Abstract
Research background: Intensive economic growth in Russian regions during recent decades has been associated with numerous environmental issues, particularly increasing CO2 emissions, as well as income inequality. To achieve sustainable development, it is necessary to resolve these issues.
 Purpose of the article: To shed light on the impact of income inequality on CO2 emissions based on Russian regional data covering the years 2004?2018.
 Methods: Gini index and decile dispersion ratio are used to measure income inequality. To study the impact of income inequality on CO2 emissions in the Russian regions, we estimate econometric models with fixed and random effects and apply GMM method. We test the hypothesis of the environmental Kuznets curve to determine the impact of economic growth on CO2 emissions.
 Findings & value added: The results show that CO2 emissions increase in tandem with growth in income inequality between 10% of people with the lowest income and 10% of people with the highest income. Simultaneously, CO2 emissions decrease with growth of Gini coefficient. The hypothesis of the Environmental Kuznets Curve was confirmed based on GMM method. Our findings underscore that the activities of the extraction and manufacturing sectors, as well as energy consumption, increase CO2 emissions. The chief significance of this paper is the finding that large income gap between extremely rich and extremely poor population cohorts increases CO2 emissions. This implies that economic policy aimed at reducing income inequality in Russian regions will also reduce CO2 emissions, especially if accompanied by increased use of environmentally friendly technologies. From the international perspective, our research can be extended to study other countries and regions.
Highlights
Climate change and greenhouse gas emissions have been increasingly recognized as urgent economic and political issues
Socio-economic development is premised on sustainable economic growth, and income inequality is another urgent problem related to economic growth and technological progress
Our research focuses on the impact of income inequality on CO2 emissions, and provides a background for economic policy aimed at decreasing such emissions
Summary
Climate change and greenhouse gas emissions have been increasingly recognized as urgent economic and political issues. Burning fossil fuels and deforestation for industrial and household utilization result in increasing the volumes of CO2 emissions These issues have long attracted the attention of the international community. The role of income inequality in CO2 emissions has received much less attention in the research on Russia, on the regional level (Vornobytsky & Boyce, 2010) and country level (Aye, 2020; Burakov & Bass, 2019). Our paper covers this gap in the literature and explores the relationships between income inequality and CO2 emissions, based on the Russian regional data covering the years 2004–2018
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