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Effects of Air Quality Regulation

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  • Henderson, J Vernon

Abstract

This paper examines the effects of ground-level ozone regulation on economic activity. Regulatory effort varies by county attainment status and state attitudes. A switch from attainment to nonattainment status induces greater local regulatory effort, leading to air quality improvement, ceteris paribus, and an exit of polluting industries. Polluting industries spread out, moving from nonattainment (polluted) to attainment (initially less polluted) areas. Localities can improve hourly extreme-value readings, which trigger regulatory activity, without improving measures of typical conditions(for example, daily medians) by spreading economic activity over the day to dampen daily ozone peaks. Copyright 1996 by American Economic Association.

Suggested Citation

  • Henderson, J Vernon, 1996. "Effects of Air Quality Regulation," American Economic Review, American Economic Association, vol. 86(4), pages 789-813, September.
  • Handle: RePEc:aea:aecrev:v:86:y:1996:i:4:p:789-813
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    References listed on IDEAS

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    1. Henderson, Vernon, 1997. "Externalities and Industrial Development," Journal of Urban Economics, Elsevier, vol. 42(3), pages 449-470, November.
    2. Wayne B Gray & Ronald J Shadbegian, 1993. "Environmental Regulation And Manufacturing Productivity At The Plant Level," Working Papers 93-6, Center for Economic Studies, U.S. Census Bureau.
    3. Deily, Mary E. & Gray, Wayne B., 1991. "Enforcement of pollution regulations in a declining industry," Journal of Environmental Economics and Management, Elsevier, vol. 21(3), pages 260-274, November.
    4. Gary Chamberlain, 1980. "Analysis of Covariance with Qualitative Data," Review of Economic Studies, Oxford University Press, vol. 47(1), pages 225-238.
    5. Portney, Paul R, 1990. "Economics and the Clean Air Act," Journal of Economic Perspectives, American Economic Association, vol. 4(4), pages 173-181, Fall.
    6. Scott E. Atkinson & T. H. Tietenberg, 1987. "Economic Implications of Emissions Trading Rules for Local and Regional Pollutants," Canadian Journal of Economics, Canadian Economics Association, vol. 20(2), pages 370-386, May.
    7. Roumasset, James A. & Smith, Kirk R., 1990. "Exposure trading: An approach to more efficient air pollution control," Journal of Environmental Economics and Management, Elsevier, vol. 18(3), pages 276-291, May.
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    More about this item

    JEL classification:

    • H00 - Public Economics - - General - - - General
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy

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