Econometric analysis of the national economy sustainable development based on environmental Kuznets curve

Abstract

The global environmental threats and related problems justify the need to shape parameters, conditions and mechanisms for sustainable development. This is especially urgent for developing countries. The purpose of the article is to study the environmental Kuznets curve hypothesis and to understand the key determinants of national economy sustainable development. The environmental Kuznets curve is estimated through the relationship between GDP and pollution volumes (e.g., sulphur dioxide, nitrogen dioxide, carbon oxide, and dioxide emissions). It was found that Ukraine has not reached a break-even point to start the sloping down pattern of pollution. The paper justifies the need for environmental investments to increase based on the relationships between current/capital environmental costs and air emissions. The paper suggests a specific shape of the environmental Kuznets curve (EKC) in Ukraine with several break-even points. It is proposed to formulate a coherent policy on economic, social, and environmental components necessary to create the conditions for achieving the break-even point parameters in the Ukrainian economy.