Working Paper: NBER ID: w25666
Authors: Erin T. Mansur; Glenn Sheriff
Abstract: We compare the spatial distribution of emissions from Southern California’s pollution-trading program with that of a counterfactual command-and-control policy. We develop a normatively significant metric with which to rank the various distributions in a manner consistent with an explicit well-behaved preference structure. Results suggest trading benefited all demographic groups and generated a more equitable overall distribution of emissions even after controlling for its lower aggregate emissions. Upper-income and white demographics had more desirable distributions relative to low-income and some minority groups under the RECLAIM trading program, however, and population shifts over time may have undermined anticipated gains for African Americans.
Keywords: air pollution; environmental justice; environmental markets; distributional analysis; inequality; regulation
JEL Codes: D63; Q52; Q53
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| emissions trading under California's RECLAIM program (Q52) | equitable distribution of emissions overall (D63) |
| RECLAIM program (R52) | reduced average exposure levels for all groups (I14) |
| lower aggregate emissions (Q52) | more favorable distributions for upper-income and white demographics (D39) |
| shifts in population dynamics over time (J11) | diminished benefits for African Americans (J78) |
| gains for one demographic group (J79) | no expense for another demographic group (J79) |