Benito Ostolaza, Juan Miguel

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https://academica-e.unavarra.es/handle/2454/48704

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Benito Ostolaza

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Juan Miguel

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Economía

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INARBE. Institute for Advanced Research in Business and Economics

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0000-0002-6971-9086

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88625

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3240

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Author: Ezcurra Orayen, Roberto × Subject: Environmental degradation ×

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    PublicationOpen Access
    Do wealth levels affect the contribution to negative externalities?
    (Elsevier, 2020) Benito Ostolaza, Juan Miguel; Ezcurra Orayen, Roberto; Osés Eraso, Nuria; Ekonomia; Institute for Advanced Research in Business and Economics - INARBE; Economía
    This paper experimentally explores the link between poverty and decisions that lead environmental degradation. In the experiment, individuals with different wealth levels play a game that describes environmental degradation as a contribution to an activity that generates a negative externality. The experimental data show that wealth levels not related to the environment (exogenous poverty) play no significant role in environmental decisions. However, the variation in wealth as a consequence of the contribution to environmental degradation (endogenous poverty) affects the behavior of individuals, that enter a spiral of poverty and environmental degradation. These results suggest the existence of a poverty-environment trap.