Income inequality and willingness to pay for environmental public goods


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Date

2017-09

Publication Type

Journal Article

ETH Bibliography

no

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Abstract

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.

Publication status

published

Editor

Book title

Volume

85

Pages / Article No.

35 - 61

Publisher

Elsevier

Event

Edition / version

Methods

Software

Geographic location

Date collected

Date created

Subject

Environmental goods; Public goods; Income distribution; Inequality; Willingness to pay; Benefit transfer; Sustainability policy

Organisational unit

09845 - Drupp, Moritz / Drupp, Moritz check_circle

Notes

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