Record Display for the EPA National Library Catalog


Main Title When do firms shift production across states to avoid environmental regulation?
Author Gray, Wayne B.
Other Authors
Author Title of a Work
Shadbegian, Ronald J.
Publisher National Center for Environmental Economics,
Year Published 2002
OCLC Number 57253332
Subjects Industrial location--United States ; Industrial productivity--United States ; Paper mills--United States ; Oil industries--United States ; Environmental law--United States--States--Compliance costs
Internet Access
Description Access URL
Library Call Number Additional Info Location Last
EJBD  HC79.E5N386 2002-02 Headquarters Library/Washington,DC 12/17/2004
Collation 36 p. ; 22 cm.
"January 2002." Title from the resource itself. Description based on content as of: March 2002. This paper examines whether a firms allocation of production across its plants responds to the environmental regulation faced by those plants, as measured by differences in stringency across states. We also test whether sensitivity to regulation differs based on differences across firms in compliance behavior and/or differences across states in industry importance and concentration. We use Census data for the paper and oil industries to measure the share of each state in each firm's production during the 1967-1992 period. We use several measures of state environmental stringency and test for interactions between regulatory stringency and three factors: the firms overall compliance rate, a Herfindahl index of industry concentration in the state, and the industrys share in the state economy. We find significant results for the paper industry: firms allocate smaller production shares to states with stricter regulations. This impact is concentrated among firms with low compliance rates, suggesting that low compliance rates are due to high compliance costs, not low compliance benefits. The interactions between stringency and industry characteristics are less often significant, but suggest that the paper industry is more affected by regulation where it is larger or more concentrated. Our results are weaker for the oil industry, reflecting either less opportunity to shift production across states or a greater impact of environmental regulation on paper mills. Includes bibliographical references (p. 27-28).