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Fair Air: Distributive Justice and Environmental Economics

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Abstract

Are fairness concerns of relevance to environmental economics and, if so, are they sufficiently structured to improve analysis in this field? On both of these questions, we answer in the affirmative, arguing that people’s fairness views are based on both general rules and the context, where context refers to the set of variables and persons employed to interpret and apply the principles. The fairness rules analyzed are accountability (i.e., rewards that are proportional to contributions individuals control), efficiency, need and equality. We conclude that stakeholders typically exhibit a “fairness bias”, i.e., they tend, consciously or not, to interpret and apply fairness principles in a self-serving manner, whereas the views of spectators, or impartial third parties, tend to converge significantly more. Further, we argue that fairness considerations are relevant to both descriptive and prescriptive analysis in environmental economics. These fairness concerns are reflected in the behavior of private and public decision-makers and have potentially important policy implications through the overall social objective function.

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Authors and Affiliations

  1. Department of Economics, University of Gothenburg, Box 640, 40530, Gothenburg, Sweden

    Olof Johansson-Stenman

  2. Department of Economics, Loyola Marymount University, One LMU Drive, Suite 4200, Los Angeles, CA, 90045-2659, USA

    James Konow

  3. Erik Malmsten Guest Professor, Department of Economics, University of Gothenburg, Box 640, 40530, Gothenburg, Sweden

    James Konow

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  1. Olof Johansson-Stenman
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Correspondence to Olof Johansson-Stenman.

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Johansson-Stenman, O., Konow, J. Fair Air: Distributive Justice and Environmental Economics. Environ Resource Econ 46, 147–166 (2010). https://doi.org/10.1007/s10640-010-9356-7

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