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Measuring the Effects of Environmental Regulations: The Critical Importance of a Spatially Disaggregated Analysis

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Author Info
Maximilian Auffhammer (University of California, Berkeley)
Antonio Bento (Cornell University)
Scott Lowe (Boise State University)
Abstract

We examine the effects of the 1990 Clean Air Act Amendments (CAAA) on ambient concentrations of PM10 in the United States between 1990 and 2005. Consistent with prior literature, we find that non-attainment designation has no effect on the average monitor in non-attainment counties, after controlling for weather, socioeconomic characteristics at the county level and lagged concentrations. In sharp contrast, if we allow for heterogeneous treatment by type of monitor and county, we do find that the 1990 CAAA produced substantial effects. Our estimation results suggest that non-attainment counties with single monitors experienced a drop in concentrations of 10.5% relative to attainment counties. In non-attainment counties with multiple monitors, the overall effect of the regulation is an increase of ambient PM10 concentrations by 1.9%. The dirtiest monitors in these counties, however, experienced drops in PM10 of 6.1%, which suggest that regulators focus their attention on the dirtiest monitors.

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Paper provided by Department of Agricultural & Resource Economics, UC Berkeley in its series Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series with number 1047.

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Date of creation: 29 Aug 2007
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Handle: RePEc:cdl:agrebk:1047

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Keywords: Air Pollution; Clean Air Act; Spatial Modeling;

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  1. Daniel L. Millimet & John A. List & Thanasis Stengos, 2003. "The Environmental Kuznets Curve: Real Progress or Misspecified Models?," The Review of Economics and Statistics, MIT Press, vol. 85(4), pages 1038-1047, 09. [Downloadable!] (restricted)
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  2. Kenneth Y. Chay & Michael Greenstone, 2005. "Does Air Quality Matter? Evidence from the Housing Market," Journal of Political Economy, University of Chicago Press, vol. 113(2), pages 376-424, April.
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  3. 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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  4. Janet Currie & Matthew Neidell, 2005. "Air Pollution and Infant Health: What Can We Learn from California's Recent Experience?," The Quarterly Journal of Economics, MIT Press, vol. 120(3), pages 1003-1030, August.
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  5. Greenstone, Michael, 2004. "Did the Clean Air Act cause the remarkable decline in sulfur dioxide concentrations?," Journal of Environmental Economics and Management, Elsevier, vol. 47(3), pages 585-611, May. [Downloadable!] (restricted)
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