Environmental and Natural Resources Economics

Seminar Paper

Environmental Justice: Income, Race, and Health

Table of Contents

Introduction..3
Pollution and Health..4
Pollution, Poverty and Race...6
The Year of Air 2013...8
International Dimensions of Environmental Justice...9
International Trade in Toxics...11
Electronics Waste12
Equalize the burden or eliminate pollution?......................................................................14
Pollution in Bosnia and Herzegovina ....15
Conclusion...17
Key Terms19
Sources.21

Introduction

Despite significant improvements in environmental protection over the past several

decades, over 1.3 billion individuals worldwide live in unsafe and unhealthy physical
environments. Hazardous waste generation and international movement of hazardous waste and
toxic products pose some important health, environmental, legal, political, and ethical dilemmas.
This paper examines the relationship between community-level exposure to air toxics and
socioeconomic, political, and demographic characteristics of the population. We also explore
questions related to the distribution of pollution and other forms of environmental degradation.
Our discussion is centered on environmental justice: the recognition that minority and lowincome communities often bear a disproportionate share of environmental costs and the
perception that this is unjust.
In some ways, toxic wastes even could be shipped to low-income nations where
regulations governing toxics are weak or nonexistent. Environmental contaminants may also be
carried long distances, affecting communities far from their origin. Some might argue that this is
just the way the market works, since richer communities or nations can afford better
environmental protection.
How are the health consequences of environmental degradation distributed among
communities and ethnic groups? Is environmental protection a priority only for the wealthy, and
an irrelevant luxury for the poor? We explore these and other questions in the sections below. We
also look at some of the solutions that communities have developed as they work toward greater
equity in the distribution of environmental benefits and costs.

Pollution and Health

Air pollution can affect our health in many ways with both short-term and long-term
effects. Different groups of individuals are affected by pollution in different ways. Some
individuals are much more sensitive to pollutants than are others. Young children and elderly
people often suffer more from the effects of air pollution. People with health problems such as
asthma, heart and lung disease may also suffer more when the air is polluted. The extent to which
an individual is harmed by air pollution usually depends on the total exposure to the damaging
chemicals, i.e., the duration of exposure and the concentration of the chemicals must be taken
into account.
Examples of short-term effects include irritation to the eyes, nose and throat, and upper
respiratory infections such as bronchitis and pneumonia. Other symptoms can include headaches,
nausea, and allergic reactions. Short-term air pollution can aggravate the medical conditions of
individuals with asthma and emphysema. In the great "Smog Disaster" in London in 1952, four
thousand people died in a few days due to the high concentrations of pollution.
Long-term health effects can include chronic respiratory disease, lung cancer, heart
disease, and even damage to the brain, nerves, liver, or kidneys. Continual exposure to air
pollution affects the lungs of growing children and may aggravate or complicate medical
conditions in the elderly. It is estimated that half a million people die prematurely every year in
the United States as a result of smoking cigarettes.
Research into the health effects of air pollution is ongoing. Medical conditions arising
from air pollution can be very expensive. Healthcare costs, lost productivity in the workplace,
and human welfare impacts cost billions of dollars each year.
People with low incomes and inadequate access to health care may also be
disproportionately exposed to environmental contamination that threatens their health. In this
section, we look at the health effects of toxic chemical exposures, and the unequal distribution of
these effects in society.
Rates of certain illnesses and disorders have risen steadily in recent decades. Some
cancers, including breast cancer, children's leukemia, and children's cancers of the brain and
nervous system, have risen significantly since World War II. Children's cancer rates have risen
substantially over the past quarter century. From 1975 to 2000, cancer incidence increased 31.7%
nationwide in children under the age of 15, or 29.6% in children under the age of 20. (See Figure
1.)

This increase in cancer incidence has occurred during a period characterized by the rising
use of a wide range of industrial chemicals. Many scientists believe that the rising use of these
chemicals is at least partly responsible for rising rates of cancer and certain other chronic
diseases. 1
Studies have established links between childhood cancer and environmental factors
including exposure to solvents, pesticides, and air pollution. A recent review of many existing
studies found that parental and childhood exposure to pesticides and solvents are consistently
linked to some cancers; even prenatal exposures can be linked to some childhood cancers. The
review also found a particularly strong link between toxic exposures and leukemia, brain, and
central nervous system cancers, which account for about half of all children's cancers.
Asthma rates have also risen dramatically, to the point that asthma is now considered an
epidemic among children in the U.S. Rates of certain neurobehavioral disorders and learning
disabilities have also increased dramatically; for example, the disorder known as autism, in
which individuals are unable to engage in normal interpersonal interactions, has shot upward in
1 Gouveia-Vigeant, Tami and Joel Tickner (2003), Toxic Chemicals and Childhood Cancer: a Review ofthe
Evidence (Lowell, MA: Lowell Center for Sustainable Production).

recent decades. Some of these disorders have a genetic component, but genetic patterns in human
populations cannot change over the course of one or two generations. Thus, when rates of a
disease increase dramatically over a couple of generations, it is necessary to look into social and
environmental factors for the explanation.

Pollution, Poverty and Race

Distribution of diseases and disabilities that have an environmental component is
unequally distributed across race and income levels. For example, asthma prevalence in the U.S.
is significantly higher in minority and low-income populations than in the general population.
Compounding this problem, minorities often receive lower quality health care, and may be
forced to rely more on emergency room visits, rather than routine doctor visits. Across the United
States, poor and minority neighborhoods bear an unequal burden from hazardous facilities and
waste sites. This pattern is evident nationally as well as on the state and local level. Pollution is
unequally distributed across the country; it is also distributed unequally within individual states,
within counties, and within cities.

A 1987 study of toxic waste and race, conducted by the New York-based Commission for
Racial Justice, also found a strong link between race and location of hazardous waste facilities.
This study found that of 27 hazardous-waste landfills nationwide, a third -- representing almost
60 percent of total hazardous waste landfill capacity -- was located in five southern states:
Alabama, Louisiana, Oklahoma, South Carolina, and Texas. Of these, three of the largest sites
were located in primarily black zip codes, and these three accounted for about 40 percent of the
total estimated hazardous-waste landfill capacity in the entire United States.
More recent studies have found similar results. For example, a study of the distribution of
hazardous sites and polluting facilities around Massachusetts found that communities of color
and working-class communities are home to significantly more hazardous sites and facilities than
wealthier communities and those with a small minority population. Low-income and minority
populations are also more likely to live in areas where high lead exposure is likely, due either to
2 National Cancer Institute, SEER Cancer Statistics Review, 1975-2000.Available at
http://www.seer.cancer.gov/csr/1975_2000/results_merged/sect_27_childhood_cancer.pdf,

3 Robert D. Bullard (1990), Dumping in Dixie: Race, Class, and Environmental Quality.

soil contamination or to lead paint. The Researchers looked at the distribution of hazardous waste
sites, landfills and transfer stations, polluting industrial facilities, power plants, and incinerators;
they also created a measure of exposure to cumulative environmental hazards, looking at all the
exposure sources together. They found that "high-minority communities face a cumulative
exposure rate to environmentally hazardous facilities and sites that is nearly nine times greater
than that for low-minority communities." Cumulative exposure in low-income communities is
about three to four times higher than in other communities in Massachusetts.
Another recent study looked at distribution of toxic air pollutants in southern California.
The researchers found strong links between race or ethnicity and exposure to toxic air pollutants.
Everyone was found to face an elevated cancer risk due to toxic air pollutants, but almost 1/3 of
the minority population of southern California was located in the areas with the highest cancer
risk, whereas 15% of the white population lived in such areas. The researchers also looked at
local environmental conditions in the vicinity of Los Angeles public schools. They found that
minority children suffered the most exposure to air pollution at school. At schools ranked in the
bottom fifth for air quality, the children were 92% minority. The researchers also found a
relationship between respiratory risks associated with air pollution and decreased achievement in
school. Even when they controlled for the range of predictors usually associated with school
achievement, such as income level and parents academic background, the researchers found a
link between higher air pollution and lower achievement in school.4
Environmental protests remembered in Warren County exhibit
Warrenton, N.C. It's been three decades since a controversial decision by the state of
North Carolina to dump soil laced with cancer-causing chemicals on land in Warren
County.
The move prompted weeks of demonstrations and more than 500 arrests. The history of
the issue dates to 1978, when a manufacturer of electrical transformers illegally dumped
polychlorinated biphenyls, or PCBs, that were used in coolant along the sides of 240
miles of North Carolina highways.
By 1982, the state decided it was going to dig up the contaminated soil and move it to a
landfill in Warren County. That prompted outrage from homeowners and environmental
activists who were concerned about how PCBS might contaminate the water supply.
Weeks of civil obedience and protests followed.
4 Faber and Krieg (2002), Unequal Exposure to Ecological Hazards: Environmental Injustices in
theCommonwealth
Massachusetts.
Almena
Mayes of
was
16 years old and in high school at the time: "When they were talking

about how the toxic waste was going to affect our future, I was a part of that future," she

Kicking off the year of Air 2013

Clean air will be the focus of EU environmental policy discussions throughout 2013, the
Year of Air. The European Environment Agency (EEA) provides a wealth of information
underpinning the review of air pollutant legislation.
Air pollution remains a concern for public health and the environment, according to the
most recent analyses published by the EEA. To improve the situation, the European Commission
is reviewing the EU Thematic Strategy on Air Pollution and related policies in 2013. A related
consultation on options for the revision started already in 2012 and will be concluded by early
March.
The air quality problem in Europe
Europe has made progress in tackling emissions of some air pollutants. For example,
sculpture dioxide emissions have been reduced significantly in recent years thanks to EU
legislation requiring the use of emissions scrubbing technology and lower sculpture content in
fuels.
However, a large proportion of the population is still exposed to excessive concentrations
of certain air pollutants, leading to health risks and premature death in some areas. The most
problematic pollutant for health is particulate matter, which has only decreased slightly over the
last decade.
The latest science also shows that some environmental impacts of air pollution, such as
acidification and eutrophication, are more serious than anticipated. Among others, this is because
newer scientific methods are showing that ecosystems are more sensitive than previously judged.
While legislation has led to improvements in many cases, real world emissions of passenger cars
and light commercial vehicles can still substantially exceed emission limits.
Competition winners receive award
In 2012, the EEA organised a photo story competition ImaginAir, inviting Europeans to
tell their story of air in Europe in four thematic categories: air and health, air and nature, air and

cities, air and technology. In addition to these four categories, the competition awarded special
prizes for youth and the publics choice. The winners were presented with their prizes today,
showing inspirational approaches to picturing the air where they live, and an admittedly
challenging endeavor.
International Dimensions of Environmental Justice
In the same way that poor communities are often forced to tolerate an unbalanced trouble
of pollution and environmental deprivation in comparison to richer communities within the same
nation or state, poor countries may often forced to tolerate toxic wastes that are exported from
wealthier countries. Deprived nations may also stand an unequal burden from global warming
and other human-caused changes that affect the whole world. Global warming is an example of
problems both of environmental externalities and of justice issues on a worldwide degree. The
"greenhouse effect" is a process in which gases such as carbon dioxide increase in the earth's
atmosphere and entrap energy from the sun. Factories, automobiles, airplanes, and other
foundations of industrialized life raise the levels of carbon dioxide and other greenhouse gases
into the atmosphere. Through the greenhouse effect, these gases add to global warming.5
The Intergovernmental Panel on Climate Change (IPCC), an international body of
scientists, has formed a series of circumstances from which predictions can be made about
probable changes linked with global warming. Likely changes include greater temperatures in
many parts of the planet, bigger chances of droughts and flooding, increased occurrence and
harshness of storms, and growing sea level. International discussions are under way to assign
responsibility for getting global warming restrained before it is too late. In these discussions, the
U.S. and other developed countries have pressed to make certain that developing countries also
bear some of the burden of dropping global emissions of greenhouse gases. Simultaneously,
there is prevalent acknowledgment that the advantages and disadvantages s have not been fairly
distributed. Developed countries have enjoyed most of the rewards from quick industrial
development and extensive use of cars and other fuel-intensive forms of transportation.
Developing countries, in contrast, are forced to deal with the most severe consequences from
global warming.
5 25Lawrence Summers, World Bank, internal memo, December 12, 1991. Reproduced
at:http://www.sustainableworld.org.uk/summersmemo.htm.

For example, Bangladesh is a highly populated nation with about115 million people
living in an area of about 144,000 square kilometers. Bangladesh is located at the delta of three
major rivers, and is often exposed to severe flooding. Some experts have looked at the possible
effects of a one-meter sea level rise in Bangladesh. According to one study, if sea level rises by a
meter, over 11% of the population of Bangladesh (over 13 million people) would be forced to be
relocated; almost a fifth of the total land of the country would be entirely flooded; and distinctive
mangrove forests would be lost. Furthermore, more than a fifth of the country's monsoon rice
land would be covered with water; and coastal prawn production would become impracticable.
One potential option for fighting the effects of a sea-level rise of this level may be to
build barricades, to guard land areas in Bangladesh. This feat would only address this precise
problem of sea level rise, and would not deal with the further problem that global warming is
expected to increase the regularity and severity of cyclones and other destructive weather events.
The probable effects of global warming in Bangladesh represent the asymmetrical burden of
environmental troubles that result from some economic activities. The involvement of

10

Bangladesh itself to global warming is minimal; yet Bangladesh will have to put up with some of
the highest costs of increasing temperatures on earth.6

International Trade in Toxics

Nobody needs hazardous waste, but hazardous waste is traded internationally just like
sought-after goods, such as food and clothing. The majority of people believe that international
trade in hazardous waste puts an unjust burden on the countries that collect it. The opportunity to
send hazardous waste overseas also simplifies everything for companies in wealthy countries to
continue the production of waste, because they do not need to locate a place for it in their own
area. An international contract, the Basel Convention, was formed in 1989 to put restrictions on
international trade in toxic wastes. In 1994, participants of the Basel Convention settled on a
complete prohibition on exports of hazardous wastes from developed to less developed countries.
The 15 nations within the European Union have put into practice the Basel Convention and
prohibited the overseas selling of all hazardous wastes to developing countries completely. To
this day, the U.S. is the only developed nation that has not approved the Basel Convention.
Export of Toxins
In 2001, an investigation carried out by the Basel Action Network, a NGO, documented highly
dangerous procedure in one countryside area of China where electronic equipment is taken apart
to recover important components. Around 100,000 people work in the electronics recycling
operations of Guiyu, most of whom are women and children.
Electronic equipment is taken apart by hand using plain tools such as hammers and
screwdrivers. Minimal or no safety measures exist to shield workers from the lethal substances
contained in the equipment. For example, workers dismantling used toner cartridges use
paintbrushes and their uncovered hands to take out the left over toner; they breathe the toner dust
and it covers their clothes. Printer toners include a material known as carbon black, a possible
human carcinogen.
6 Summary for Policymakers: A Report of Working Group 1 of the IntergovernmentalPanel on Climate Change,
http://www.grida.no/climate/ipcc_tar/vol4/english/pdf/wg1spm.pdf

11

Other workers burn plastic-coated wires to retrieve the costly copper from them. The polyvinyl
chloride (PVC) coating of the wires, as well as brominated flame retardants in the wire
insulation, are likely to produce the highly toxic chemicals known as dioxins and furans when
they burn. Children and pregnant women live near the burning areas, and young children play in
the toxic remains. In close proximity there is a fishpond, which is probably contaminated by the
burning derivatives, yet is a chief supply of nutrition for the village. Glass from computer and
television monitors, which contains great amounts of lead, is thrown in rivers or on open land.
At the time of this study, electronic waste recycling had been occurring in Guiyu for the past
six years. For five of those years, drinking water has had to be delivered into the area, because all
the neighboring water springs are too polluted to drink.
The Problem of Electronics Waste
Computers and other electronic equipment have huge amounts of heavy metals and other
toxic materials. For instance, a classic cathode ray tube (CRT) computer monitor has three to
eight pounds of lead inside. Lead is harmful to the nervous system, blood, kidneys, and
reproductive systems, and causes permanent brain damage in children. Millions of pounds of
toxic electronic waste, or "E-waste," are produced each year within the U.S. alone, as we throw
out old computers, televisions, and other outdated tools.
With growing understanding about the dangers connected with these wastes, some
societies in the U.S. have made measure to guard themselves. Massachusetts and California, for
instance, have laws against throwing out cathode ray tube monitors, that is the monitors used for
most PCs and TV screens, in public landfills. However, when toxic electronic waste of this kind
is sidetracked from landfills in the U.S., it is commonly exported overseas. An estimated 50% to
80% of the televisions and computer monitors that U.S. consumers bring to recycling centers are
in fact exported to deprived areas in Asia.
Once in Asia, this electronic equipment is not recycled in the way we might imagine.
Some of the materials are recovered for further use, but the way the materials are extracted
causes terribly severe health effects for the people doing the work and for their families and
neighbors. In China, India, and Pakistan, electronics "recycling" is connected with dangerous
activities including open burning of plastics, which can produce extremely toxic results;

12

exposure to toxic solders; and dumping of acids in rivers. Many of the workers who are exposed
to these dangerous byproducts are children.
The case of trade in toxic e-waste exposes a paradox of the economic achievement of the
computer industry. Part of the huge enlargement in the computer and electronics industry has
been connected to fast obsolescence of equipment. Although electronic equipment was
previously considered a long-term investment; much of it is now designed to be disposed after a
few years. According to a 1999 report by the National Safety Council, the average life span of a
computer in the U.S. is now as low as two years. The flow of hazardous e-waste to Asia results
in part from low salaries in Asia and poorly imposed regulations to protect the health of workers.
Furthermore, it is legal in the U.S. to export dangerous waste, regardless of international laws to
the opposing. The problem of hazardous e-waste also results from the way in which these
products are designed. For the most part, electronics are not designed to smooth the progress of
recycling. So, the recycling that does take place is labor exhaustive and harmful, and many
materials are wasted because they cannot be recovered from the products. The solution to the
problem of hazardous e-waste lies at least partly in pursuing clean production. If electronic
equipment is designed to be easily and efficiently recycled, resources can be saved while
workers' health is protected. New legislation on electronics in the European Union makes
manufacturers responsible for eliminating some of the most toxic components of electronic
equipment, and creates incentives or requirements for manufacturers to create easily recycled
products.7

Equalize the burden or eliminate pollution?

There are two potential solutions to environmental justice problems: spread out pollution
extra equitably, or decrease the total weight of pollution. In general, community groups working
for environmental justice anxiety that their goal is the latter. In numerous instances, in fact,
groups working for environmental justice have achieved broader goals.
7 Puckett, Jim et al. Exporting Harm: The High-Tech Trashing of Asia (Seattle, WA: AsiaPacific Environmental
Exchange, February 2002).http://www.svtc.org/cleancc/pubs/technotrash.pdf.

13

For example, an environmental justice effort in San Diego, California led to broader
changes in management of toxic pesticides. 8 The Environmental Health Coalition (EHC) is a
community-based organization that works with for the most part minority, low-income
communities in San Diego. EHC undertook to end the use of the pesticide methyl bromide to
fumigate incoming produce in San Diego's harbor district. Methyl bromide is a reproductive
toxicant and an ozone depleting chemical, so it is significant both for local environmental health
and for the global environment. In the low-income neighborhoods near the port, residents
suffered health consequences -- including asthma, vision problems, and skin disorders -- from
exposure to a range of pollutants including methyl bromide. In 1997, EHC's campaign was
thriving and use of methyl bromide was discontinued; San Diego adopted the first policy in the
world prohibiting use of methyl bromide as a port fumigant. This successful campaign has served
as a model for environmental health campaigns in other port communities, and has encouraged
the creation of determined local projects for environmental protection and reclamation.
As we saw in the conversation of electronic waste, unequal distribution of environmental
harm can from time to time help to prolong serious problems at the nexus of economics and the
environment, by hiding those problems from the people who have power to make changes.
Solving environmental justice problems often implies solving underlying production
problems. In the case of e-waste, a production problem -- electronic equipment that is nearly
impossible to recycle safely -- leads to an environmental justice problem when poverty-stricken
workers destroy their health attempting to extract the valuable components of old computers.
Resolving this problem is not a simple matter of shifting recycling operations to more
privileged communities and introducing new rules for safe handling of old electronic equipment.
It is a matter of changing the way electronic goods are manufactured. In this and many other

8 Information in this paragraph is drawn from Daniel R. Faber and Deborah McCarthy, "Neoliberalism, Globalization and the Struggle for Ecological Democracy: Linking Sustainability
and Environmental
Justice." In Julian Agyeman et al., eds. (2003), Just Sustainabilities: Development in an
Unequal World,
pp. 38-63; information in this paragraph is from p. 52-53. 18

14

cases, when people work to redress environmental injustices, they repair other problems in the
economy in the process.
Disturbing the degree of air pollution in Sarajevo and Zenica
Heinrich Boell Foundation, the Office of BiH, together with its partners the Helsinki
Committee for Human Rights in Bosnia and Herzegovina and the Centre for Ecology and Energy
Tuzla implemented a project funded by the European Union, called "Partnership for Greater
Environmental Standards in BiH".
The goal of this project is to promote and strengthen the third generation of human rights
in Bosnia and Herzegovina, the right to a healthy life and environment through strengthening
civil society organizations and their activities in order to become familiarized with the European
standards in environmental protection.
A particular focus of the project is aimed at increasing the awareness of the citizens of
Bosnia and Herzegovina on environmental rights, and improve monitoring mechanisms and early
warning systems to prevent the impairment of the right to a healthy life and environment.
In March and April 2012, The Helsinki Committee for Human Rights in BiH, in
cooperation with the Heinrich Bll Foundation, and in part of the above-mentioned project,
conducted research into the application of environmental law in Sarajevo and Zenica. Studies
have included field visits, focused on the worst cases of deprivation of environmental law.
The results of the field visits to the Sarajevo area are disturbing, and the issue of air
pollution in Sarajevo no suitable treatment or in the legislative, not the executive, nor the general
public. During the previous winter, Sarajevo was repeatedly declared the most polluted city in
Europe.
The register data of emissions into the air, with an overview of sources of pollution in the
Sarajevo Canton, confirm these results.
The biggest polluters are the old motor vehicles and the type of fuel used, as well as
individual furnaces that use low-grade coal. Because these pollutants are usually increased value
of sulfur dioxide (furnaces) and particulate matter PM 10/dima (motor vehicles).

15

Thus, on January 22, 2012, the concentration of particulate matter PM 10 exceeded 500
micrograms per cubic meter, while sulfur dioxide emissions were about 130 micrograms.
It is necessary to raise public awareness of the Canton Sarajevo on environmental issues
and environmental rights, and simultaneously intensify cooperation between organizations and
institutions in Sarajevo Canton, primarily working bodies of the Commission for Health, Human
Rights and the Environment. Greater attention must be paid to the implementation of the adopted
laws, regulations and policy documents, and elected bodies responsible for monitoring the
implementation of these documents must frequently inform the public about these processes.
Zenica, the largest industrial city in Bosnia and Herzegovina, has a constant problem with
air pollution. In addition to the industry as a major air pollutant, air in Zenica is further polluted
by exhaust gases from motor vehicles and individual furnaces, especially in the winter.
It is not rare that in Zenica, the concentration of sulfur dioxide exceeded 500 micrograms
per cubic meter, which is considered as episodes of high air pollution, and a high level of alert.
As a consequence of this situation, according to the World Health Organization, there have
deleterious effects on human health, which is reflected in the respiratory system, lung function,
makes people more susceptible to infections and often leads to irritation of the eyes.
The most vulnerable population in the municipality of Zenica lives in local communities,
Tetovo Podbrijeje, Banlozi and Burgenland. In these four communities live 17,000 inhabitants,
most directly exposed to all the diseases that occur as a result of air pollution.
Such air pollution inevitably affects the quality of the soil in Zenica, which was also the
subject of the study on contaminated land (April 2010) that the request made by the Municipality
of Zenica Agropedological Institute Federation. Data from this study shows that there is a large
degree of accumulation of heavy metals in some herbaceous plants cultivated in the municipality
of Zenica.

16

These findings further brought unrest among citizens, especially these local communities,
which expected to help solve these problems by all competent authorities and bodies, as in the
Zenica-Doboj Canton and in the Federation.9

Conclusion
Environmental justice is the recognition that minority and low-income communities often
bear a disproportionate share of environmental costs and the perception that this is unjust.
Environmental quality, income levels, and access to health care can all affect peoples
health. People with low incomes and inadequate access to health care are often
disproportionately exposed to environmental contamination that threatens their health.
Environmental pollution is linked to a range of disabilities and chronic illnesses including
cancer, asthma, and certain learning disabilities. Rising rates of these problems affect everyone,
but in many cases, poor and minority communities are disproportionately affected.
Across the United States, poor and minority neighborhoods bear an unequal burden from
hazardous facilities and waste sites. Pollution is also distributed unequally within individual
states, within counties, and within cities.

Hazardous waste sites, municipal landfills,

incinerators, and other hazardous facilities are disproportionately located in poor and minority
neighborhoods.
A variety of economic concepts are relevant to the study of the interrelationship among
income, pollution, and health. For example, economists sometimes examine the relationship
between pollution and location through the study of hedonic pricing.
Hedonic pricing attempts to calculate the dollar value of environmental factors by
looking at variations in the value of marketed goods, such as houses or land.

9 Zabrinjavajuci stepen zagadenosti zraka u BiH, http://www.bistrobih.ba/nova/?

p=28447

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The difference between efficiency and equity is also important for an understanding of
the economics of pollution and health. Economists define efficiency in terms of total welfare
gains and losses. Equity, in contrast, is defined on the basis of who gains or losses. A policy that
is efficient is not necessarily equitable, and may in fact be rejected on an equity basis. In many
cases, distribution of environmental harms is not equitable.
Externalities arise when a market transaction affects individuals or firms other than those
involved in the transaction. A negative externality arises when a market transaction imposes costs
on individuals or firms not involved in the transaction; a positive externality arises when those
individuals or firms enjoy a benefit from the transaction.
In some uses of economic analysis, income differences can be presented as a justification for
unequal distribution of environmental harms. This approach can be particularly problematic
when it relies on defining the monetary value of a human life.
Methodologies for calculating the value of a "statistical life" include so-called wage-risk
analyses and analyses of foregone future income. Just as poor communities often bear a
disproportionate burden of pollution and environmental degradation compared with wealthier
communities within the same country, poor nations may bear a disproportionate burden from
toxic wastes that are exported from wealthier nations.
Poor nations may also bear a disproportionate burden from global warming and other
human-induced changes that affect the entire planet. For example, global warming is caused by
fossil fuel use, which historically has been concentrated in developed countries; yet the adverse
effects of global warming may be concentrated disproportionately in certain developing
countries.

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KEY TERMS AND CONCEPTS

Compensation: providing monetary payments or other resources to those who suffer an
inequitable burden from economic activities, policies, or environmental externalities.
Efficiency: The term efficiency in economics is often used to refer to Pareto efficiency.
A resource allocation is Pareto efficient if it maximizes cumulative welfare across
society. Pareto efficiency does not take account of equity concerns: a situation in which
all resources are concentrated in the hands of a few can be efficient.
Environmental Justice: the recognition that minority and low-income communities
often bear a disproportionate share of environmental costs and the perception that this is
unjust.
Endocrine disrupters: chemicals can interfere with the normal functioning of hormones
in the human body.
Equity: Equity is a measure of who gains or loses from a situation or policy.
Externality: an effect of a market transaction on individuals or firms other than those
involved in the transaction. A negative externality arises when a market transaction
imposes costs on individuals or firms not involved in the transaction; a positive

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externality arises when those individuals or firms enjoy a benefit from the transaction.
Foregone future income: the income an individual would have been expected to earn in
the absence of an illness, disabling event, or death. Foregone future income is one
measure used to place a monetary value on an illness, disability, or death.
Global warming: the increase in average global temperature as a result of emissions
from human activities.
Hedonic pricing: a method for estimating the dollar value of environmental factors by
looking at variations in the value of marketed goods, such as houses or land. For
example, economists may compare property values between two neighborhoods that are
similar in most respects but that differ in level of pollution, and estimate the price
differential related to the different levels of environmental quality.
Value of a statistical life: a monetary value placed on the possibility of loss of human
life associated with a particular policy or course of action.
Wage-risk analyses: a methodology for estimating the monetary value individuals place
on their physical safety, health, or life by measuring the wage increase associated with
high-risk jobs.

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Sources
Faber and Krieg (2002), Unequal Exposure to Ecological Hazards: Environmental Injustices in
the Commonwealth of Massachusetts.
Faber and McCarthy, "Neo-liberalism, Globalization and the Struggle for Ecological Democracy:
Linking Sustainability and Environmental Justice."
Gouveia-Vigeant, Tami and Joel Tickner (2003), Toxic Chemicals and Childhood Cancer: a
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