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Measuring the effects of environmental regulations : the critical importance of a spatially disaggregated analysis

  • Auffhammer, Maximilian


    (University of California, Berkeley. Dept of agricultural and resource economics and policy)

  • Bento, Antonio M.
  • Lowe, Scott E

We examine the effects of the 1990 Clean Air Act Amendments (CAAA) on ambient concentrations of PM10 in the United States between 1990 and 2005. Consistent with prior literature, we find that non-attainment designation has no effect on the average monitor in non-attainment counties, after controlling for weather, socioeconomic characteristics at the county level and lagged concentrations. In sharp contrast, if we allow for heterogeneous treatment by type of monitor and county, we do find that the 1990 CAAA produced substantial effects. Our estimation results suggest that non-attainment counties with single monitors experienced a drop in concentrations of 10.5% relative to attainment counties. In non-attainment counties with multiple monitors, the overall effect of the regulation is an increase of ambient PM10 concentrations by 1.9%. The dirtiest monitors in these counties, however, experienced drops in PM10 of 6.1%, which suggest that regulators focus their attention on the dirtiest monitors.

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Paper provided by University of California at Berkeley, Department of Agricultural and Resource Economics and Policy in its series CUDARE Working Paper Series with number 1047.

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Length: 24 pages
Date of creation: 2007
Date of revision:
Handle: RePEc:are:cudare:1047
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  1. Kenneth Y. Chay & Michael Greenstone, 1998. "Does Air Quality Matter? Evidence from the Housing Market," NBER Working Papers 6826, National Bureau of Economic Research, Inc.
  2. Henderson, J Vernon, 1996. "Effects of Air Quality Regulation," American Economic Review, American Economic Association, vol. 86(4), pages 789-813, September.
  3. Greenstone, Michael, 2004. "Did the Clean Air Act cause the remarkable decline in sulfur dioxide concentrations?," Journal of Environmental Economics and Management, Elsevier, vol. 47(3), pages 585-611, May.
  4. Stengos, T. & Millimet, D.L. & List, J.A., 2002. "The Environmental Kuznets Curve: Real Progress or Misspecified Models?," Working Papers 2002-13, University of Guelph, Department of Economics and Finance.
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