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Oxford Economic Papers 2000; 52:651-669
Copyright © 2000 Oxford Universty Press


Article

Carbon emissions and income inequality

M Ravallionz, M Heily and J Jalanw

z World Bank, 1818 H Street NW, Washington DC 20433, USA
E-mail: mravallion@worldbank.org
y US Environmental Protection Agency
w Indian Statistical Institute, New Delhi, India

Abstract

We find that the distribution of income matters to aggregate carbon dioxide emissions and hence global warming. Higher inequality, both between and within countries is associated with lower carbon emissions at given average incomes. We also confirm that economic growth generally comes with higher emissions. Thus our results suggest that trade-offs exist between climate control (on the one hand) and both social equity and economic growth (on the other). However, economic growth improves the trade off with equity, and lower inequality improves the trade off with growth. By combining growth with equity, more pro-poor growth processes yield better longer-term trajectories of carbon emissions.


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