Working Paper: NBER ID: w26687
Authors: Joseph E. Aldy; Maximilian Auffhammer; Maureen Cropper; Arthur Fraas; Richard Morgenstern
Abstract: We synthesize and review retrospective analyses of federal air quality regulations to examine the contributions of the Clean Air Act to the vast air quality improvements seen since 1970. Geographic heterogeneity in stringency affects emissions, public health, compliance costs, and employment. Cap-and-trade has delivered greater emission reductions at lower cost than conventional mandates, yet has fallen short of textbook ideals. Market power also influenced the CAA’s benefits and costs. New benefit categories have been identified ex post, but specific technology requirements have not yet been rigorously evaluated. Comparisons of aggregate benefits and costs of the CAA are beyond present capabilities.
Keywords: Clean Air Act; air quality regulation; public health; emissions reductions; cap-and-trade
JEL Codes: Q53; Q54; Q58
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| reduction of six common air pollutants (Q53) | improved public health outcomes (I14) |
| Clean Air Act (CAA) (Q58) | economic incentives (M52) |
| economic incentives (M52) | reduction in emissions (Q52) |
| cap-and-trade systems (Q58) | greater emission reductions (Q52) |
| cap-and-trade systems (Q58) | conventional mandates (F53) |
| Clean Air Act (CAA) (Q58) | reduction of six common air pollutants (Q53) |
| Clean Air Act (CAA) (Q58) | improved public health outcomes (I14) |