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Effluent Limits, Ambient Quality, and Monitoring

Author

Listed:
  • Arguedas, Carmen

    (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.)

  • Earnhart, Dietrich

    (Department of Economics, University of Kansas)

  • Rousseau, Sandra

    (Center of Economic Studies, K.U.Leuven, Naamsestraat 69, B-3000 Leuven, Belgium,)

Abstract

Effluent limits are frequently based on a uniform emission standard, which applies to all polluting facilities within a single industry. However, the implementation of many environmental protection laws does not lead to uniform effluent limits due to considerations of local environmental conditions. In this paper, we theoretically examine the relationships among the stringency of effluent limits imposed on individual polluting facilities, environmental protection agencies’ monitoring decisions, and the ambient quality of the local environment. We then extend the theoretical analysis by exploring the establishment of effluent limits when (1) the national emission standard represents only an upper bound on the local issuance of limits and (2) negotiation efforts expended by both regulated polluting facilities and environmentally concerned citizens play a role. We find that the negotiated discharge limit depends on the political weight enjoyed and the negotiation effort costs faced by both citizens and the regulated facility, along with the stringency of the national standard and local ambient quality conditions.

Suggested Citation

  • Arguedas, Carmen & Earnhart, Dietrich & Rousseau, Sandra, 2013. "Effluent Limits, Ambient Quality, and Monitoring," Working Papers in Economic Theory 2013/08, Universidad Autónoma de Madrid (Spain), Department of Economic Analysis (Economic Theory and Economic History).
    • Handle: RePEc:uam:wpaper:201308
    as

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    File URL: http://www.uam.es/departamentos/economicas/analecon/especifica/mimeo/wp20138.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    effluent limits; monitoring; inspections; environmental permits; wastewater; compliance.;
    All these keywords.

    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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