On Income Inequality and Green Preferences
AbstractWe derive conditions on individual preferences and technology that give rise to a negative correlation between income inequality and environmental protection. We present a class of models (which captures a static model as well as an overlapping-generations model) in which individuals differ in earning abilities, and where a majority elected representative takes decisions over a pollution tax and a redistributive tax. We show that, if private consumption goods and the environment are non-inferior goods, then if the decisive individual has lower ability than the average, she will prefer a higher redistributive tax and a lower pollution tax.
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Bibliographic InfoPaper provided by University of Rochester - Wallis Institute of Political Economy in its series Wallis Working Papers with number WP30.
Date of creation: Oct 2002
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Postal: University of Rochester, Wallis Institute, Harkness 109B Rochester, New York 14627 U.S.A.
Environmental policy; redistribution; inequality; political economy;
Find related papers by JEL classification:
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
- H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
This paper has been announced in the following NEP Reports:
- NEP-AGR-2002-12-17 (Agricultural Economics)
- NEP-ALL-2002-11-18 (All new papers)
- NEP-PBE-2002-11-18 (Public Economics)
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