Distance to Hazard: an Environmental Policy with Income Heterogeneity

Minoru Nakada

MPRA Paper from University Library of Munich, Germany

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.

Keywords: Environmental Taxation; Majority Voting; Residential Choices; Income Heterogeneity (search for similar items in EconPapers)
JEL-codes: D72 H23 Q52 R11 (search for similar items in EconPapers)
Date: 2016-07
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https://mpra.ub.uni-muenchen.de/120378/1/MPRA_paper_120378.pdf original version (application/pdf)

Related works:
Journal Article: Distance to hazard: an environmental policy with income heterogeneity (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:120378

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