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Voting for Environmental Policy Under Income and Preference Heterogeneity

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Author Info
Essi Eerola
Anni Huhtala

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Abstract

We examine the design of policies for promoting the consumption of green products under preference and income heterogeneity using organic food as an example. Two instruments are considered: a price subsidy for organic food products and a tax on conventional products. When the income differences and social benefits of organic farming are large, these factors dominate in shaping the policy preferences of the majority. In this case, the environmental policies preferred by the majority tend to be stricter than socially optimal policies. However, when income differences are small, policy preferences are more directly determined by tastes for organic products and the majority may prefer no intervention. Copyright ©2008 American Agricultural Economics Association.

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Article provided by American Agricultural Economics Association in its journal American Journal of Agricultural Economics.

Volume (Year): 90 (2008)
Issue (Month): 1 (02)
Pages: 256-266
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Handle: RePEc:bla:ajagec:v:90:y:2008:i:1:p:256-266

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  1. West, Sarah E., 2004. "Distributional effects of alternative vehicle pollution control policies," Journal of Public Economics, Elsevier, vol. 88(3-4), pages 735-757, March. [Downloadable!] (restricted)
  2. Nyborg, Karine & Howarth, Richard B. & Brekke, Kjell Arne, 2006. "Green consumers and public policy: On socially contingent moral motivation," Resource and Energy Economics, Elsevier, vol. 28(4), pages 351-366, November. [Downloadable!] (restricted)
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  3. Pauline M. Ippolito, 2003. "Asymmetric Information in Product Markets: Looking to Other Sectors for Institutional Approaches," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 85(3), pages 731-736, 08. [Downloadable!] (restricted)
  4. Brooks, Nancy & Sethi, Rajiv, 1997. "The Distribution of Pollution: Community Characteristics and Exposure to Air Toxics," Journal of Environmental Economics and Management, Elsevier, vol. 32(2), pages 233-250, February. [Downloadable!] (restricted)
  5. Annegrete Bruvoll & Karine Nyborg, 2004. "The Cold Shiver of Not Giving Enough: On the Social Cost of Recycling Campaigns," Land Economics, University of Wisconsin Press, vol. 80(4). [Downloadable!] (restricted)
  6. West, Sarah E. & Williams, R.C.Roberton III, 2004. "Estimates from a consumer demand system: implications for the incidence of environmental taxes," Journal of Environmental Economics and Management, Elsevier, vol. 47(3), pages 535-558, May. [Downloadable!] (restricted)
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  7. Hamilton, Stephen F. & Sunding, David L. & Zilberman, David, 2003. "Public goods and the value of product quality regulations: the case of food safety," Journal of Public Economics, Elsevier, vol. 87(3-4), pages 799-817, March. [Downloadable!] (restricted)
  8. McAusland, Carol, 2003. "Voting for pollution policy: the importance of income inequality and openness to trade," Journal of International Economics, Elsevier, vol. 61(2), pages 425-451, December. [Downloadable!] (restricted)
  9. Bjorner, Thomas Bue & Hansen, L.G.Lars Garn & Russell, Clifford S., 2004. "Environmental labeling and consumers' choice--an empirical analysis of the effect of the Nordic Swan," Journal of Environmental Economics and Management, Elsevier, vol. 47(3), pages 411-434, May. [Downloadable!] (restricted)
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  1. Markus Haavio & Kaisa Ilona Kotakorpi, 2009. "The Political Economy of Sin Taxes," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
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