Environmental and Resource Economics

, Volume 74, Issue 4, pp 1497–1518 | Cite as

The Effect of Growth and Corruption on Soil Sealing in Italy: A Regional Environmental Kuznets Curve Analysis

  • Salvatore BimonteEmail author
  • Arsenio Stabile


This paper analyses and looks more closely at the empirical debate regarding the Income Elasticity Hypothesis postulated in relation to the Environmental Kuznets Curve, and the impact of corruption on the relationship between growth and environmental impact, measured in terms of soil sealing, as proxied by the number of Building Permits issued by public authorities. It postulates that when current private rent is high compared to perceived social costs and a large enough minority benefits from the rules, the EKC does not emerge and public intervention fails to perceive social optimality. To validate this hypothesis, we run a panel data regression model based on data from all Italian regions. Results confirmed the hypothesis evidencing a U-shaped relationship, i.e. a detrimental relationship between income and environmental impact/quality. It also demonstrated that this is contingent on the level of corruption. The latter affects the position and the shape of the inverted EKC, speeding up the exploitation process. It shows that the higher the income, the higher the effect of corruption on the environment. Therefore, it advocates caution against any simplistic inference from EKC.


Environmental Kuznets curve Urban policy Land use Soil sealing Corruption 

JEL Classification

C23 D72 D73 O44 Q24 



  1. Acemoglu D, Verdier T (1998) Property rights, corruption and the allocation of talent: a general equilibrium approach. Econ J 108:1381–1403. CrossRefGoogle Scholar
  2. Andrews D, Caldera Sánchez A, Johansson A (2011) Housing markets and structural policies in OECD countries, OECD Economics Department working papers, no. 836. OECD Publishing, ParisGoogle Scholar
  3. Ball M, Meen G, Nygaard C (2010) Housing supply price elasticities revisited: evidence from international, national, local and company data. J Hous Econ 19:255–268. CrossRefGoogle Scholar
  4. Beckerman W (1992) Economic growth and the environment: Whose growth? Whose environment? World Dev 20:481–496. CrossRefGoogle Scholar
  5. Bernardi F, Poggio T (2004) Home ownership and social inequality in Italy. In: Kurz K, Blossfeld H-P (eds) Home ownership and social inequality in comparative perspective. Stanford University Press, Stanford, pp 187–232Google Scholar
  6. Bimonte S (2012) Public goods, environmental quality and the EKC. The “unsaid” of the intensity of use indices. Int J Sustain Econ 4:167–180. CrossRefGoogle Scholar
  7. Bimonte S, Stabile A (2015) Local taxation and urban development. Testing for the side-effects of the Italian property tax. Ecol Econ 120:100–107. CrossRefGoogle Scholar
  8. Bimonte S, Stabile A (2017a) Land consumption and income in Italy: a case of inverted EKC. Ecol Econ 131:36–43. CrossRefGoogle Scholar
  9. Bimonte S, Stabile A (2017b) EKC and the income elasticity hypothesis land for housing or land for future? Ecol Indic. CrossRefGoogle Scholar
  10. Bimonte S, Stabile A (2019) The impact of the introduction of Italian property tax on urban development: a regional regression model. Hous Stud. CrossRefGoogle Scholar
  11. Biswas AK, Farzanegan MR, Thum M (2012) Pollution, shadow economy and corruption: theory and evidence. Ecol Econ 75:114–125. CrossRefGoogle Scholar
  12. Carson RT (2010) The environmental Kuznets curve: seeking empirical regularity and theoretical structure. Rev Environ Econ Policy 4:3–23. CrossRefGoogle Scholar
  13. Cole MA (2007) Corruption, income and the environment: an empirical analysis. Ecol Econ 62:637–647. CrossRefGoogle Scholar
  14. Cole MA, Elliott RJR, Fredriksson PG (2006) Endogenous pollution havens: does FDI influence environmental regulations? Scand J Econ 108:157–178. CrossRefGoogle Scholar
  15. Common M (1995) Sustainably and policy: limits to economics. Cambridge University Press, MelbourneGoogle Scholar
  16. Copeland BR, Taylor MS (2004) Trade, growth, and the environment. J Econ Lit 42:7–71. CrossRefGoogle Scholar
  17. Cotta M, Maruhn R, Colin C (2017) Italy report: sustainable governance indicators 2017. Gütersloh, GermanyGoogle Scholar
  18. Damania R, Fredriksson PG, List JA (2003) Trade liberalization, corruption, and environmental policy formation: theory and evidence. J Environ Econ Manage 46:490–512. CrossRefGoogle Scholar
  19. Dinda S (2004) Environmental Kuznets curve hypothesis: a survey. Ecol Econ 49:431–455. CrossRefGoogle Scholar
  20. EEA, JCR (2006) Urban sprawl in Europe—the ignored challenge, European Environment Agency and Joint Research Centre. Copenhagen. CrossRefGoogle Scholar
  21. EEA, JCR (2010) The European environment: state and outlook 2010. Land Use, Copenhagen. CrossRefGoogle Scholar
  22. EEA, JCR (2010b) The European environment state and outlook 2010. Soil. Copenhagen. doi:
  23. Ehrlich I, Lui FT (1999) Bureaucratic corruption and endogenous economic growth. J Polit Econ 107:270–293CrossRefGoogle Scholar
  24. EU (2017) Special eurobarometer 470 report corruption. Brussels.
  25. European Commission (2014) Report from the commission to the council and the European paliament. EU anti-corruption report. BrusselsGoogle Scholar
  26. Fredriksson PG, List JA, Millimet DL (2003) Bureaucratic corruption, environmental policy and inbound US FDI: theory and evidence. J Public Econ 87:1407–1430. CrossRefGoogle Scholar
  27. Fredriksson PG, Vollebergh HRJ, Dijkgraaf E (2004) Corruption and energy efficiency in OECD countries: theory and evidence. J Environ Econ Manage 47:207–231. CrossRefGoogle Scholar
  28. Goodhart C, Hofmann B (2008) House prices, money, credit, and the macroeconomy. Oxford Rev Econ Policy 24:180–205. CrossRefGoogle Scholar
  29. Green RK, Malpezzi S, Mayo SK (2005) Metropolitan-specific estimates of the price elasticity of supply of housing, and their sources. Am Econ Rev 95:334–339. CrossRefGoogle Scholar
  30. Grossman GM, Krueger AB (1995) Economic growth and the environment. Q J Econ 110:353–377. CrossRefGoogle Scholar
  31. Hilber CAL, Vermeulen W (2012) The impact of supply constraints and house price in England, CPB discussion paperGoogle Scholar
  32. Hsiao C (2003) Analysis of panel data. Cambridge University Press, Cambridge. CrossRefGoogle Scholar
  33. Iacoviello M, Neri S (2010) Housing market spillovers: evidence from an estimated DSGE model. Am Econ J Macroecon 2:125–164. CrossRefGoogle Scholar
  34. ICAC (1990) Annual report to June 1990. SidneyGoogle Scholar
  35. Ihlanfeldt K, Mayock T (2014) Housing bubbles and busts: the role of supply elasticity. Land Econ. 90:79–99CrossRefGoogle Scholar
  36. ISPRA (2017) Consumo di suolo, dinamiche territoriali e servizi ecosistemici. Roma, ItaliaGoogle Scholar
  37. ISTAT (2004) 14° Censimento generale della popolazione e delle abitazioni. Istituto Nazionale di Statistica, Roma, ItaliaGoogle Scholar
  38. ISTAT (2014) 15° Censimento generale della popolazione e delle abitazioni. Istituto Nazionale di Statistica, Roma, ItaliaGoogle Scholar
  39. ISTAT (n.d.) Annuario delle statistiche giudiziarie penali. Istituto Nazionale di Statistica, Roma, ItaliaGoogle Scholar
  40. JCR, EC (2012) The state of soil in Europe, JCR reference report. Luxembourg.
  41. Jedwab R, Vollrath D (2015) Urbanization without growth in historical perspective. Explor Econ Hist 58:1–21. CrossRefGoogle Scholar
  42. Leitão A (2010) Corruption and the environmental Kuznets curve: empirical evidence for sulfur. Ecol Econ 69:2191–2201. CrossRefGoogle Scholar
  43. Lisciandra M, Migliardo C (2017) An empirical study of the impact of corruption on environmental performance: evidence from panel data. Environ Resour Econ 68:297–318. CrossRefGoogle Scholar
  44. López R (1994) The environment as a factor of production: the effects of economic growth and trade liberalization. J Environ Econ Manage 27:163–184. CrossRefGoogle Scholar
  45. López R, Mitra S (2000) Corruption, pollution, and the Kuznets environment curve 1. J Environ Econ Manage 40:137–150CrossRefGoogle Scholar
  46. Masters AB, Graycar A (2016) Making corruption disappear in local government. Public Integr 18:42–58. CrossRefGoogle Scholar
  47. Mauro P (1995) Corruption and growth. Q J Econ 110:681–712. CrossRefGoogle Scholar
  48. MEF, AE (2017) Gli immobili in Italia: ricchezza, reddito e fiscalità immobiliare. Roma, ItaliaGoogle Scholar
  49. Mishkin FS (2007) Housing and the monetary transmission mechanism (No. 13518), NBER working papers. National Bureau of Economic Research, IncGoogle Scholar
  50. Mo PH (2001) Corruption and economic growth. J Comp Econ 29:66–79. CrossRefGoogle Scholar
  51. Monk S, Whitehead CME (1996) Land supply and housing: a case-study. Hous Stud 11:407–423CrossRefGoogle Scholar
  52. Muelbauer J (2008) Housing. Credit and Consumer Expenditure, LondonGoogle Scholar
  53. OECD (2013) Issues paper on corruption and economic growth. Pap. to be Present. to G20 Leaders St. Petersbg (Summit)Google Scholar
  54. OECD (2014) The rationale for fighting corruption, CleanGovBiz Initiative. Organisation for Economic Cooperation and Development, ParisGoogle Scholar
  55. OECD (2015) Consequences of corruption at the sector level and implications for economic growth and development. Paris.
  56. Panayotou T (2003) Economic growth and the environment. Econ Surv EurGoogle Scholar
  57. Pellegrini L, Gerlagh R (2004) Corruption’s effect on growth and its transmission channels. KYKLOS 57:429–456CrossRefGoogle Scholar
  58. Pellegrini L, Gerlagh R (2006) Corruption and environmental policies: what are the implications for the enlarged EU? Eur Environ 16:139–154. CrossRefGoogle Scholar
  59. Pezzey JCV (1989) Economic analysis of sustainable growth and sustainable development (No. 15), Environment Department working paperGoogle Scholar
  60. Rashidghalam M, Heshmati A, Dashti G, Pishbahar E (2016) A comparison of panel data models in estimating technical efficiency (No. IZA DP No. 9807), Discussion paper seriesGoogle Scholar
  61. Rehman FU, Nasir M, Kanwal F (2012) Nexus between corruption and regional Environmental Kuznets Curve: the case of South Asian countries. Environ Dev Sustain 14:827–841. CrossRefGoogle Scholar
  62. Roy KC, Tisdell CA (1998) Good governance in sustainable development: the impact of institutions. Int J Soc Econ 25:1310–1325. CrossRefGoogle Scholar
  63. Selden TM, Song D (1994) Environmental quality and development: is there a Kuznets curve for air pollution? J Environ Econ Environ Manag 27:147–162CrossRefGoogle Scholar
  64. Smiraglia D, Ceccarelli T, Bajocco S, Salvati L, Perini L (2016) Linking trajectories of land change, land degradation processes and ecosystem services. Environ Res 147:590–600. CrossRefGoogle Scholar
  65. Somerville CT (2001) Permits, starts, and completions: structural relationships versus real options. Real Estate Econ 29:161–190. CrossRefGoogle Scholar
  66. Taltavull de La Paz P, White M (2012) Fundamental drivers of house price change: the role of money, mortgages, and migration in Spain and the United Kingdom. J Prop Res 29:341–367. CrossRefGoogle Scholar
  67. TI (2017) Corruption perceptions index 2017. Transparency International, BerlinGoogle Scholar
  68. Tiebout CM (1956) A pure theory of local expenditures. J Polit Econ 64:416–424. CrossRefGoogle Scholar
  69. Ugur M, Dasgupta N (2011) Evidence on the economic growth impacts of corruption in low-income countries and beyond: a systematic review. EPPI-Centre, Social Science Research Unit, Institute of Education, University of London, LondonGoogle Scholar
  70. Welsch H (2004) Corruption, growth, and the environment: a cross-country analysis. Environ. Dev. Econ. 9:663–693. CrossRefGoogle Scholar
  71. White M, Allmendinger P (2003) Land-use planning and the housing market: a comparative review of the UK and the USA. Urban Stud 40:953–972. CrossRefGoogle Scholar

Copyright information

© Springer Nature B.V. 2019

Authors and Affiliations

  1. 1.Department of Economics and StatisticsUniversity of SienaSienaItaly
  2. 2.Department of Business and LawUniversity of SienaSienaItaly

Personalised recommendations