Where is Pollution Moving? Environmental Markets and Environmental Justice

10 Pages Posted: 27 Jan 2021 Last revised: 28 Jul 2021

See all articles by Joseph S. Shapiro

Joseph S. Shapiro

University of California, Berkeley; National Bureau of Economic Research (NBER)

Reed Walker

University of California, Berkeley - Haas School of Business

Date Written: January 2021

Abstract

Do US air pollution offset markets disproportionately relocate pollution to or from low-income or minority communities? Concerns about an equal distribution of environmental quality across communities—environmental justice—have growing policy influence. We relate prices and quantities of offset transactions to demographics of the communities surrounding polluting plants. We find little association of offset prices or offset-induced movements in pollution with the share of a community that is Black, Hispanic, or with mean household income. This analysis of twelve prominent offset markets suggests that they do not substantially increase or decrease the equity of environmental outcomes.

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Suggested Citation

Shapiro, Joseph S. and Walker, Reed, Where is Pollution Moving? Environmental Markets and Environmental Justice (January 2021). NBER Working Paper No. w28389, Available at SSRN: https://ssrn.com/abstract=3772636

Joseph S. Shapiro (Contact Author)

University of California, Berkeley ( email )

HOME PAGE: http://joseph-s-shapiro.com

National Bureau of Economic Research (NBER) ( email )

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Reed Walker

University of California, Berkeley - Haas School of Business ( email )

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2220 Piedmont Avenue
Berkeley, CA 94720
United States

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