Concerns over the pace, scope and causes of environmental degradation have led to a renewed interest in the way environmental and economic policies interact. This paper first reviews the main causes for excessive use of environmental resources in a market economy, and how governments may conduct policies to counter environmental degradation. The focus of the paper then shifts towards the implications of economic growth on overall wealth and the possibilities for preserving or expanding the basis of this wealth, particularly in relation to the notion of sustainable development. Finally, it examines policy options for limiting global environmental problems such as climate change, in particular as regards the trade-offs involved in curbing the use of fossil fuels ...