Impact of Income Inequality on Urban Air Quality: A Game Theoretical and Empirical Study in China.

Feng Wang,Jian Yang,Xin Liu,Joshua Shackman

doi:10.3390/ijerph18168546

Abstract

Income inequality and environmental pollution are of great concern in China. It is important to better understand whether the narrowing of income inequality and environmental improvement contradict each other. The study aims to investigate the linkage between income inequality and environmental pollution. To illustrate the interplay between different income groups on environmental issues, we apply a mixed-strategy game. Based on the game-theoretic analytical result, the probability of residents supporting clean energy and environmental protection decreases as income inequality widens and increases as inequality narrows. This empirical study is based on the proportion of coal consumption and urban air pollution data from 113 key environmental protection cities and regions in China. The air quality data are from the National Environmental Air Quality Monitoring Network published in the China Statistical Yearbook from 2014–2018. Convincing results show that regions with higher income inequality suffer severe smog and related pollution and that economies with narrow income disparity experience significant improvements in smog and pollution control, with the expansion of the proportion of clean energy use. The results also provide no evidence of the impact of per capita income on pollution. We studied the relationship between individuals of different wealth levels within an economy, within a repeated-game setting. The finding suggests that the distribution of growth impacts pollution. Imposing higher taxes on air polluters while transferring the revenue to the lower-income group is suggested.

Highlights

In addition to the debate over the balance between economic growth and environmental protection, scholars have begun to discuss the role of economic inequality, which measures how unevenly income is distributed throughout a society
The individual fixed effect ui in the empirical model shown in Equation (1) represents factors affecting urban air quality that cannot be observed, such as atmospheric circulation and environmental capacity, which are constant in the time dimension
Income inequality aggravates air pollution measured by annual average PM2.5 concentration, both from ground monitoring and satellite observations

Summary

Introduction

In addition to the debate over the balance between economic growth and environmental protection, scholars have begun to discuss the role of economic inequality, which measures how unevenly income is distributed throughout a society. China has experienced rapid economic growth over the last two decades [1] that has caused crisis levels of inequality and pollution. Air pollution is at levels that harm human health in most of China’s cities. Of the 338 cities monitored by China’s Ministry of Environmental Protection in 2015, 73 cities fulfilled national standards for air quality [6], which refers to the air pollution level in these cities. We mainly focus on the linkage between income inequality and urban air quality in China. We want to clarify how the increasing

Methods

Results

Conclusion