Responsive Regulation: Target- Vs. Budget-Driven Regulation
Thursday, November 12, 2015
Riverfront South/Central (Hyatt Regency Miami)
*Names in bold indicate Presenter
The main purpose of this study is to examine the relationship between voluntary pollution abatement and prevention efforts at pulp and paper mills and regulatory stringency they face. Using facility level data on U.S. pulp and paper mills for 1989-2002, we estimate the negative binomial model to test the hypotheses of responsive regulation and whether regulators are driven by numerical pollution targets or budgetary constraints. We find that voluntary pollution abatement has greater impact on regulatory stringency than government expenditures. Additionally, state political pressure, pollution prevention (P2) legislation, firm and mill characteristics are found to be significant predictors of regulatory behavior.