2. Explain the relationship between income and the quality of environmental and natural resources in a given

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2. Explain the relationship between income and the quality of environmental and natural resources in a given country. In particular, explain why one might expect an inverted-U-shaped relationship (an environmental Kuznets curve) between levels of per capita income and environmental degradation.

Can you think of any situations in which this relationship might not always exist? What does the evidence suggest? You can find additional information at www.perc.org/publications/research/kuznets2.php.

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