Estimating the Environmental Pollution Index from Stochastic Cost Frontier Models and Analysis of Impact Factors

Jiyoung Kong, Sukwan Jung, Sangmok Kang
2016 Journal of Environmental Policy and Administration  
This study examines the relationship between the environmental pollution index and income levels of 176 countries for 2011. First, we employ a stochastic cost frontier analysis to measure the global environmental pollution index. Second, we use Tobit regression to examine the Environmental Kuznets Curve (EKC) hypothesis. Also, the impact of economic factors on the environmental pollution index are considered. These economic factors include forest density, OECD membership status, investment
more » ... rtion, ratio of foreign trade to GDP, and ratio of manufacturing industry to GDP. The results indicate a significant inverted 'U' shape, in the relationship between the environmental pollution index and income, which supports the EKC. The economic factors like forest density, OECD membership status, and ratio of manufacturing industry to GDP also had a significant influence on the CO 2 index.
doi:10.15301/jepa.2016.24.3.207 fatcat:kg2wo42t6jd7jim6sslawvfpqu