Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/163521 
Title: 

Income inequality and the international transfer of environmental values

The document was removed on behalf of the author(s)/ the editor(s).

Year of Publication: 
2017
Series/Report no.: 
Economics Working Paper No. 2017-03
Version Description: 
July 24, 2017
Publisher: 
Kiel University, Department of Economics, Kiel
Abstract: 
How the valuation of environmental goods is related to income is a key question for environmental economics, but the role of income inequality is often neglected. We study how income inequality affects the international transfer of the valuation of environmental goods - a practice called value or benefit transfer. Specifically, we apply theory-driven transfer factors to examine whether adjusting for income inequality can reduce errors made in benefit transfer, drawing on a multi-country valuation study on water quality improvement. Our convergent validity analysis shows that income inequality adjustment reduces benefit transfer errors by more than 1.5 percentage points on average across all transfers. The adjustment for inequality is particularly important when income is distributed more unequally at the policy site relative to the study site, yielding reductions in transfer errors of up to 33 percentage points. Our results are relevant for policy appraisal, environmental accounting, and more generally for the role of income inequality in non-market valuation.
Subjects: 
benefit transfer
convergent validity
income
inequality
stated preferences
transfer errors
JEL: 
Q51
D63
H43
Q53
Q25
Document Type: 
Working Paper

Files in This Item:
The document was removed on behalf of the author(s)/ the editor(s) on: August 3, 2018


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