Environmental Justice: Establishing Causal Relationships

Abstract

The environmental justice literature has found that the poor and people of color are disproportionately exposed to pollution. This literature has sparked a broad activist movement and several policy reforms in the United States and internationally. In this article, we review the literature documenting correlations between pollution and demographics and the history of the related movement, focusing on the United States. We then turn to the potential causal mechanisms behind the observed correlations. Given its focus on causal econometric models, we argue that economics has a comparative advantage in evaluating these mechanisms. We consider ( a) profit-maximizing decisions by firms, ( b) Tiebout-like utility-maximizing decisions by households in the presence of income disparities, ( c) Coasean negotiations between both sides, ( d) political economy explanations and governmental failures, and ( e) intergenerational transmission of poverty. Proper identification of the causal mechanisms underlying observed disproportionate exposures is critical to the design of effective policy to remedy them.

Perceived Pollution and Residential Sorting in Germany: Income May Not Sort, But it Helps to Escape

“…Besides selective sorting, environmental inequality can also result from selective siting of disamenities (Banzhaf et al, 2019;Depro, Timmins, & O'Neil, 2015;Hamilton, 1995;Mohai & Saha, 2015;Pastor, Sadd, & Hipp, 2001). Selective siting assumes that polluting facilities are located disproportionately close to minorities or economically disadvantaged residents, thus hypothesising an opposite temporal order than selective migration.…”

“…In general, studies using spatially aggregated longitudinal data to analyse selective migration processes based on income report mixed results (for a complete overview see e.g. Banzhaf et al, 2019;Mohai & Saha, 2015). For instance, Banzhaf and Walsh (2008) find some support for lower income trajectories in areas which previously received a Toxics Release Inventory (TRI) facility, and Gamper-Rabindran and Timmins (2011) find an increase in average income after the clean-up of hazardous waste sites.…”

“…When explaining the pollution disadvantage of minority residents, scholars often refer to similar mechanisms as outlined above, thus arguing that majority households are more likely than minority households to leave polluted areas and more likely to end up in clean areas (Banzhaf et al, 2019;Mohai & Saha, 2015). This is often explained by the racial income-inequality thesis.…”

“…Accordingly, previous studies in the United States (e.g. Ard, 2015;Ash & Boyce, 2018;Banzhaf, Ma, & Timmins, 2019;Crowder & Downey, 2010;Mohai & Saha, 2015) and in Europe (e.g. Diekmann & Meyer, 2010;Glatter-Götz, Mohai, Haas, & Plutzar, 2019;Pasetto, Mattioli, & Marsili, 2019;Rüttenauer, 2018) have documented the unequal distribution of environmental hazards across different social groups.…”

“…However, findings on the causal process explaining the high exposure of disadvantaged groups remain inconclusive so far (for an overview see e.g. Banzhaf et al, 2019). While some studies find support for the thesis that minorities and poor households selectively sort into more polluted areas, others show no evidence for selective migration processes.…”