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Unbundling Technology Adoption and tfp at the Firm Level. Do Intangibles Matter?

  • Y.H. Farzin

    (Department of Agricultural and Resource Economics, University of California)

  • C.A. Bond

    (RAND Corporation)

When it comes to environmental quality preferences, it is popularly believed that Democrats (and more generally, liberals) are “green” while Republicans” (conservatives) are “brown”. Does empirical evidence support this popular belief? We test the hypothesis that regional political identification leads to differences in concentration outcomes for several measures of California air pollution indicators, including CO, NO2, SO2, O3, PM10, and PM2.5 concentrations. We employ two alternative identification strategies on county-level cluster and year panel data that include proxy variables for political party preferences of the local populace, as well as controlling for the political party affiliations at the state-level legislative and executive branches. In general, we do not find a consistent and statistically significant relationship between pollution outcomes and political variables for California. The popular belief is empirically supported only for NO2 and O3, but not for any of the other pollutants, and even in these two cases the relationship only holds at the local regulatory level and not at the state policymaking level. At the state level, for most of the pollutants no significant effect of party affiliation is identified, and in the rare cases where such an effect exists, it is either too weak to be conclusive or is even counter to popular belief.

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Paper provided by Fondazione Eni Enrico Mattei in its series Working Papers with number 2012.97.

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Date of creation: Dec 2012
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Handle: RePEc:fem:femwpa:2012.97
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  1. Kahn, Matthew E., 2007. "Do greens drive Hummers or hybrids? Environmental ideology as a determinant of consumer choice," Journal of Environmental Economics and Management, Elsevier, vol. 54(2), pages 129-145, September.
  2. Pashigian, B Peter, 1985. "Environmental Regulation: Whose Self-interests Are Being Protected?," Economic Inquiry, Western Economic Association International, vol. 23(4), pages 551-84, October.
  3. Lopez, Ramon & Mitra, Siddhartha, 2000. "Corruption, Pollution, and the Kuznets Environment Curve," Journal of Environmental Economics and Management, Elsevier, vol. 40(2), pages 137-150, September.
  4. Khan, M. & Matsusaka, J.G., 1995. "Demand for Environment Goods: Evidence from Voting Patterns on California Initiatives," Discussion Papers 1995_08, Columbia University, Department of Economics.
  5. Becker, Gary S, 1983. "A Theory of Competition among Pressure Groups for Political Influence," The Quarterly Journal of Economics, MIT Press, vol. 98(3), pages 371-400, August.
  6. Farzin, Y H, 2003. "The Effects of Emissions Standards on Industry," Journal of Regulatory Economics, Springer, vol. 24(3), pages 315-27, November.
  7. B. Mak Arvin & Byron Lew, 2009. "Does democracy affect environmental quality in developing countries?," Applied Economics, Taylor & Francis Journals, vol. 43(9), pages 1151-1160.
  8. Meilanie Buitenzorgy & Arthur P. J. Mol, 2011. "Does Democracy Lead to a Better Environment? Deforestation and the Democratic Transition Peak," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 48(1), pages 59-70, January.
  9. Y. H. Farzin, 2004. "Can Stricter Environmental Standards Benefit the Industry and Enhance Welfare," Annales d'Economie et de Statistique, ENSAE, issue 75-76, pages 223-255.
  10. Ross McKitrick, 2006. "The politics of pollution: party regimes and air quality in Canada," Canadian Journal of Economics, Canadian Economics Association, vol. 39(2), pages 604-620, May.
  11. Farzin, Y. Hossein & Bond, Craig A., 2006. "Democracy and environmental quality," Journal of Development Economics, Elsevier, vol. 81(1), pages 213-235, October.
  12. Arellano, Manuel, 2003. "Panel Data Econometrics," OUP Catalogue, Oxford University Press, number 9780199245291, March.
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