IDEAS home Printed from https://ideas.repec.org/a/kap/regeco/v57y2020i2d10.1007_s11149-019-09398-5.html
   My bibliography  Save this article

The effect of environmental enforcement on labor: environmental workers and production workers

Author

Listed:
  • Zach Raff

    (University of Wisconsin-Stout)

  • Dietrich Earnhart

    (University of Kansas)

Abstract

This study examines the effects of environmental enforcement on labor employed by regulated facilities. The empirical analysis uses panel data from an original survey of chemical manufacturing facilities regulated under the Clean Water Act. This study contributes to the literature in two ways. First, we distinguish between two types of labor employed by regulated facilities: labor dedicated to regulatory compliance (“environmental labor”) and labor dedicated to production (“production labor”). Second, we estimate the effect of environmental enforcement on production labor. Environmental enforcement seeks to induce compliance with Clean Water Act restrictions, i.e., discharge limits, by prompting greater environmental management. However, environmental labor and production labor play different roles regarding environmental management. Consistent with this difference, our empirical analysis explores the two labor outcomes separately. Our study explores various forms of enforcement, interpreted broadly to include monitoring inspections and enforcement actions, e.g., fines (“government interventions”). In general, our empirical results reveal that government interventions do not affect environmental labor, yet negatively affect production labor.

Suggested Citation

  • Zach Raff & Dietrich Earnhart, 2020. "The effect of environmental enforcement on labor: environmental workers and production workers," Journal of Regulatory Economics, Springer, vol. 57(2), pages 118-133, April.
    • Handle: RePEc:kap:regeco:v:57:y:2020:i:2:d:10.1007_s11149-019-09398-5
    DOI: 10.1007/s11149-019-09398-5
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11149-019-09398-5
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11149-019-09398-5?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gray, Wayne B. & Shadbegian, R.J.Ronald J., 2004. "'Optimal' pollution abatement--whose benefits matter, and how much?," Journal of Environmental Economics and Management, Elsevier, vol. 47(3), pages 510-534, May.
    2. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    3. Gray, Wayne B. & Shadbegian, Ronald J. & Wang, Chunbei & Meral, Merve, 2014. "Do EPA regulations affect labor demand? Evidence from the pulp and paper industry," Journal of Environmental Economics and Management, Elsevier, vol. 68(1), pages 188-202.
    4. Berman, Eli & Bui, Linda T. M., 2001. "Environmental regulation and labor demand: evidence from the South Coast Air Basin," Journal of Public Economics, Elsevier, vol. 79(2), pages 265-295, February.
    5. Nakamura, Masao & Takahashi, Takuya & Vertinsky, Ilan, 2001. "Why Japanese Firms Choose to Certify: A Study of Managerial Responses to Environmental Issues," Journal of Environmental Economics and Management, Elsevier, vol. 42(1), pages 23-52, July.
    6. Anton, W.R.Q.Wilma Rose Q. & Deltas, George & Khanna, Madhu, 2004. "Incentives for environmental self-regulation and implications for environmental performance," Journal of Environmental Economics and Management, Elsevier, vol. 48(1), pages 632-654, July.
    7. Friesen, Lana, 2003. "Targeting enforcement to improve compliance with environmental regulations," Journal of Environmental Economics and Management, Elsevier, vol. 46(1), pages 72-85, July.
    8. W. Reed Walker, 2011. "Environmental Regulation and Labor Reallocation: Evidence from the Clean Air Act," American Economic Review, American Economic Association, vol. 101(3), pages 442-447, May.
    9. Morgenstern, Richard D. & Pizer, William A. & Shih, Jhih-Shyang, 2002. "Jobs Versus the Environment: An Industry-Level Perspective," Journal of Environmental Economics and Management, Elsevier, vol. 43(3), pages 412-436, May.
    10. Dietrich Earnhart & Lana Friesen, 2013. "Can Punishment Generate Specific Deterrence Without Updating? Analysis of a Stated Choice Scenario," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 56(3), pages 379-397, November.
    11. Raff, Zach & Earnhart, Dietrich, 2019. "The effects of Clean Water Act enforcement on environmental employment," Resource and Energy Economics, Elsevier, vol. 57(C), pages 1-17.
    12. Earnhart, Dietrich, 2004. "Regulatory factors shaping environmental performance at publicly-owned treatment plants," Journal of Environmental Economics and Management, Elsevier, vol. 48(1), pages 655-681, July.
    13. Magali A. Delmas & Michael W. Toffel, 2008. "Organizational responses to environmental demands: opening the black box," Strategic Management Journal, Wiley Blackwell, vol. 29(10), pages 1027-1055, October.
    14. Gray, Wayne B. & Deily, Mary E., 1996. "Compliance and Enforcement: Air Pollution Regulation in the U.S. Steel Industry," Journal of Environmental Economics and Management, Elsevier, vol. 31(1), pages 96-111, July.
    15. Wayne B. Gray & Jay P. Shimshack, 2011. "The Effectiveness of Environmental Monitoring and Enforcement: A Review of the Empirical Evidence," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 5(1), pages 3-24, Winter.
    16. Mary Evans & Lirong Liu & Sarah Stafford, 2011. "Do environmental audits improve long-term compliance? Evidence from manufacturing facilities in Michigan," Journal of Regulatory Economics, Springer, vol. 40(3), pages 279-302, December.
    17. Kozo Horiuchi & Masao Nakamura, 2001. "Environmental Issues and Japanese Firms," Palgrave Macmillan Books, in: Masao Nakamura (ed.), The Japanese Business and Economic System, chapter 13, pages 364-384, Palgrave Macmillan.
    18. Ann E. Ferris & Ronald J. Shadbegian & Ann Wolverton, 2014. "The Effect of Environmental Regulation on Power Sector Employment: Phase I of the Title IV SO2 Trading Program," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 1(4), pages 521-553.
    19. Sah, Raaj K, 1991. "Social Osmosis and Patterns of Crime," Journal of Political Economy, University of Chicago Press, vol. 99(6), pages 1272-1295, December.
    20. Dietrich Earnhart & Dylan G. Rassier, 2016. "“Effective regulatory stringency” and firms’ profitability: the effects of effluent limits and government monitoring," Journal of Regulatory Economics, Springer, vol. 50(2), pages 111-145, October.
    21. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 31(3), pages 129-137.
    22. Barla, Philippe, 2007. "ISO 14001 certification and environmental performance in Quebec's pulp and paper industry," Journal of Environmental Economics and Management, Elsevier, vol. 53(3), pages 291-306, May.
    23. Glenn Sheriff & Ann E. Ferris & Ronald J. Shadbegian, 2015. "How Did Air Quality Standards Affect Employment at U.S. Power Plants? The Importance of Stringency, Geography, and Timing," NCEE Working Paper Series 201501, National Center for Environmental Economics, U.S. Environmental Protection Agency, revised May 2015.
    24. Zach Raff & Dietrich Earnhart, 2018. "Effect Of Cooperative Enforcement Strategies On Wastewater Management," Economic Inquiry, Western Economic Association International, vol. 56(2), pages 1357-1379, April.
    25. Shimshack, Jay P. & Ward, Michael B., 2005. "Regulator reputation, enforcement, and environmental compliance," Journal of Environmental Economics and Management, Elsevier, vol. 50(3), pages 519-540, November.
    26. Earnhart, Dietrich & Segerson, Kathleen, 2012. "The influence of financial status on the effectiveness of environmental enforcement," Journal of Public Economics, Elsevier, vol. 96(9-10), pages 670-684.
    27. Sarah L. Stafford, 2011. "Do Environmental Audits Improve Long-term Compliance? Evidence from Manufacturing Facilities in Michigan," Working Papers 117, Department of Economics, College of William and Mary.
    28. Laplante, Benoit & Rilstone, Paul, 1996. "Environmental Inspections and Emissions of the Pulp and Paper Industry in Quebec," Journal of Environmental Economics and Management, Elsevier, vol. 31(1), pages 19-36, July.
    29. Eric Helland, 1998. "The Enforcement Of Pollution Control Laws: Inspections, Violations, And Self-Reporting," The Review of Economics and Statistics, MIT Press, vol. 80(1), pages 141-153, February.
    30. Dietrich Earnhart, 2009. "The influence of facility characteristics and permit conditions on the effectiveness of environmental regulatory deterrence," Journal of Regulatory Economics, Springer, vol. 36(3), pages 247-273, December.
    31. Harrington, Winston, 1988. "Enforcement leverage when penalties are restricted," Journal of Public Economics, Elsevier, vol. 37(1), pages 29-53, October.
    32. Michael Greenstone, 2002. "The Impacts of Environmental Regulations on Industrial Activity: Evidence from the 1970 and 1977 Clean Air Act Amendments and the Census of Manufactures," Journal of Political Economy, University of Chicago Press, vol. 110(6), pages 1175-1219, December.
    33. Steven Shavell & A. Mitchell Polinsky, 2000. "The Economic Theory of Public Enforcement of Law," Journal of Economic Literature, American Economic Association, vol. 38(1), pages 45-76, March.
    34. Dietrich Earnhart, 2004. "The Effects of Community Characteristics on Polluter Compliance Levels," Land Economics, University of Wisconsin Press, vol. 80(3), pages 408-432.
    35. Madhu Khanna & William Rose Q. Anton, 2002. "Corporate Environmental Management: Regulatory and Market-Based Incentives," Land Economics, University of Wisconsin Press, vol. 78(4), pages 539-558.
    36. Earnhart, Dietrich & Harrington, Donna Ramirez, 2014. "Effect of audits on the extent of compliance with wastewater discharge limits," Journal of Environmental Economics and Management, Elsevier, vol. 68(2), pages 243-261.
    37. Earnhart, Dietrich & Mark Leonard, J., 2016. "Environmental audits and signaling: The role of firm organizational structure," Resource and Energy Economics, Elsevier, vol. 44(C), pages 1-22.
    38. Donna Ramirez Harrington & Madhu Khanna & George Deltas, 2008. "Striving to be green: the adoption of total quality environmental management," Applied Economics, Taylor & Francis Journals, vol. 40(23), pages 2995-3007.
    39. Dietrich Earnhart, 2004. "Panel Data Analysis of Regulatory Factors Shaping Environmental Performance," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 391-401, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ran Gu & Zenghua He, 2023. "Can Environmental Regulation Improve Labor Allocation Efficiency? Evidence from China’s New Environmental Protection Law," Sustainability, MDPI, vol. 15(7), pages 1-15, March.
    2. Charlotte Bez & Maria Enrica Virgillito, 2022. "Toxic pollution and labour markets: uncovering Europe's left-behind places," LEM Papers Series 2022/19, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    3. Jiyu Zhao & Ning Zhang, 2023. "Environmental regulation and labor market: a bibliometric analysis," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(7), pages 6095-6116, July.
    4. Dietrich Earnhart & Nathan P. Hendricks, 2023. "Adapting to water restrictions: Intensive versus extensive adaptation over time differentiated by water right seniority," American Journal of Agricultural Economics, John Wiley & Sons, vol. 105(5), pages 1458-1490, October.
    5. Yunlong Cheng & Jian Yang, 2023. "Spatial and Temporal Divergence in the Coupling Coordination of Digital Economy, Environmental Regulation and Sustainable Development: An Experience Study in China," Sustainability, MDPI, vol. 15(12), pages 1-16, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Raff, Zach & Earnhart, Dietrich, 2019. "The effects of Clean Water Act enforcement on environmental employment," Resource and Energy Economics, Elsevier, vol. 57(C), pages 1-17.
    2. Zach Raff & Dietrich Earnhart, 2018. "Effect Of Cooperative Enforcement Strategies On Wastewater Management," Economic Inquiry, Western Economic Association International, vol. 56(2), pages 1357-1379, April.
    3. Earnhart, Dietrich & Friesen, Lana, 2017. "The Effects of Regulated Facilities' Perceptions About the Effectiveness of Government Interventions on Environmental Compliance," Ecological Economics, Elsevier, vol. 142(C), pages 282-294.
    4. Earnhart, Dietrich & Harrington, Donna Ramirez, 2014. "Effect of audits on the extent of compliance with wastewater discharge limits," Journal of Environmental Economics and Management, Elsevier, vol. 68(2), pages 243-261.
    5. Earnhart, Dietrich & Mark Leonard, J., 2016. "Environmental audits and signaling: The role of firm organizational structure," Resource and Energy Economics, Elsevier, vol. 44(C), pages 1-22.
    6. Alm, James & Shimshack, Jay, 2014. "Environmental Enforcement and Compliance: Lessons from Pollution, Safety, and Tax Settings," Foundations and Trends(R) in Microeconomics, now publishers, vol. 10(4), pages 209-274, December.
    7. Dietrich Earnhart & Lana Friesen, 2021. "Enforcement Federalism: Comparing the Effectiveness of Federal Punishment versus State Punishment," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 78(2), pages 227-255, February.
    8. Earnhart, Dietrich & Friesen, Lana, 2021. "Use of competitive endogenous audit mechanisms by federal and state inspectors within environmental protection agencies," Journal of Environmental Economics and Management, Elsevier, vol. 109(C).
    9. Thomas J. Miceli & Kathleen Segerson & Dietrich Earnhart, 2022. "The role of experience in deterring crime: A theory of specific versus general deterrence," Economic Inquiry, Western Economic Association International, vol. 60(4), pages 1833-1853, October.
    10. Lana Friesen & Dietrich Earnhart, 2012. "Environmental Management Responses to Punishment: Specific Deterrence and Certainty versus Severity of Punishment," Discussion Papers Series 463, School of Economics, University of Queensland, Australia.
    11. Dietrich Earnhart & Dylan G. Rassier, 2016. "“Effective regulatory stringency” and firms’ profitability: the effects of effluent limits and government monitoring," Journal of Regulatory Economics, Springer, vol. 50(2), pages 111-145, October.
    12. Earnhart, Dietrich, 2020. "Stated choices of environmental managers: The role of punishment," International Review of Law and Economics, Elsevier, vol. 63(C).
    13. Dietrich Earnhart & Lana Friesen, 2013. "Can Punishment Generate Specific Deterrence Without Updating? Analysis of a Stated Choice Scenario," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 56(3), pages 379-397, November.
    14. Earnhart, Dietrich & Segerson, Kathleen, 2012. "The influence of financial status on the effectiveness of environmental enforcement," Journal of Public Economics, Elsevier, vol. 96(9-10), pages 670-684.
    15. Jay P. Shimshack, 2014. "The Economics of Environmental Monitoring and Enforcement," Annual Review of Resource Economics, Annual Reviews, vol. 6(1), pages 339-360, October.
    16. Zach Raff, 2023. "Identifying the regulator’s objective: Does political support matter?," Public Choice, Springer, vol. 194(3), pages 277-295, March.
    17. Francesco Vona & Giovanni Marin & Davide Consoli & David Popp, 2015. "Green Skills," Working Papers 2015.72, Fondazione Eni Enrico Mattei.
    18. Wayne B. Gray & Jay P. Shimshack, 2011. "The Effectiveness of Environmental Monitoring and Enforcement: A Review of the Empirical Evidence," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 5(1), pages 3-24, Winter.
    19. Earnhart, Dietrich H. & Glicksman, Robert L., 2015. "Coercive vs. cooperative enforcement: Effect of enforcement approach on environmental management," International Review of Law and Economics, Elsevier, vol. 42(C), pages 135-146.
    20. repec:hal:spmain:info:hdl:2441/1fkb59dcsg9alqqq6qv18jj5us is not listed on IDEAS
    21. Francesco Vona & Giovanni Marin & Davide Consoli & David Popp, 2018. "Environmental Regulation and Green Skills: An Empirical Exploration," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 5(4), pages 713-753.

    More about this item

    Keywords

    Clean Water Act; Environmental labor; Enforcement; Environmental regulation;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • K32 - Law and Economics - - Other Substantive Areas of Law - - - Energy, Environmental, Health, and Safety Law
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:regeco:v:57:y:2020:i:2:d:10.1007_s11149-019-09398-5. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.