Economic Analysis of Driving Force of Air Pollution During the Transition Process: EKC Hypothesis testing in the Czech Republic
Abstract
This paper aims at a quantitative assessment of main possible driving forces of the changes in the environmental pressure due to air pollution in the Czech Republic during the transition. We focus on a relation between economic performance and main air quality indicators ? SO2, NOx, CxHy, CO, particulates, and GHG emissions ? during 1995 to 2005 in the Czech Republic.
We decompose the change on three effects: ?scale?, ?composition? and ?intensity?. We find that ? after controlling for the ?scale? effect, changes in emission levels were firstly caused mainly due to a change in economic structure, and then followed by the ?intensity? effect.
The fall in emission intensities was associated with an increase in capital or labour productivity (or both) suggesting that the productivity increase experienced by the Czech industry has been resource-saving rather than resource-using, while potential of an autonomous technology diffusion to reduce emission has been almost exhausted.