Currie’s paper shows that babies born in polluted neighborhoods are significantly worse off for the rest of their lives than ones born in environmentally cleaner areas. Since poor people tend to live in the more polluted areas, this is one reason why inequality persists from generation to generation.
This is a marvelous example of how to amass data. Currie takes something obvious, that it’s bad to live near toxic waste, and shows with great precision exactly how bad it is. That is an achievement in its own right. It also allows us to compare this problem with others that, on their face, are also pretty bad. How much should we allocate towards cleaning up pollution as opposed to transportation to make it easier to get to jobs or education to make it easier to get a job? Granular work like this helps a lot in answering that kind of question.
There is a twist. We generally think of environmental justice in terms of places. Roughly speaking, the thought is something like, “we should clean up these places where poor people live to make society more just.” But Currie thinks that the lesson of her piece is that we should look for policies that address the people affected rather than trying to clean up places. Why? Because cleaning up a place makes it more expensive. The poor people then move to a place that’s just as bad as the old one was (Currie 2011, 17).
First, I found the distinction between place-based and person-based policies surprising and interesting. I had not thought of it that way! If you are curious about this, you might have a look at a Brookings Institution publication titled Place-Based Policies for Shared Economic Growth.
Second, I have some reservations about framing the project in terms of equal opportunity. It seems to me that the problem is that we are poisoning babies. That hampers their ability to compete in the labor market, but that is not the most fundamental reason why it is troubling. If you cut off my hand, I would not be able to type as well and so I would suffer economic losses. But it would still be wrong even if I were retired or uninterested in working. It’s my hand!
Another way of putting that is that we could equalize things by exposing everyone’s kids to the same level of pollution. Or, if you are more focused on the racial disparities, we could seek to make it so that exposure to pollution were strictly a matter of economic class rather than race: make sure the poor white babies are poisoned in proportion to their race’s share of the population. But I don’t think anyone would be happy with doing that. That suggests to me that it isn’t the inequality or racial injustice that really bothers us.
That said, I doubt that equal opportunity is all that central to her project. My best guess is that she framed it that way because the lecture was named for someone who worked on that topic. If I am right about that, the material about equal opportunity is there because she did her best to relate her work to his. It’s just a guess, though.
Professor Brown referred to Gregory Mankiw’s height tax paper. Here is the actual paper and here is a brief summary.
The point was satirical. Mankiw and his co-author meant to show that a particular model of optimal taxation would lead to what they regard as the absurd result that tall people should be taxed more than short ones. Here is their abstract.
Should the income tax include a credit for short taxpayers and a surcharge for tall ones? The standard utilitarian framework for tax analysis answers this question in the affirmative. Moreover, a plausible parameterization using data on height and wages implies a substantial height tax: a tall person earning $50,000 should pay $4,500 more in tax than a short person. One interpretation is that personal attributes correlated with wages should be considered more widely for determining taxes. Alternatively, if policies such as a height tax are rejected, then the standard utilitarian framework must fail to capture intuitive notions of distributive justice.
I think it is pretty clear that the authors favor the alternative interpretation. They reject the height tax and other taxes that are thought to be acceptable but, they claim, fundamentally similar to the height tax.
That said, one thing to be said in favor of a height tax is that it would not distort anyone’s behavior! It’s like a head tax that way, only involving more of the body.
Thank you very much folks, you’re a great audience. I have to go now, but I will be here all week. Tell your friends!