Environmental and Resource Economics

, Volume 7, Issue 1, pp 45-55

First online:

Is the income elasticity of environmental improvements less than one?

  • Bengt KristromAffiliated withDepartment of Forest Economics, SLU
  • , Pere RieraAffiliated withUniversitat Autonoma de Barcelona

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We estimated the income elasticity of environmental improvements for a number of European data-sets. The value of this parameter is consistently found to be less than one, with few exceptions. Our findings are compared with state-of-the-art contingent valuation studies from other countries. We also compared our findings with those reported in the literature on charitable donations and corporate donations. These studies show a similar pattern; donations decrease as a percentage of income, as income increases.

Key words

Distributional issues environmental elitism income elasticity valuation