Emeline Bezin (University of Rennes – CREM)
We develop a theory of lifestyle-based identity politics and apply it to the political economy of carbon taxation. Lifestyles define groups whose members share both consumption patterns — here carbon-intensive or low-carbon consumption technologies — and a common set of values. Individuals identify with groups according to their sense of belonging, which depends on their distance from other group members and the pride they derive from their group’s social status. Considering alternative identities through which individuals may define themselves, we show that several equilibrium regimes can emerge: a low-tax equilibrium in which the median voter identifies with the carbon-intensive lifestyle group, and a high-tax equilibrium in which she adopts an alternative identity, referred to as the inclusive identity in our main application. We characterize the conditions under which a backlash occurs: a switch from the high-tax, inclusive-identity regime to the low-tax, lifestyle-based one.