Climate Change, Inequality and Social Policy seminar series

Fifth seminar, Thursday 27th April 2017 , 12.00 - 13.30

(including a sandwich lunch)

Would income redistribution result in higher aggregate emissions?

Lutz Sager (PhD Student in Environmental Economics, LSE)

Discussants:

Professor Angela Druckman (Centre for the Understanding of Sustainable Prosperity, University of Surrey)

Ian Gough, Visiting Professor CASE and Grantham Research Institute, LSE.

This paper analyses the relationship between the distribution of income and the carbon content of household consumption. Household carbon is estimated by linking expenditure data to productive sectors and their carbon intensity derived through input-output analysis. Environmental Engel curves (EECs) are constructed, which describe the relationship between household income and CO2 in the United States between 1996 and 2009. This makes possible a number of analyses, including the decomposition of household carbon inequality. A potential “equity-pollution dilemma” is described and quantified. Assuming that Engel curve estimates are appropriate, we find that complete income redistribution might have raised household carbon in 2009 by about 2.5%.

Would income redistribution result in higher aggregate emissions? (Lutz Sager)