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Spatial Heterogeneity in Environmental Regulation Enforcement and the Firm Location Decision among U.S. Counties

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Author Info
O. Ashton Morgan
Simon Condliffe

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Abstract

We estimate a negative binomial model with fixed effects to examine the impact of spatial differences in environmental regulation on manufacturing capital flows. Using a newly available data set, we find that stricter air quality standards deter births of polluting plants, suggesting heterogeneity in regulatory standards may create a temporal browning process. We also find that spatial differences in environmental regulation do not play a role in the location decision of non-pollution intensive plants. Key Words: Environmental regulation, firm location, air pollution

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File URL: http://econ.appstate.edu/RePEc/pdf/wp0912.pdf
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Paper provided by Department of Economics, Appalachian State University in its series Working Papers with number 09-12.

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Date of creation: 2009
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Handle: RePEc:apl:wpaper:09-12

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Keywords:

Find related papers by JEL classification:
R38 - Urban, Rural, and Regional Economics - - Production Analysis and Firm Location - - - Government Policies; Regulatory Policies
Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling

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  1. Henderson, J Vernon, 1996. "Effects of Air Quality Regulation," American Economic Review, American Economic Association, vol. 86(4), pages 789-813, September. [Downloadable!] (restricted)
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  2. repec:bep:eapadv:v:4:y:2004:i:2:p:1204-1204 is not listed on IDEAS
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  3. Carlton, Dennis W, 1983. "The Location and Employment Choices of New Firms: An Econometric Model with Discrete and Continuous Endogenous Variables," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 440-49, August. [Downloadable!] (restricted)
  4. Cletus C. Coughlin & Eran Segev, 2000. "Location Determinants of New Foreign-Owned Manufacturing Plants," Journal of Regional Science, Blackwell Publishing, vol. 40(2), pages 323-351. [Downloadable!] (restricted)
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  5. Adam B. Jaffe et al., 1995. "Environmental Regulation and the Competitiveness of U.S. Manufacturing: What Does the Evidence Tell Us?," Journal of Economic Literature, American Economic Association, vol. 33(1), pages 132-163, March. [Downloadable!] (restricted)
  6. John A. List & Daniel L. Millimet & Per G. Fredriksson & W. Warren McHone, 2003. "Effects of Environmental Regulations on Manufacturing Plant Births: Evidence from a Propensity Score Matching Estimator," The Review of Economics and Statistics, MIT Press, vol. 85(4), pages 944-952, 09. [Downloadable!] (restricted)
  7. List, John A., 2001. "US county-level determinants of inbound FDI: evidence from a two-step modified count data model," International Journal of Industrial Organization, Elsevier, vol. 19(6), pages 953-973, May. [Downloadable!] (restricted)
  8. Randy Becker & Vernon Henderson, 2000. "Effects of Air Quality Regulations on Polluting Industries," Journal of Political Economy, University of Chicago Press, vol. 108(2), pages 379-421, April. [Downloadable!] (restricted)
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This page was last updated on 2009-11-14.

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