Mina Salehnia - Ph.D Candidate of Agricultural Economics, Tabriz University,
Baballah hayati - Associate Professor of Agricultural Economics, Tabriz University,

In this paper a one-sector endogenous growth model in which renewable natural resources are both a factor of production and measure of environmental quality is developed. Along the balanced growth path, sustained economic growth and a non-deteriorating environment are shown to coexist. Moreover, steady-state economic growth and natural-resource utilization are positively related. Empirically, a cross-country growth regression that includes a broad measure of productive natural resources — the Ecological Footprint — provides strong support. Estimation results also suggest that growth strategies based on greater physical capital formation and trade openness outperform those relying on more intensive utilization of the environment. Hence, higher usage of natural resources today may boost economic growth in the short run, but will likely decrease its steady-state level, thus permanently reducing the economy’s long-run rate of output growth. Therefore, optimized utilization of natural resources would ensure sustainable development for nations.

Ecological footprint, Economic growth, Natural resources, sustainable development