The J-Curve for the relationship between Pollution Abatement Expenditure and Income per capita: A New Empirical Investigation from US Regional Data

Monica Das and Debasri Mukherjee ()

Applied Econometrics and International Development, 2011, vol. 11, issue 2

Abstract: The main objective of our paper is to investigate the validity of the theoretically postulated J type relationship between pollution control expenditures/capita and income/capita. We use the Pollution Abatement Costs and Expenditures dataset to examine the validity of this postulated relationship for the US states during the years 1986 – 1994. Using a flexible nonparametric framework, we do not find any evidence to support the J type relationship between abatement/capita and income/capita for the U.S. economy. We attribute this result to the presence of increasing returns to pollution abatement or increasing marginal efficacy of pollution abatement.

Keywords: J-curve; pollution abatement; nonparametric kernel regression; panel data. (search for similar items in EconPapers)
JEL-codes: C14 C23 Q01 (search for similar items in EconPapers)
Date: 2011
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