Environmental intensity of economic growth in the Baltic Sea region

Abstract

National economic development is subject to a number of restrictions. One of the main con­straints is the threat of complete exhaustion of non-renewable resources and environmen­tal pollution exceeding the capacity of the planet. However, the rapid spread of resource-saving technologies is reducing the environmental intensity of economic activities. In this study, I aim to examine the ecological-economic dynamics of the environmental effects of economic development in the regions of Russia's North-Western Federal District (NWFD). I employ an extended version of Peter A. Victor's model to produce a comprehensive evalua­tion of chang­es in economic indicators and correlate them with the total and specific environmental im­pact. Iconduct a factor analysis to identify the main effects influencing theecologica-eco­nomic dynamics. The use of water resources in the NWFD demonstrates green growth, whereas electricity consumption and wastewater treatment fall into the brown zone and in­dustrial and municipal waste treatment into the black one. The factor analysis has shown that population change has a very weak effect on the situation. Much more influential factors are the income effect (higher incomes translate into greater consumption and thus more signifi­cant pollution levels) and the technological effect produced by a decrease in the environmen­tal intensity of production. To promote green development, it is advisable to in­crease the in­fluence of the technological effect by stimulating resource efficiency and switch­ing to the cir­cular economy model.