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Third‐Party Certification And The Effectiveness Of Voluntary Pollution Abatement Programs: Evidence From Responsible Care

Author

Listed:
  • Martina Vidovic
  • Michael S. Delgado
  • Neha Khanna

Abstract

We analyze whether third‐party certification has been successful in improving the performance of voluntary pollution abatement in the Responsible Care (RC) program which made certification mandatory from 2005 onward. We use facility‐level panel data from 821 plants between 1996 and 2010, and exploit the change in the program requirements to estimate the causal impact of third‐party certification on participating facility emissions compared to non‐RC plants in the U.S. chemical industry. We address endogenous selection into RC via instrumental variables, and explore heterogeneity in the treatment effect. We find that, on average, there is no statistically discernible effect of third‐party certification on facility emissions, and that this result is robust to a variety of models that correspond to different assumptions related to identification. (JEL Q53, Q58, L60)

Suggested Citation

  • Martina Vidovic & Michael S. Delgado & Neha Khanna, 2019. "Third‐Party Certification And The Effectiveness Of Voluntary Pollution Abatement Programs: Evidence From Responsible Care," Economic Inquiry, Western Economic Association International, vol. 57(4), pages 1751-1770, October.
    • Handle: RePEc:bla:ecinqu:v:57:y:2019:i:4:p:1751-1770
    DOI: 10.1111/ecin.12818
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    2. Daniel Berliner & Aseem Prakash, 2014. "The United Nations Global Compact: An Institutionalist Perspective," Journal of Business Ethics, Springer, vol. 122(2), pages 217-223, June.
    3. Li, Huan & Khanna, Neha & Vidovic, Martina, 2014. "Third Party Certification and Self-Regulation: Evidence from Responsible Care and Accidents in the US Chemical Industry," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170492, Agricultural and Applied Economics Association.
    4. Huan Li & Neha Khanna & Martina Vidovic, 2018. "The effects of third party certification on voluntary self-regulation of accidents in the U.S. chemical industry," Journal of Regulatory Economics, Springer, vol. 53(3), pages 327-356, June.
    5. Li, Huan & Khanna, Neha, 2016. "Does Voluntary Regulation Provide Regulatory Relief? A Lesson from the Responsible Care Program," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235652, Agricultural and Applied Economics Association.

    More about this item

    JEL classification:

    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General

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