An Empirical Test On The Relationship Between Economic Growth And Environmental Pollution

With the rapid economical development,environmental issues have aroused more and more concerns of people increasingly.The relationship between Economic Growth and Environmental Degradation has become a hot issue in today's world from scholars at home and abroad. The contradiction exists between faster economic growth and the deteriorating environment quality in China.As the leading province in the rising of central China,Henan Province is also faced with increasingly deteriorated environment. Henan is countrywide population the biggest province and agriculture are saved greatly, it is province of a developing. Henan's traditional industries always follow the mode of extensive economic growth,but the extensive growth style has come at great environmental cost. Along with the rapid economic growth and the improvement of life quality, people require higher quality of environmental products.So the environmental pollution has received a great deal of recent attention from relevant departments.The high-speed development of economy in Henan Province,on one hand it speeds up the process of industrialization,on the other hand,pollutant discharge quantity from life and industrial increased dramatically in recent years. Also it causes the state of the environment in Henan faces severe challenges.And increases the difficulty of implementing the Sustained Economic Development Strategy. One of the important aspects in carrying out the Sustainable Development Strategy is to realize the coordination development of economy and environment.Economic growth will result in different degree of environmental pollution, however,rapid economic growth whether will cause pollution mounts up or not,rely on the actual situation of different regions and different pollutants. The empirical analysis in this article based on the time-series data set during 1990-2009 in Henan in order to illustrate long-term dynamic mechanism between economic growth and environmental pollution, so that can analyse the relationship between the economic development and environmental pollution.This article selects the per capita GDP as the economic indicator and all kinds of pollutant discharge quantity as environmental pollution indexs.This paper analyse the double variable system VAR model that includes all kinds of pollution indexs and per capita GDP. Because the result of the impulse response function strictly dependent on the hypothesis that error vector whether meet white noise sequence vector or not.Therefore we first should do unit root test for time series. On one side,it shows there is a relationship of Johansen cointegration between GDP per capital and pollutant discharge quantity. On the other side,by employing Generalized Impulse Response Function and variance decomposition analysis, which are based on VAR method, we propose to illustrate long-term dynamic mechanism between economic growth and industry pollution in Henan. The empirical results suggest that the rapid economic growth may have led to more pollution emissions ,while pollution may have led to increase economic growth with some delay on the other. And the results of variance decomposition analysis suggest that in general GDP per capita is the main variable to explain the forecasting mean square error of the pollution variable but it's not true vice versa.The results suggest that rapid growth of economic in HenanProvince come back at the expense of contaminate environment.It should strengthen people's awareness of the coordinated development of the economy and the environment,so as to implement the Sustainable Development Strategy.At last this paper puts forward some suggestions aimed at the situation:first,speed up the industrial structure optimization promotion and the greening engineering of energy sources;second, give full play to the market mechanism and government decisions;third, increas the utilization rate of resources and speed up the development of circulatory economy.