Economic Freedom and Carbon Dioxide Emissions
The relationship between economic freedom and its impact on the quality of the environment is rarely investigated. In order to outline important links in understanding such a relationship, it is important to comprehend the different types of economic freedoms such as fiscal, monetary, and trade freedoms. However, the primary focus in this paper will be evaluating the extent of economic growth that the world can sustain without despoiling the environment beyond repair.
Physical and Social Scientists such as Meadows argue that economic growth is accompanied by increasing demand for material and energy inputs. Consequently, there is increased waste by-products and also there is increased demand for natural resources. Eventually, there is an increase in extraction activities, leading to accumulation of waste and also there is a concentration of pollutants. Carbon dioxide is one of the largest emissions from processing plants, and therefore the biosphere is overwhelmed, and the environmental quality is degraded even though the economy may be on the rise. Furthermore, Daly also argues that the economy needs to be saved from its growth to ensure steady-state economy and prevent the degradation of the resource base.
On the flip side, some social scientists argue that economic growth can lead to environmental improvement. Beckerman argues that higher income leads to increase in demand for commodities and also services that have a lesser material basis than in low income. Higher income also leads to the need for improved environment quality. Despite the above analogy, it is Kuznets’s works that result in the establishment of the relation between economic growth and environmental pollution in a curve known as environmental Kuznets curve. According to this model, little economic growth greatly influences the intensity of environmental degradation. Economic growth is usually measured in GDP per capita. The onset of industrialization is characterized by intensification of resource extraction and acceleration of waste generation. At higher levels of economic development, there are efficient technologies applied and hence there is a steady state relation between economic growth and environmental quality.
In conclusion, an increase in aspects of economic freedom such as fiscal freedom, trade freedom and monetary freedom can significantly improve environmental quality after an income threshold level has been achieved. From the analysis above, and higher GDP per capita can increase environmental degradation slightly than in low-income countries. It is a steady state relation between the economic and the quality of the environment that determines the balance between the two aspects of life.