Economic Growth, Carrying Capacity, and the Environment

Kenneth Arrow, Bert Bolin, Robert Costanza, Partha Dasgupta, Carl Folke, C. S. Holling, Bengt-Owe Jansson, Simon Levin, Karl-Göran Mäler, Charles Perrings, and David Pimentel, "Economic growth, carrying capacity, and the environment," Science, 1995.

The general proposition that economic growth is good for the environment has been justified by the claim that there exists an empirical relation between per capita income and some measures of environmental quality. It has been observed that as income goes up there is increasing environmental degradation up to a point, after which environmental quality improves. (The relation has an "inverted-U" shape.) ...

So far the inverted U-shaped curve has been shown to apply to a selected set of pollutants only. However, because it is consistent with the notion that people spend proportionately more on environmental quality as their income rises, economists have conjectured that the curve applies to environmental quality generally. But it is important to be clear about the conclusions that can be drawn from these empirical findings. While they do indicate that economic growth may be associated with improvements in some environmental indicators, they imply neither that economic growth is sufficient to induce environmental improvement in general, nor that the environmental effects of growth may be ignored, nor, indeed, that the Earth's resource base is capable of supporting indefinite economic growth. In fact, if this base were to be irreversibly degraded, economic activity itself could be at risk.