Consumption Pattern, Income Distribution and the Environment in Brazil

Abstract

To analyze the environmental pattern of urban consumption in Brazil, we have estimated household degradation level (E) for ten income classes calculated by the product of its propensity to degrade to the average household income. In turn, propensity to degrade (Pmg) is estimated as the propensity to consume weighted by the pollution or natural resource use intensity of each consumption item. Note that Pmg will be related to the cross effect of the pollution intensity, a technological factor, and income elasticity of demand captured by the propensity to consume that, in turn, is an income composition factor. Total degradation E, on the other hand, will also capture income scale effects since it will be also dependent on income levels. Our results show that income scale effects always exceed any demand and technological effects for the 1995 urban consumption level in Brazil.

Keywords: environment, consumption pattern, inequality

JEL Classification: Q210