The role of income of workers on the environment: Does gender matter?

Purpose In this study, I employed the theory underlying the Environmental Kuznets Curve (EKC) hypothesis to investigate how the annual income of workers impacts the environment. Design/methodology/approach A sample of 20 Organisation for Economic Co-operation and Development (OECD) countries from 2005 to 2021 was outlined. Moreover, I utilized total greenhouse gas emissions and the ecological footprint as proxies for environmental degradation, along with two econometric methods to obtain robust results. Findings The results show an inverted U-shaped relationship between workers’ income and environmental degradation, indicating that increasing their annual income can worsen environmental quality at lower income levels. However, after passing the maximum point, increases in the annual income of workers cause a decrease in two ecological indices. I also tested the impact of male and female incomes on the environment. Both male and female annual incomes have an inverted U-shaped linkage with environmental degradation. However, male workers require higher incomes than female workers to modify their behaviors and lifestyles to preserve the environment. Trade openness and inflation also harm the environment. The outcomes show the unfavorable effect of fossil fuel consumption on the environment, but this effect is not significant in three out of twelve estimations. Research limitations/implications While this study provides useful insights, some limitations should be acknowledged. The relatively homogeneous sample of 20 OECD countries, selected due to data availability, may limit the generalizability of the findings. Moreover, income is represented only by average annual employee income, which overlooks capital income, social transfers, undeclared work and disparities within employees (e.g. between the richest and poorest groups). Similarly, environmental degradation is assessed through ecological footprint and total greenhouse gas emissions, which, although informative, do not capture other important dimensions such as biodiversity loss or soil and plastic pollution. Originality/value Previous scholars have usually focused on the inverted U-shaped linkage between gross domestic product per capita and ecological indices. However, in this study, the average annual income of employees is used to examine the Kuznets hypothesis. This is because wealth distribution is often neglected in macroeconomic studies on EKC. Moreover, I highlight the gender dimension by comparing the environmental impacts of male and female workers’ incomes, which has never been addressed in the literature.