Environment, energy and sustainable economic growth

Abstract

Abstract Sustainable energy utilization and environmental protection are important to sustainable economic growth. In this paper, we develop an endogenous economic growth model and discuss the optimal path of sustainable economic growth with the constraints of energy and environment. We find that sustainable economic growth can be achieved only when the relative contribution rate of environment protection investment to environmental quality is more than the relative contribution rate of combined input of energy and environment to production. The results indicate that long-run growth requires not only a continuous energy intensity decrease and technology progress in the fields of energy resources exploitation, exaction, refinement and utilization, but also an optimal structure adjustment from depending on nonrenewable energy to renewable energy.