MODELING THE RELATIONSHIP BETWEEN ECONOMIC GROWTH, RESOURCE CONSUMPTION AND ENVIRONMENT POLLUTION BY SYSTEM DYNAMICS MODEL

Abstract

According to connotation and framework of sustainable development in urban economy — resource — environment, this study proposes a novel system dynamics model to deal with an issue of economy development in Chongqing of China restricted by depletion of resource and degradation of environment, by means of fundamental theory and methodology of system dynamics. Eight subsystems are involved in the model, which denote population, GDP, technology in production, labor input, capital input, renewable resource, nonrenewable resource and environment. To compare different policies with regard to their potential economy-resource-environment impacts, alternative scenarios are used by adjusting the parameters within the model and changing the specification of some variables. The results are elucidated as follows: the current economy — resource — environment system of Chongqing is not sustainable; the substitution rate of technology for resource is low and environment pollution becomes serious as a function of increasing output; a way to realize sustainable development of Chongqing is to optimize its economic development mode.