Climate change, population ageing and public spending: Evidence on individual preferences
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Date
2017
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Abstract
Economic theory, as well as empirical research, suggest that elderly people
prefer public spending on policies yielding short-term benefits. This might be bad
news for policies aimed at combating climate change: while the unavoidable costs of
these policies arise today, the expected benefits occur in the distant future. Drawing
on data from over 12,000 households and using the ordered logit and the generalized
ordered logit model, we analyze whether attitudes towards climate change and climate
policies, as well as public spending preferences, differ with respect to age. Our
estimates show that elderly people are less concerned about climate change, but more
concerned about other global challenges. Furthermore, they are less likely to support
climate-friendly policies, such as the subsidization of renewables, and allocate less
public resources to environmental policies. Thus, our results suggest that the ongoing
demographic change in industrialized countries may undermine climate policies.
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Keywords
demographics, generalized ordered logit analysis, survey, attitudes