Poverty Offsetting

Abstract

The market now offers consumers an expanding array of options to offset the harms of their consumption. Travel websites and politicians alike sell the advantages of carbon offsetting. But offsetting options need not be limited to correcting for environmental harm; consumption is also associated with worker exploitation and people struggling with poverty. Individuals can and do respond to such poverty-related harms by altering their consumption decisions and by making voluntary supplemental payments following consumption. This Essay explores the possibility of poverty offsetting. Building upon carbon offsetting’s basic insight — that people should correct for the negative externalities of their consumption — poverty-offsetting institutions would enable individuals to correct for the poverty-related harms associated with their consumption.

Keywords: Offsetting, Consumption, Poverty, Carbon Offsetting, Charity

JEL Classification: D62, D63, I30, D11, D18, D43, K00