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U.S. Trade in Toxics: The Case of Chlorodifluoromethane (HCFC-22)

Listed author(s):
  • Randy Becker
  • John Tang

This paper explores whether environmental regulation affects where pollution-intensive goods are produced. Here we examine chlorodifluoromethane (HCFC-22), a chemical designated as toxic in 1994 by the U.S. Environmental Protection Agency’s Toxics Release Inventory (TRI). Trends show a decline in the number of domestic producers of this chemical, a decline in the number of manufacturing facilities using it, and an increase in the number (and share) of facilities claiming to import it. Transaction-level trade data show an increase in the import of HCFC-22 imports since its TRI listing – an increase that is faster than that of all non-TRI listed chemicals. This is suggestive of a pollution haven effect. Meanwhile, we find that the vast majority of U.S. imports of HCFC-22 come from OECD countries. However, an increase in the share of imports from non-OECD countries since the chemical’s listing suggests a shift of production to countries with more lax environmental standards. While the findings here are suggestive of regulatory effects, more rigorous analyses are needed to rule out other possible explanations.

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File Function: First version, 2009
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Paper provided by Center for Economic Studies, U.S. Census Bureau in its series Working Papers with number 09-29.

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Length: 27 pages
Date of creation: Sep 2009
Handle: RePEc:cen:wpaper:09-29
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