Income inequality and willingness to pay for environmental public goods
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In: Journal of Environmental Economics and Management, Vol. 85, 01.09.2017, p. 35-61.
Research output: Journal contributions › Journal articles › Research › peer-review
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TY - JOUR
T1 - Income inequality and willingness to pay for environmental public goods
AU - Baumgärtner, Stefan
AU - Drupp, Moritz A.
AU - Meya, Jasper N.
AU - Munz, Jan M.
AU - Quaas, Martin F.
PY - 2017/9/1
Y1 - 2017/9/1
N2 - We study how the distribution of income among members of society, and income inequality in particular, affects social willingness to pay (WTP) for environmental public goods. We find that social WTP for environmental goods decreases (increases) with income inequality if and only if environmental goods and manufactured goods are substitutes (complements). We derive adjustment factors for benefit transfer to control for differences in income distributions between a study site and a policy site. For illustration, we quantify how social WTP for environmental public goods depends on the respective income distributions for empirical case studies in Sweden and the World at large. We find that the adjustment for income inequality can be substantial.
AB - We study how the distribution of income among members of society, and income inequality in particular, affects social willingness to pay (WTP) for environmental public goods. We find that social WTP for environmental goods decreases (increases) with income inequality if and only if environmental goods and manufactured goods are substitutes (complements). We derive adjustment factors for benefit transfer to control for differences in income distributions between a study site and a policy site. For illustration, we quantify how social WTP for environmental public goods depends on the respective income distributions for empirical case studies in Sweden and the World at large. We find that the adjustment for income inequality can be substantial.
KW - Benefit transfer
KW - Environmental goods
KW - Income distribution
KW - Inequality
KW - Public goods
KW - Sustainability policy
KW - Willingness to pay
KW - Sustainability sciences, Management & Economics
UR - http://www.scopus.com/inward/record.url?scp=85018749011&partnerID=8YFLogxK
U2 - 10.1016/j.jeem.2017.04.005
DO - 10.1016/j.jeem.2017.04.005
M3 - Journal articles
AN - SCOPUS:85018749011
VL - 85
SP - 35
EP - 61
JO - Journal of Environmental Economics and Management
JF - Journal of Environmental Economics and Management
SN - 0095-0696
ER -