This paper develops an endogenous growth model with imperfect competition. Under consideration for negative pollution externalities derived from consumption, the main purpose of this paper is to investigate the policy effect of abatement expenditures and taxes on economic growth in the long-run and dynamic transition in the short-run. We show that an increase in abatement expenditures is not only to decrease pollution but also to increase economic growth. Moreover, an increase in tax rates, both labor and capital income taxes, is not able to reduce the pollution and is against the economic growth.