Revisiting the Environmental Kuznets Curve Model: Greenhouse Gas Emissions within Canada

Abstract

The change in human behavior from living on the land to living off of the land's resources through industrialization, increasing living standards, and rising incomes have been marked by rapidly increasing emissions of greenhouse gasses (GHGs) into the earth’s atmosphere. The Environmental Kuznets curve (EKC) hypothesis posits that as income grows, environmental degradation increases until an economy reaches a tipping point, beyond which environmental degradation will decline as income increases (Stern, 2004). This study empirically examines the validity of the EKC hypothesis as applied to Canada’s provinces and territories from 1990-2020, using data on GHG emissions and GDP per capita as environmental degradation and income indicators. Overall, the results of this study support the EKC hypothesis at the Canadian level and confirm the results found by previous studies. Confirmation of the EKC indicates that increasing economic growth in Canada’s provinces and territories is unlikely to lead to higher greenhouse gas emissions and instead is likely to result in decreasing GHG emissions.