Environmental Kuznets Curve: empirical evidence for the peruvian economy. 1972 – 2010

Abstract

The objective of this research is to determine the existence of the relationship between economic growth and environmental degradation for the Peruvian economy from 1970 to 2010. To test the hypothesis (U-inverted) Environmental Kuznets Curve, the Johansen cointegration technique and Pesaran, Shin and Smith was used. It is found that there is a linear relationship between increasing emissions of carbon dioxide (CO2) and sulfur dioxide (SO2) as indicators of environmental degradation with the GDP per capita, together with trade liberalization, percentage of population urban and consumption of fossil fuel. Therefore, it is concluded that the Peruvian economy, in the study period, there is a positive relationship between economic growth and environmental degradation, that is, is in the first stage of the Environmental Kuznets Curve.