The Electric Gini: Income Redistribution through Energy Prices

A-Tier
Journal: American Economic Journal: Economic Policy
Year: 2022
Volume: 14
Issue: 2
Pages: 341-65

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

In theory, regulators concerned about inequality will deviate from efficient two-part tariffs, charging lower-than-efficient fixed monthly fees and higher-than-efficient per-kilowatt-hour prices. To quantify that relationship, we develop a measure of the redistributive extent of utility tariffs: the "electric Gini." Utilities with higher electric Ginis shift more costs from households using relatively little electricity to households using more. In practice, US utilities whose ratepayers have more unequal incomes have higher electric Ginis. But electricity demand is only loosely correlated with income, which means that electricity prices are an indirect and ineffective policy for countering income inequality.

Technical Details

RePEc Handle
repec:aea:aejpol:v:14:y:2022:i:2:p:341-65
Journal Field
General
Author Count
2
Added to Database
2026-01-25