Question

Question 17 The inverted-U shape of the environmental Kuznets curve implies:

a. Emission of SO2 and CO2 decreases continuously as income per capita decreases.

b. The clean environment is an inferior good.

c. The clean environment is a luxury good.

d. Emission of SO2 and CO2 increases continuously as income per capita increases.

Answer 1

Option C is correct

According to the hypothesis as the GDP or the income level increases, there is an increase in the level of pollution or environmental degradation initially which reaches a maximum level and then it starts declining. This indicates that when income levels are low, there is a greater environmental degradation but when the income levels are very high environmental degradation is reduced. This happens only when clean environment is a luxury and pollution is an inferior good.

With low level of income, there is a greater pollution and limited clean environment. as the income level is increased the pollution level is reduced and more of the clean environment becomes affordable