Effects of air quality regulations on polluting industries

Citation
R. Becker et V. Henderson, Effects of air quality regulations on polluting industries, J POLIT EC, 108(2), 2000, pp. 379-421
Citations number
28
Categorie Soggetti
Economics
Journal title
JOURNAL OF POLITICAL ECONOMY
ISSN journal
00223808 → ACNP
Volume
108
Issue
2
Year of publication
2000
Pages
379 - 421
Database
ISI
SICI code
0022-3808(200004)108:2<379:EOAQRO>2.0.ZU;2-E
Abstract
This paper examines unintended effects of air quality regulation, using pla nt data for 1963-92. A key regulatory tool since 1978 is the annual designa tion of county air quality attainment status. Nonattainment status triggers specific equipment requirements, with the severity and enforcement of regu lations rising with plant size. The differential in regulation favors attai nment areas, reducing births for polluting industries in nonattainment area s by 26-45 percent. Industries and sectors with bigger plants are affected the most, shifting industrial structure toward less regulated single-plant firms. Large preregulation plants do benefit from grandfathering provisions , but both grandfathering and shifts to small-scale new plants contribute t o environmental degradation.