Economic Growth and Environment: Evaluation of the Intrinsic Link

Economic Growth and Environment: Evaluation of the Intrinsic Link
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Introduction
Since the beginning of the Industrial Revolution, the economy of the industrialized nation has gone through remarkable transformations from peasant-based economies to highly complex industrial economies. This transition accelerated economic growth characterized by urbanization and rising standards of life: the two indicators of modernization. Nevertheless, the unscrupulous pursuit of economic development and the proportional increase in environmental pollution exposed the intrinsic relationship between the environment and economics (Liang & Yang, 2019). Scholars have highlighted the inexorable relationship between the natural environment and economic growth by identifying the direct and indirect contribution of the natural environment to economic activities. However, this relationship is highly complex as several factors, such as the scale and scope of the economy, level of technological advancement, and use of techniques to reduce environmental impact, define this relationship (Everett et al., 2010).
However, the increase in economic growth has resulted in the depletion of natural resources and environmental pollution, and these problems have jeopardized sustainable economic growth, as governments are under pressure to decouple economic activity from environmental resources. Nevertheless, for sustained economic growth, an effective government-based environmental policy is required; this policy should be based on the principles of sustainable use of natural resources to manage pollution and retain the economic growth curve. Therefore, the following discussion provides an in-depth analysis of the relationship between the environment and economic growth to highlight the requirement of this environmental policy.
Discussion
The Role of Environment in Economic Growth
The natural environment is essential to human economic activity as it provides raw materials such as water, timber, fossil fuel, minerals, and land for establishing factories and industrial hubs. Without this supply of material goods, economic growth will remain a far-fetched dream, as without this input, the economy cannot produce the goods and services required by the modern consumer (Everett et al., 2010). Besides this direct contribution, the natural environment also runs and maintains economic activity indirectly through its natural mechanism of recycling materials. Moreover, the natural ecosystem plays a vital role in carbon sequestration (capturing and storing atmospheric carbon); in this way, they provide a regular supply of carbon compounds to the industrial sector (Everett et al., 2010). This natural process is the driving force behind the smooth flow of resources in the economic system.
The natural ecosystem also contributes to economic growth and sustainability by providing free-of-cost services in natural water purification and prevention and management of flood risks. This aspect of the natural environment is the most significant as consuming the natural environment jeopardizes the natural recycling of materials in the ecosystem and weakens ...