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Moral Behaviour, Altruism and Environmental Policy

Author

Listed:
  • Marc Daube

    (University of St Andrews)

  • David Ulph

    (University of St Andrews)

Abstract

Free-riding is often associated with self-interested behaviour. However if there is a global mixed pollutant, free-riding will arise if individuals calculate that their emissions are negligible relative to the total, so total emissions and hence any damage that they and others suffer will be unaffected by whatever consumption choice they make. In this context consumer behaviour and the optimal environmental tax are independent of the degree of altruism. For behaviour to change, individuals need to make their decisions in a different way. We propose a new theory of moral behaviour whereby individuals recognise that they will be worse off by not acting in their own self-interest, and balance this cost off against the hypothetical moral value of adopting a Kantian form of behaviour, that is by calculating the consequences of their action by asking what would happen if everyone else acted in the same way as they did. We show that: (a) if individuals behave this way, then altruism matters and the greater the degree of altruism the more individuals cut back their consumption of a ’dirty’ good; (b) nevertheless the optimal environmental tax is exactly the same as that emerging from classical analysis where individuals act in self-interested fashion.

Suggested Citation

  • Marc Daube & David Ulph, 2014. "Moral Behaviour, Altruism and Environmental Policy," Discussion Paper Series, School of Economics and Finance 201409, School of Economics and Finance, University of St Andrews.
  • Handle: RePEc:san:wpecon:1409
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    File URL: http://www.st-andrews.ac.uk/~wwwecon/repecfiles/4/1409.pdf
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    Cited by:

    1. Lorenzo Cerda Planas, 2018. "Moving Toward Greener Societies: Moral Motivation and Green Behaviour," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 70(4), pages 835-860, August.
    2. Dasgupta, Partha & Southerton, Dale & Ulph, Alistair & Ulph, David, 2014. "Consumer Behaviour in a Social Context: Implications for Environmental Policy," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 2015-10, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Partha Dasgupta & Dale Southerton & Alistair Ulph & David Ulph, 2016. "Consumer Behaviour with Environmental and Social Externalities: Implications for Analysis and Policy," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 65(1), pages 191-226, September.
    4. Partha Dasgupta & Dale Southerton & Alistair Ulph & David Ulph, 2014. "Consumer Behaviour in a Social Context: Implications for Environmental Policy," Discussion Paper Series, School of Economics and Finance 201407, School of Economics and Finance, University of St Andrews.
    5. Dasgupta, Partha & Southerton, Dale & Ulph, Alistair & Ulph, David, 2014. "Consumer Behaviour in a Social Context: Implications for Environmental Policy," SIRE Discussion Papers 2015-10, Scottish Institute for Research in Economics (SIRE).

    More about this item

    Keywords

    Altruism; Climate Change; Environmental Economics; Environmental Tax; Externalities; Moral Behaviour; Pro-Social Behaviour; Public Goods;

    JEL classification:

    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory

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