Global Environmental Policy Seminar
 

Income, Wealth, and Environmental Inequality in the United States

This paper explores the relationships between air pollution, income, wealth, and race by combining administrative data from U.S. tax returns between 1979–2016, various measures of air pollution, and sociodemographic information from linked survey and administrative data. In the first year of our data, the relationship between income and ambient pollution levels nationally is approximately zero for both non-Hispanic White and Black individuals. However, at every single percentile of the national income distribution, Black individuals are exposed to, on average, higher levels of pollution than White individuals. By 2016, the relationship between income and air pollution had steepened, primarily for Black individuals, driven by changes in where rich and poor Black individuals live. We utilize quasi-random shocks to income to examine the causal effect of changes in income and wealth on pollution exposure over a five year horizon, finding that these income–pollution elasticities map closely to the values implied by our descriptive patterns. We calculate that Black-White differences in income can explain ∼10percent of the observed gap in air pollution levels in 2016.

Biography

Jonathan Colmer is an Associate Professor of Economics and Public Policy in the Department of Economics at the University of Virginia, and the Co-Founder and Director of the Environmental Inequality Lab. Jonathan is an environmental economist, who also works in the area of growth and development economics. His research combines data with insights from economic theory and environmental science to better understand how economic activity and the environment influence one another.