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Do OSHA Inspections Reduce Injuries? A Panel Analysis

Listed author(s):
  • Wayne B. Gray
  • John T. Scholz

Using data on injuries and OSHA inspections for 6,842 large manufacturing plants between 1979 and 1985, we find evidence that OSHA inspections significantly reduce injuries. This effect comes exclusively from inspections that impose penalties, inspections which do not impose penalties appear to have no effect on injuries. Plants which are inspected (and penalized) in a given year experience a 22 percent decline in their injuries during the following few years. In our sample, total OSHA enforcement is predicted to have reduced injuries by about 2 percent. We take advantage of the panel nature of our data to test for a number of potential biases: autocorrelated injuries, plant-specific fixed-effects which are correlated with both inspections and injuries, and endogeneity of inspections (injuries causing inspections). These biases lead us to use the percentage change in injuries, rather than injury levels, as the dependent variable for our estimation. Our analysis shows that the estimated effect of inspections on the percentage change in injuries is not significantly affected by these biases, and thus seems to reflect a 'deterrence' effect of OSHA inspections on injuries.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 3774.

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Date of creation: Jul 1991
Publication status: published as "Does Regulatory Enforcement Work? A Panel Analysis of OSHA Enforcement", Law and Society Review, vol. 27, no. 1, (June 1993) P. 177-213
Handle: RePEc:nbr:nberwo:3774
Note: LS
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  1. Wayne B. Gray & Carol Adaire Jones, 1989. "Longitudinal Patterns of Compliance with OSHA Health and Safety Regulations in the Manufacturing Sector," NBER Working Papers 3213, National Bureau of Economic Research, Inc.
  2. Feinstein, Jonathan S, 1989. "The Safety Regulation of U.S. Nuclear Power Plants: Violations, Inspections, and Abnormal Occurrences," Journal of Political Economy, University of Chicago Press, vol. 97(1), pages 115-154, February.
  3. John W. Ruser & Robert S. Smith, 1991. "Reestimating Osha's Effects: Have the Data Changed?," Journal of Human Resources, University of Wisconsin Press, vol. 26(2), pages 212-235.
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