental jurisdiction giving them the right to detain companies

bosses who dont fulfil environmental impact assessments (Beijing makes first ).

The empirical data confirms the improvement of the air quality. For instance, in 2016

the average density of PM2.5 in Beijing was around 73 micrograms per cubic metre in Beijing,

marking an improvement of a 9.9 percent on 2015 PM2.5 figures. However, the environmental

problems cant be alleviated so easily in the central parts of the country where the local

authorities usually do not dare to impose rigid restrictions on the private sector because of the

existence of mutual interest.

Estimations show that air pollution costs China 6.5 percent of its GDP. According to

the World Health Organisation, using propane or natural gas instead of coal for residential and

commercial purposes, investing in the development of renewable fuels to generate electricity,

and scrapping older vehicles should be the next steps in the fight against pollution (Crane and

Mao).
 Works cited

Beijing makes first detainment over air pollution law breach. Accessed 19 Sept. 2017.

Branigan, Tania. Chinese premier declares war on pollution in economic overhaul.

The Guardian, Guardian News and Media, 5 Mar. 2014. Accessed 19 Sept. 2017.

Crane, Keith, and Zhimin Mao. Costs of Reducing Air Pollution. Costs of Selected

Policies to Address Air Pollution in China, Rand, Santa Monica, 2015.

Fullerton, Jamie. Beijing hit by dirty smog but observers say air is getting better. The

Guardian, Guardian News and Media, 31 Mar. 2017. 19 Sept. 2017.