Should You Turn Yourself In? The Consequences of Environmental Self-Policing
Facilities that self-police under the Environmental Protection AgencyÕs Audit Policy are eligible for reduced penalties on disclosed violations. This paper investigates whether self- policing has additional consequences, in particular whether self-policing reduces future enforcement activity. Using data on U.S. hazardous waste enforcement and disclosures, I find that facilities that self-police are rewarded with a lower probability of inspection in the future, although facilities with good compliance records may receive a smaller benefit than facilities with poor records. Additionally, facilities that are inspected frequently are more likely to disclose than facilities that face a low probability of inspection. The results suggest that facilities may be able to strategically disclose in order to decrease future enforcement.
|Date of creation:||23 Feb 2006|
|Date of revision:||13 Jun 2006|
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