Many effects of environmental and energy policy are likely to
disproportionately burden those with low income. First, it raises
the price of fossil-fuel-intensive products that constitute a high
fraction of low-income budgets (like gasoline, heating fuel and
electricity). Second, the handout of pollution permits to firms
provides value to those who own them. Third, low-income individuals
may place more value on food and shelter than on improvements in
environmental quality, so high-income individuals may get the most
benefit of pollution abatement. Fourth, air quality improvements
may raise the value of houses owned by landlords, rather than
helping renters. These effects might all hurt the poor more than
the rich. This book brings together the seminal economics
literature that studies whether these fears are valid and whether
anything can be done about them.
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