Income inequality and the environment: Aggregation bias in environmental Kuznets curves

N. Heerink, A. Mulatu, E. Bulte

Research output: Contribution to journalArticle

147 Citations (Scopus)

Abstract

The environmental Kuznets curve assumes an inverted U-shaped relation between environmental damage and per capita income. Recently it has been argued in the literature that in addition to income levels, the inequality in the distribution of power and income is (positively) related to environmental degradation. We provide an additional argument, based on simple aggregation, for including a measure of income dispersion in empirical analyses. When the relationship between environmental damage and household income is concave (e.g. resembles an environmental Kuznets curve), then income inequality is negatively related to total environmental damage. Results from an empirical analysis of cross-national variation indicate that the aggregation effect can run counter to and outweigh the political economy effect for some environmental indicators.

Original languageEnglish
Pages (from-to)359-367
Number of pages9
JournalEcological Economics
Volume38
Issue number3
DOIs
Publication statusPublished - 1 Oct 2001
Externally publishedYes

Keywords

  • Environmental Kuznets curve
  • Households
  • Income inequality

ASJC Scopus subject areas

  • Ecology, Evolution, Behavior and Systematics
  • Economics and Econometrics
  • Ecology

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