IDEAS home Printed from https://ideas.repec.org/p/hal/journl/hal-03693920.html

Could the environment be a normal good for you and an inferior good for me? A theory of context-dependent substitutability and needs
[L'environnement pourrait-il être un bien normal pour vous et un bien inférieur pour moi ? Une théorie de la substituabilité dépendante du contexte et des besoins]

Author

Listed:
  • Marion Dupoux

    (GU - Göteborgs Universitet = University of Gothenburg, IFPEN - IFP Energies nouvelles, EconomiX - EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique)

  • Vincent Martinet

    (UMR PSAE - Paris-Saclay Applied Economics - AgroParisTech - Université Paris-Saclay - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CEPS - Centre d'Economie de l'ENS Paris-Saclay - Université Paris-Saclay - ENS Paris Saclay - Ecole Normale Supérieure Paris-Saclay)

Abstract

Theoretical models often assume the environment to be a normal good, irrespective of one's income. However, a priori, nothing prohibits an environmental good from being normal for some individuals and inferior for others. We develop a conceptual framework in which private consumption and an environmental public good act as substitutes or complements for satisfying different needs. Subsequently, the environment can switch between normal and inferior depending on one's income and environment and corresponding prevalent needs. If the environment is inferior for some range of income, then the willingness to pay for environmental preservation becomes non-monotonic with respect to income. We discuss the relevance of our framework in the context of (income-adjusted) unit benefit transfers, dual-rate discounting and the Environmental Kuznets curve.

Suggested Citation

  • Marion Dupoux & Vincent Martinet, 2022. "Could the environment be a normal good for you and an inferior good for me? A theory of context-dependent substitutability and needs [L'environnement pourrait-il être un bien normal pour vous et un," Post-Print hal-03693920, HAL.
    • Handle: RePEc:hal:journl:hal-03693920
    DOI: 10.1016/j.reseneeco.2022.101316
    Note: View the original document on HAL open archive server: https://hal.inrae.fr/hal-03693920v1
    as

    Download full text from publisher

    File URL: https://hal.inrae.fr/hal-03693920v1/document
    Download Restriction: no
    File URL: https://libkey.io/10.1016/j.reseneeco.2022.101316?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. is not listed on IDEAS
    2. Ellen Sterk, 2023. "Willingness to pay for recycled aggregates in concrete among German construction clients," MAGKS Papers on Economics 202311, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hal:journl:hal-03693920. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.