ABSTRACT
Economic and environmental objectives are often presented as conflicting goals. A common theme in political debates in recent years is that certain environmental regulations result in unacceptable job losses. This chapter explores the relationship between protecting the environment and economic growth. Some recent policy proposals suggest that a well-designed response to current environmental and energy challenges can actually be the engine for future economic development. A more ambitious goal is to create a new 'green economy' that embodies the concept of sustainable development. The Keystone XL pipeline was proposed in 2008 by the TransCanada Corporation to transport oil from Alberta to Nebraska. The chapter shows how environmental protection impacts economic performance, and how economic growth impacts environmental quality. The idea that environmental regulation can lead to lower costs for firms has become known as the Porter hypothesis. The term decoupling has been defined by the OECD as breaking the link between 'environmental bads' and 'economic goods'.
