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Evidence that the accuracy of self-reported lead emissions data improved: A puzzle and discussion

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  • Sammy Zahran

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  • Terrence Iverson
  • Stephan Weiler
  • Anthony Underwood

Abstract

We investigate the accuracy of facility-reported data both within and across emissions and off-site transfer inventories of lead (Pb) in time. We build on recent work using Benford’s Law to detect statistical anomalies in large data sets. Our application exploits a regulatory experiment to test for systematic changes in firm behavior triggered by the 2001 implementation of the Final Rule, a major regulatory change governing the U.S. Environmental Protection Agency’s (EPA) oversight of lead emissions. Statistical results show that the EPA’s Final Rule functioned to significantly improve the accuracy of facility-reported lead data. This finding is surprising because abatement requirements increased and both the probability of firm audit and expected penalties for misreporting apparently decreased in the post-Final Rule period. To explain this counterintuitive result we develop a reporting model for the firm. We argue that organizational investments made in response to specific requirements of the Final Rule, as well as rising public awareness of the risks of lead, may have induced firms to report more accurately. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Sammy Zahran & Terrence Iverson & Stephan Weiler & Anthony Underwood, 2014. "Evidence that the accuracy of self-reported lead emissions data improved: A puzzle and discussion," Journal of Risk and Uncertainty, Springer, vol. 49(3), pages 235-257, December.
  • Handle: RePEc:kap:jrisku:v:49:y:2014:i:3:p:235-257
    DOI: 10.1007/s11166-014-9204-1
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    References listed on IDEAS

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    Cited by:

    1. Bizet, Romain & Bonev, Petyo & Leveque, Francois, 2020. "The effect of local monitoring on nuclear safety and compliance: Evidence from France," Economics Working Paper Series 2014, University of St. Gallen, School of Economics and Political Science.
    2. Matthew A. Cole & David J. Maddison & Liyun Zhang, 2020. "Testing the emission reduction claims of CDM projects using the Benford’s Law," Climatic Change, Springer, vol. 160(3), pages 407-426, June.
    3. Louie Rivers & Tamara Dempsey & Jade Mitchell & Carole Gibbs, 2015. "Environmental Regulation and Enforcement: Structures, Processes and the Use of Data for Fraud Detection," Journal of Environmental Assessment Policy and Management (JEAPM), World Scientific Publishing Co. Pte. Ltd., vol. 17(04), pages 1-29, December.

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    More about this item

    Keywords

    Lead emissions; Final Rule 2001; Benford’s law; Toxic release inventory; Self-regulation; Q53; Q58; K32; K42;
    All these keywords.

    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
    • K32 - Law and Economics - - Other Substantive Areas of Law - - - Energy, Environmental, Health, and Safety Law
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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