Abstract
Potential conflicts between economic growth and environmental degradation are central to the sustainable development debate. An endogenous growth model is used to investigate tradeoffs between economic growth and environmental quality, where growth is dependent on technology improvements, emissions are generated during final goods production, and physical resources can be used to abate pollution. Pollution growth is higher in a decentralized economy, but technology growth rates can not be ranked between the efficient and equilibrium paths. Even with restricted abatement activity, second-best pollution growth will be below the unregulated level. Zero economic growth policies may increase the rate of environmental degradation.
