A Random Utility Model of Environmental Equity

Posted: 16 Jan 2001

See all articles by Diane Hite

Diane Hite

Auburn University - Department of Agricultural Economics and Rural Sociology

Abstract

Past attempts to uncover evidence that economically disadvantaged groups are unjustly exposed to environmental disamenities have failed to take into account self-selection behavior of individuals or groups of individuals. For instance, when choosing a place to live, households may be trading environmental quality for other housing, neighborhood, and location characteristics they care about. Previous literature on environmental justice has investigated location choice of polluting industries, but fails to account for consumer self-selection in housing markets. This paper thus focuses on location choice of individuals based on observed housing transactions. From the results of a random utility model, a test is proposed that incorporates the no-envy concept of economic equity. The results support a finding for environmental discrimination with respect to African American households, but do not support the hypothesis that poor households in general are unfairly exposed to environmental disamenities.

Suggested Citation

Hite, Diane, A Random Utility Model of Environmental Equity. Available at SSRN: https://ssrn.com/abstract=247456

Diane Hite (Contact Author)

Auburn University - Department of Agricultural Economics and Rural Sociology ( email )

Comer Hall
Auburn, AL 36849
United States
334-844-5655 (Phone)
334-844-5639 (Fax)

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