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Distance to hazard: an environmental policy with income heterogeneity

Published online by Cambridge University Press:  26 September 2016

Minoru Nakada
Minoru Nakada*
Affiliation:
Graduate School of Environmental Studies, Nagoya University, and Faculty of Land and Food Systems, University of British Columbia, Furo, Chikusa, Nagoya 464-8601, Japan. E-mail: mnakada@cc.nagoya-u.ac.jp
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Abstract

This study examines whether voting by individuals of different income levels affects the stringency of environmental policy if their residential proximity to a pollution source is considered. A location model with heterogeneous agents is extended to include a single environmentally hazardous site at the edge of a linear city and the degree of damage from pollution is assumed to depend on the distance from this emissions site. The analysis demonstrates through majority voting that the equilibrium emissions tax rate is higher when the income level of the median voter is lower, because residents with low incomes reside near the hazardous site and thus benefit more from pollution abatement than residents with higher incomes.

Type
Research Article
Information
Environment and Development Economics , Volume 22 , Issue 1 , February 2017 , pp. 51 - 65
Copyright
Copyright © Cambridge University Press 2016 

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