Measuring the Nexus Between Economic Development and Environmental Quality Based on Environmental Kuznets Curve: A Comparative Study Between China and Germany for the Period of 2000–2017

Abstract

With the rapid development of China’s economy, the problem of environmental pollution has become increasingly serious. Given that China’s current environmental quality threatens its long-term sustainable economic development, certain attention must be paid to curb environmental pollution in China. As a developed country with a high level of environmental quality in the world, Germany has experienced “Treatment after Pollution”. To promote China’s environmental quality, this study considers the historical lessons offered by Germany and examines the relationship between environmental pollution and economic development as well as the effective environmental governance mode in Germany and China.Based on the panel data of 30 provincial administrative regions in China and 16 states in Germany from 2000 to 2017, this study quantitatively investigates the nexus of economic growth and environmental pollution in the two countries. Empirical results demonstrate that, during the sample period of 2000–2017, the emissions of four pollutants in both countries increase initially and then decrease as the economy grows. The levels of per capita gross domestic product (GDP) that correspond to the emission peaks of sulfur dioxide,carbon dioxide, and nitrogen oxides are comparable in the two countries. Some economic and industrial policies may help to accelerate the occurrence of the turning point, including the following: decreasing the importance of a secondary industry; taking full advantage of the structural and technical effects brought about by foreign trade; reducing the reliance on non-clean energy; and carrying out more effective energy policies. In this regard,coordinating environmental policies with economic growth, formulating strict environmental policies, improving industrial structure, optimizing energy structure, and improving the quality of foreign trade are pivotal for China’s sustainable development goals.