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The low but uncertain measured benefits of US water quality policy


  • David A. Keiser

    () (Department of Economics, Iowa State University, Ames, IA 50011; Center for Agricultural and Rural Development, Iowa State University, Ames, IA 50011)

  • Catherine L. Kling

    (Charles H. Dyson School of Applied Economics and Management, Cornell University, Ithaca, NY 14853)

  • Joseph S. Shapiro

    (Department of Agricultural and Resource Economics, University of California, Berkeley, CA 94720; National Bureau of Economic Research, Cambridge, MA 02138)


US investment to decrease pollution in rivers, lakes, and other surface waters has exceeded $1.9 trillion since 1960, and has also exceeded the cost of most other US environmental initiatives. These investments come both from the 1972 Clean Water Act and the largely voluntary efforts to control pollution from agriculture and urban runoff. This paper reviews the methods and conclusions of about 20 recent evaluations of these policies. Surprisingly, most analyses estimate that these policies’ benefits are much smaller than their costs; the benefit–cost ratio from the median study is 0.37. However, existing evidence is limited and undercounts many types of benefits. We conclude that it is unclear whether many of these regulations truly fail a benefit–cost test or whether existing evidence understates their net benefits; we also describe specific questions that when answered would help eliminate this uncertainty.

Suggested Citation

  • David A. Keiser & Catherine L. Kling & Joseph S. Shapiro, 2019. "The low but uncertain measured benefits of US water quality policy," Proceedings of the National Academy of Sciences, Proceedings of the National Academy of Sciences, vol. 116(12), pages 5262-5269, March.
  • Handle: RePEc:nas:journl:v:116:y:2019:p:5262-5269

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    References listed on IDEAS

    1. McGartland, Al, 2013. "Thirty Years of Economics at the Environmental Protection Agency," Agricultural and Resource Economics Review, Cambridge University Press, vol. 42(3), pages 436-452, December.
    2. Sheila M. Olmstead, 2010. "The Economics of Water Quality," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 4(1), pages 44-62, Winter.
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    Cited by:

    1. Weng, Weizhe & Cobourn, Kelly M. & Kemanian, Armen R. & Boyle, Kevin J. & Shi, Yuning & Stachelek, Joseph & White, Charles, 2020. "Quantifying Co-Benefits of Water Quality Policies: An Integrated Assessment Model of Nitrogen Management," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304667, Agricultural and Applied Economics Association.


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