Consumerism and Environment: Does Consumption Behaviour Affect Environmental Quality?

Abstract

The literature has typically expressed environmental quality as a function of per capita income ignoring the role consumption choices can play as a potential mediating factor between environmental degradation and economic growth. Consumption can affect the environment in many ways: higher levels of consumption (and therefore higher levels of production) require larger inputs of energy and material and generate larger quantities of waste by products. Increased extraction and exploitation of natural resources, accumulation of waste and concentration of pollutants can damage the environment and, on the long run, limit economic activity. Rebus sic stantibus, consumerism, a term used by sociologists to describe the effects of equating personal happiness with purchasing material possessions, can even do worse as long as it determines an increase in the amount of purchased goods. The object of this article is to analyse the relationship between consumerism and environment. We critically review the empirical findings of the Environmental Kuznets Curve literature, according to which an inverted U-relationship between environmental degradation and economic growth is observed. In particular, we focused our attention on consumption-based approaches to the income-environment relation in order to better identify the impact of consumerism on the environment. We finally suggest a possible specification and estimation of a reduced form equation relating several impact indicator to consumption per capita.

Keywords: Environmental Kuznets Curve, Environment, Economic Growth, Pollution

JEL Classification: Q5, O4