Investigating the environmental Kuznets curve of consumption for developing and developed countries: a study of Albania and Sweden

Abstract

Summary

The aim of this research was to investigate the long-run relationship between economic growth and environmental quality in Sweden and Albania using the environmental Kuznets curve (EKC) hypothesis. This was done through empirical research using secondary data for Gross domestic product (GDP) per capita, ecological footprint (EF) and trade openness (EX) which were run through both a regression and an Autoregressive Distributed Lag (ARDL)analysis.

Objectives

I) To investigate the individual EKCs for Sweden and Albania and their respective turning points.

II) To discover a potential delinking of economic growth and environmental quality in Sweden and Albania.

Conclusions

I) There was no evidence for an EKC for Sweden, and therefore no turning point was found using the dataset from 1984 to 2012. In other words, there was no decoupling between economic growth and environmental quality.

II) An EKC exists for Albania in terms of the relationship between income per capita and the EF. The turning point was around $1808.6, which meant that Albania has already decoupled their economic growth from environmental quality.