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Do Environmental Regulations Increase Construction Costs forFederal Aid Highways?: A Statistical Experiment

Author

Listed:
  • Smith, V. Kerry
  • Von Haefen, Roger
  • Zhu, Wei

Abstract

This paper uses the Federal Aid Highway program as the source for natural experiment to evaluate whether complying with federal environmental regulations increases construction costs. This is accomplished by evaluating whether indexes of the environmental resources in each state affect construction expenditures for Federal Aid highways from 1990 to 1994. Statistical analyses suggest that the expenditures for Federal Aid highway construction and repair were impacted by measures of the environment resources or the regulatory activities likely to be associated with environmental mandates. Similar models applied to construction expenditures for state roads did not find the proxy measures for federal regulations as positive influences on cost.

Suggested Citation

  • Smith, V. Kerry & Von Haefen, Roger & Zhu, Wei, 1998. "Do Environmental Regulations Increase Construction Costs forFederal Aid Highways?: A Statistical Experiment," Working Papers 98-09, Duke University, Department of Economics.
    • Handle: RePEc:duk:dukeec:98-09
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    More about this item

    JEL classification:

    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation

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