The Equity-Efficiency Trade-Off in Environmental Policy: Evidence from Stated Preferences

Land Economics, Vol. 86, No. 3, 423-443, 2010

47 Pages Posted: 6 Feb 2009 Last revised: 11 Jul 2012

See all articles by Simon Dietz

Simon Dietz

London School of Economics - Grantham Research Institute on Climate Change and the Environment and Department of Geography and Environment

Giles Atkinson

London School of Economics and Political Science (LSE) - Department of Geography and Environment

Date Written: August 1, 2010

Abstract

The design of environmental policy raises several equity issues, in particular the distribution of benefits and costs. At the same time, it has often been argued that there is a trade-off in environmental policy between equity and efficiency, which brings these issues firmly to the attention of environmental economics. In this paper we use a simple choice experiment to elicit individual preferences over equity-efficiency trade-offs in the context of two environmental problems, local air pollution and global climate change. We find that equity matters to people as much as efficiency does in the design and delivery of environmental policy.

Keywords: Air pollution, allocative efficiency, climate change, choice experiment, environmental equity, polluter-pays principle

JEL Classification: D63, Q52

Suggested Citation

Dietz, Simon and Atkinson, Giles, The Equity-Efficiency Trade-Off in Environmental Policy: Evidence from Stated Preferences (August 1, 2010). Land Economics, Vol. 86, No. 3, 423-443, 2010, Available at SSRN: https://ssrn.com/abstract=1338176 or http://dx.doi.org/10.2139/ssrn.1338176

Simon Dietz (Contact Author)

London School of Economics - Grantham Research Institute on Climate Change and the Environment and Department of Geography and Environment ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

HOME PAGE: http://personal.lse.ac.uk/dietzs

Giles Atkinson

London School of Economics and Political Science (LSE) - Department of Geography and Environment ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

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