An Empirical Research On The Relationship Between Economic Growth And Environmental Quality

Since the reform of opening up, China’s economic development has experienced rapid growth. Statistical results show that the annual rate of growth is close to10%, the annual rate of per capita GDP growth is close to9%. With the rapid growth of economic development, environmental pollution has become increasingly serious and environment quality has become more deteriorate. Paying more attention to the environmental quality, the relationship between economic growth and environmental quality has becoming a hot issue in all fields.In the early stage of industrialization, environment and resources was set to the field of public, producing free rent value. The way of growth is extensive, in inefficient and excessive use of environment. The self-purification of environment and our ability to deal with pollution can’t handle the pollution emissions that environment system produced. Environmental need growth is faster than environment supply growth. Environmental losses, which surpass the value that economic growth creates, are above zero. Thus environmental problems appear. But this way of growth provided original funds to the industrialization. Beyond this way, it is hard to talk about to transform the mode of economic development, which means using human capital instead of natural resources to support economic growth. When economic development grows to a certain stage, per capita income increase gradually, the marginal utility of clean environment improves. With our consciousness of environmental protection strengthening and environmental protection investment increasing, we increase strengthen to deal with environment pollution sources, reducing pollution emission. Making the balance of environmental supply and demand and putting the environmental problem improved and solved, we can coordinate the development of economy and environment and realize the way of sustainable development, the external performance of EKC.From the American economist Kuznets propose EKC theory in1950s, scholars from domestic and aboard test the EKC in the way of theoretical and empirical. The empirical research in the dissertation includes two parts, to show the curve feature of the relationship between economic growth and environmental quality separately from the level of state and province. In the analysis of China as the research object, using30provinces and autonomous regions’panel data from1998to2010year and using period individual fixed effect and tool variables method, to examine the relationship between economic growth and environmental quality in2SLS. The results show that the curve between waste water and solid waste emissions and economic growth is inverse U shape, but the same shape don’t exist in waste gas emissions, which means China’s economic growth don’t fully comply with EKC hypothesis. Waste water and solid waste emissions haven’t cross curve inflection point, there is pressure on the environment. In the other factors that affect the environment quality, population scale enlargement reduce environment quality, the growing rate of second industry to GDP will reduce waste gas and solid waste emissions but can increase waste gas emission in insignificant, related environmental policies will improve environmental quality. In the analysis of Jiangxi province as the research object, using economic growth and pollution data from1990to2010year, we first use principal component analysis to capture the comprehensive index which reflects environmental quality, then build the simultaneous equations that contains pollution and output, lastly analyze the relationship between economic growth and environmental quality. With the growing of per capita GDP, the curve between economic growth and environmental quality is inverse N shape, which is first down second up and last down. The rising proportion of second industry in the national economy will reduce pollution. To deal with the pollution in large area of pollution is more difficult than small area of pollution. Increasing scientific research fund will promote technological progress, improve efficiency of resource utilization and reduce pollution. The rate of pollution control investment to GDP is low, discontinuous, unstable and has gap with compare to the international level and other developed provinces, reduce pollution in insignificance. With large green coverage reduce pollution obviously. The enhancement of open trade will increase the pollution. In inputs, the accumulation of physical capital and human capital are important factors that increased output growth. Especially the impact of physical capital is more significant. Environment pollution has negative role in economic development.The government should optimize the industrial structure, transform the development mode and increase the technological transformation to promote the development of environmental protection industry. The third industry has characteristic of low pollution, low consumption, high yields and high employment. The government should develop the third industry to provide an opportunity for the implementation of green development. Improving and perfecting the legal system construction to build good foundation for improving the environment quality. The government should increase R&D funds, encourage enterprises to promote level of science and technology innovation. The government should improve the structure of the trade goods, limit the produces of high pollution and high resource export. We should enhance the consciousness of environmental protection and advocate the way of civilized, conservation of resources, green and low carbon consumption life.