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A Random Utility Model of Environmental Equity

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  • Diane Hite

Abstract

Past attempts to uncover evidence that economically disadvantaged groups are unjustly exposed to environmental disamenities have failed to take into account self-selection behavior of individuals or groups of individuals. For instance, when choosing a place to live, households may be trading environmental quality for other housing, neighborhood, and location characteristics they care about. Previous literature on environmental justice has investigated location choice of polluting industries, but fails to account for consumer self-selection in housing markets. This paper thus focuses on location choice of individuals based on observed housing transactions. From the results of a random utility model, a test is proposed that incorporates the no-envy concept of economic equity. The results support a finding for environmental discrimination with respect to African American households, but do not support the hypothesis that poor households in general are unfairly exposed to environmental disamenities. Copyright 2000 Gatton College of Business and Economics, University of Kentucky.

Suggested Citation

  • Diane Hite, 2000. "A Random Utility Model of Environmental Equity," Growth and Change, Wiley Blackwell, vol. 31(1), pages 40-58.
  • Handle: RePEc:bla:growch:v:31:y:2000:i:1:p:40-58
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    Cited by:

    1. Don Fullerton, 2008. "Distributional Effects of Environmental and Energy Policy: An Introduction," NBER Working Papers 14241, National Bureau of Economic Research, Inc.
    2. Becker, Randy A., 2005. "Air pollution abatement costs under the Clean Air Act: evidence from the PACE survey," Journal of Environmental Economics and Management, Elsevier, vol. 50(1), pages 144-169, July.
    3. Baden, Brett M. & Coursey, Don L., 2002. "The locality of waste sites within the city of Chicago: a demographic, social, and economic analysis," Resource and Energy Economics, Elsevier, vol. 24(1-2), pages 53-93, February.
    4. repec:kap:jrefec:v:56:y:2018:i:1:d:10.1007_s11146-016-9591-y is not listed on IDEAS
    5. Abdul-Mohsen, Ashraf & Hitzhusen, Frederick J., 2006. "Environmental Injustice: An Ohio Case Study," 2006 Annual meeting, July 23-26, Long Beach, CA 21061, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    6. Andres Jauregui & Alan Tidwell & Diane Hite, 2017. "Sample Selection Approaches to Estimating House Price Cash Differentials," The Journal of Real Estate Finance and Economics, Springer, vol. 54(1), pages 117-137, January.

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