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What Determines Environmental Performance at Paper Mills? The Roles of Abatement Spending, Regulation, and Efficiency

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Author Info
Ronald J Shadbegian
Wayne B Gray

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Abstract

This paper examines the determinants of environmental performance at paper mills, measured by air pollution emissions per unit of output. We consider differences across plants in air pollution abatement expenditures, local regulatory stringency, and productive efficiency. Emissions are significantly lower in plants with a larger air pollution abatement capital stock: a 10 percent increase in abatement capital stock appears to reduce emissions by 6.9 percent. This translates into a sizable social return: one dollar of abatement capital stock is estimated to provide and annual return of about 75 cents in pollution reduction benefits. Local regulatory stringency and productive efficiency also matter: plants in non-attainment counties have 43 percent lower emissions and plants with 10 percent higher productivity have 2.5 percent lower emissions. For pollution abatement operating costs we find (puzzlingly) positive, but always insignificant, coefficients.

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File URL: http://www.ces.census.gov/index.php/ces/cespapers?down_key=101676
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Paper provided by Center for Economic Studies, U.S. Census Bureau in its series Working Papers with number 03-10.

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Date of creation: Apr 2003
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Handle: RePEc:cen:wpaper:03-10

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Keywords: CES; economic; research; micro; data; microdata; chief; economist;

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Robert H Mcguckin & George A Pascoe, 1988. "The Longitudinal Research Database (LRD): Status And Research Possibilities," Working Papers 88-2, Center for Economic Studies, U.S. Census Bureau. [Downloadable!]
  2. 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. [Downloadable!] (restricted)
  3. 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. [Downloadable!] (restricted)
  4. Halvorsen, Robert & Palmquist, Raymond, 1980. "The Interpretation of Dummy Variables in Semilogarithmic Equations," American Economic Review, American Economic Association, vol. 70(3), pages 474-75, June. [Downloadable!] (restricted)
  5. 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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  6. Becker, Randy A., 2005. "Air pollution abatement costs under the Clean Air Act: evidence from the PACE survey," Journal of Environmental Economics and Management, Elsevier, vol. 50(1), pages 144-169, July. [Downloadable!] (restricted)
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  7. Gollop, Frank M & Roberts, Mark J, 1983. "Environmental Regulations and Productivity Growth: The Case of Fossil-Fueled Electric Power Generation," Journal of Political Economy, University of Chicago Press, vol. 91(4), pages 654-74, August. [Downloadable!] (restricted)
  8. Eric J. Bartelsman & Wayne Gray, 1996. "The NBER Manufacturing Productivity Database," NBER Technical Working Papers 0205, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  9. Barbera, Anthony J & McConnell, Virginia D, 1986. "Effects of Pollution Control on Industry Productivity: A Factor Demand Approach," Journal of Industrial Economics, Blackwell Publishing, vol. 35(2), pages 161-72, December. [Downloadable!] (restricted)
  10. Magat, Wesley A & Viscusi, W Kip, 1990. "Effectiveness of the EPA's Regulatory Enforcement: The Case of Industrial Effluent Standards," Journal of Law & Economics, University of Chicago Press, vol. 33(2), pages 331-60, October.
  11. Randy A. Becker & J. Vernon Henderson, 2001. "Costs of Air Quality Regulation," NBER Chapters, in: Behavioral and Distributional Effects of Environmental Policy, pages 159-186 National Bureau of Economic Research, Inc. [Downloadable!]
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  12. Carlo Carraro & Gilbert E. Metcalf, 2000. "Behavioral and Distributional Effects of Environmental Policy: Introduction," Discussion Papers Series, Department of Economics, Tufts University 0011, Department of Economics, Tufts University. [Downloadable!]
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  13. Wayne B. Gray, 1997. "Manufacturing Plant Location: Does State Pollution Regulation Matter?," NBER Working Papers 5880, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  14. Gray, Wayne B, 1987. "The Cost of Regulation: OSHA, EPA and the Productivity Slowdown," American Economic Review, American Economic Association, vol. 77(5), pages 998-1006, December. [Downloadable!] (restricted)
  15. Eli Berman & Linda T. M. Bui, 2001. "Environmental Regulation And Productivity: Evidence From Oil Refineries," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 498-510, August. [Downloadable!] (restricted)
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  16. Nadeau, Louis W., 1997. "EPA Effectiveness at Reducing the Duration of Plant-Level Noncompliance," Journal of Environmental Economics and Management, Elsevier, vol. 34(1), pages 54-78, September. [Downloadable!] (restricted)
  17. Kahn, Matthew E., 1999. "The Silver Lining of Rust Belt Manufacturing Decline," Journal of Urban Economics, Elsevier, vol. 46(3), pages 360-376, November. [Downloadable!] (restricted)
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  18. Gray, Wayne B & Shadbegian, Ronald J, 1998. "Environmental Regulation, Investment Timing, and Technology Choice," Journal of Industrial Economics, Blackwell Publishing, vol. 46(2), pages 235-56, June. [Downloadable!] (restricted)
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  19. Gray, Wayne B. & Shadbegian, Ronald J., 2003. "Plant vintage, technology, and environmental regulation," Journal of Environmental Economics and Management, Elsevier, vol. 46(3), pages 384-402, November. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Li, Zhe, 2008. "Productivity Dispersion across Plants, Emission Abatement, and Environmental Policy," MPRA Paper 9564, University Library of Munich, Germany. [Downloadable!]
  2. Wayne B. Gray & Ronald J. Shadbegian, 2002. "Optimal Pollution Abatement - Whose Benefits Matter, and How Much?," NBER Working Papers 9125, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
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