Food, Travel and Tech

People are willing to pay higher airfare for this reason–and it's not extra legroom

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When it comes to buying airfare, travelers are typically eager to find the best deals, but recent research shows a growing exception to this thrifty tradition.

In a new study from the University of British Columbia Sauder School of Business, people pledged to buy more expensive flights for a particular reason, and it had nothing to do with personal comfort. What the study found: They would be willing to pay more for airline tickets if it meant helping the environment.

The study, conducted with the Environmental Defense Fund, surveyed more than 1,800 U.S. participants online and assessed their reactions to a $14 carbon fee that was "presented to them in several different ways at the time of a hypothetical ticket purchase." Knowing the extra money would be used to address carbon emissions, participants responded happily — but how the fee was written was key to their willingness to pay it.

Participants responded better when the fee was described as a "carbon offset," rather than a tax, and when the carbon pricing was directed at airplane fuel producers rather than consumers.

For example, the majority of participants chose the more expensive flight ticket with a fee described as a "carbon offset for aviation fuel production and import" over a flight ticket with a fee described as a "carbon tax for airplane travel." They even chose the former over cheaper flight tickets that had no $14 fee attached to them at all, further indicating an inclination to pay the price for polluting the environment.

Youth march along Pennsylvania Avenue to the U.S. Capitol Building as part of the Global Climate Strike protests on September 20, 2019 in Washington, DC.
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The findings are a significant step for the global airline industry, which, according to the United Nations aviation body, is on track to triple its airplane emissions of carbon dioxide (a major greenhouse gas) by 2050 if no policies are put in place to regulate air travel's impact on the environment. Many commercial airlines have taken action with carbon offsetting programs, and now boutique travel companies are as well.

Just this month, travel guru Rick Steves and his 43-year-old tour company Rick Steves' Europe announced a $1 million "self-imposed carbon tax" to help counterweight emissions from the nearly 30,000 people it sends to Europe each year. The $1 million donation came from the company's profits as a voluntary tax on carbon dioxide emissions and went directly toward nonprofits promoting sustainable farming, reforestation and climate education.

Rick Steves' Europe follows a suite of larger companies around the world that have set the economically-friendly trend.

According to nonprofit Carbon Disclosure Project, which measures companies' environmental impacts, most recent data shows that the number of firms embedding an internal carbon price into their business strategies has grown from 150 global companies in 2014 to over 600 companies in 2017, including large corporations like Disney, Microsoft, Shell and General Motors.

The self-imposed taxes are not just to reduce emissions, but to promote energy efficiency and encourage cleaner power sources within organizations. And it doesn't hurt that being smart about contributing to the climate crisis is good for public relations.

"Standard accounting practices allow businesses to ignore costs to our environment, but we believe it's more honest and ethical to pay our share," CEO Rick Steves tells CNBC Make It.

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