Decomposing changes in CO2 emission inequality over time: The roles of re-ranking and changes in per capita CO2 emission disparities

This paper analyzes the effects of changes in country ranking and per capita CO2 emissions on the change in CO2 emission inequality over time. For this purpose, we introduce a three-term decomposition of the change occurring in the Gini index of per capita CO2 emissions when moving from an initial to a final per capita CO2 emission distribution. The decomposition explains the link between the inequality trend and the changes in country ranking, population size, and per capita CO2 emission disparities. We show that all components of inequality change can be further decomposed by subgroup. This provides analysts with a decomposition technique detecting the within-group and between-group contributions to each component of inequality change. The decomposition is used to analyze the change in per capita CO2 emission inequality in Europe over the 1991-2011 period.