Working Paper: NBER ID: w9125
Authors: Wayne B. Gray; Ronald J. Shadbegian
Abstract: We examine measures of environmental regulatory activity (inspections and enforcement actions) and levels of air and water pollution at approximately 300 U.S. pulp and paper mills, using data for 1985-1997. We find that levels of air and water pollution emissions are affected both by the benefits from pollution abatement and by the characteristics of the people exposed to the pollution. The results suggest substantial differences in the weights assigned to different types of people: the benefits received by out-of-state people seem to count only half as much as benefits received in-state, although their weight increases if the bordering state's Congressional delegation is strongly pro-environment. Some variables are also associated with greater regulatory activity being directed towards the plant, but those results are less consistent with our hypotheses than the pollution emissions results. One set of results was consistently contrary to expectations: plants with more nonwhites nearby emit less pollution. Some of our results might be due to endogenous sorting of people based on pollution levels, but an attempt to examine this using the local population turnover rate found evidence of sorting for only one of four pollutants.
Keywords: environmental regulation; pollution abatement; pulp and paper mills; demographic factors; regulatory activity
JEL Codes: Q28; L51
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| benefits of pollution abatement (Q52) | levels of pollution emissions (Q53) |
| presence of children and elderly (J13) | air pollution emissions (Q53) |
| neighborhood wealth (R20) | regulatory scrutiny (G18) |
| regulatory scrutiny (G18) | levels of pollution emissions (Q53) |
| percentage of nonwhite individuals nearby (R23) | levels of pollution emissions (Q53) |
| pro-environment congressional representation (Q56) | levels of pollution emissions (Q53) |
| state boundaries (H73) | levels of pollution emissions (Q53) |