Muck
Parties, Politics, and Regulation: Evidence from Clean Air Act Enforcement
Robert Innes & Arnab Mitra
Economic Inquiry, January 2015, Pages 522–539
Abstract:
Does local Federal regulation respond to the preferences of local Congressional representatives? For example, do Republican Congressmen reduce local enforcement of Clean Air laws in their districts? We use facility-level panel data on Clean Air Act inspections over 1989–2005 to study the causal effect of a Congressman's party affiliation on local enforcement. Random assignment of electoral outcomes is obtained with a Regression Discontinuity design. We find that new Republican (vs. Democratic) Representatives significantly depress inspection rates for local polluting facilities in the first year after their election.
---------------------
Acting green elicits a literal warm glow
Danny Taufik, Jan Willem Bolderdijk & Linda Steg
Nature Climate Change, January 2015, Pages 37–40
Abstract:
Environmental policies are often based on the assumption that people only act environmentally friendly if some extrinsic reward is implicated, usually money. We argue that people might also be motivated by intrinsic rewards: doing the right thing (such as acting environmentally friendly) elicits psychological rewards in the form of positive feelings, a phenomenon known as warm glow. Given the fact that people’s psychological state may affect their thermal state, we expected that this warm glow could express itself quite literally: people who act environmentally friendly may perceive the temperature to be higher. In two studies, we found that people who learned they acted environmentally friendly perceived a higher temperature than people who learned they acted environmentally unfriendly. The underlying psychological mechanism pertains to the self-concept: learning you acted environmentally friendly signals to yourself that you are a good person. Together, our studies show that acting environmentally friendly can be psychologically rewarding, suggesting that appealing to intrinsic rewards can be an alternative way to encourage pro-environmental actions.
---------------------
How Much Energy Do Building Energy Codes Really Save? Evidence from California
Arik Levinson
NBER Working Paper, December 2014
Abstract:
Construction codes that regulate the energy efficiency of new buildings have been a centerpiece of US environmental policy for 40 years. California enacted the nation’s first energy building codes in 1978, and they were projected to reduce residential energy use — and associated pollution — by 80 percent. How effective have the building codes been? I take three approaches to answering that question. First, I compare current electricity use by California homes of different vintages constructed under different standards, controlling for home size, local weather, and tenant characteristics. Second, I examine how electricity in California homes varies with outdoor temperatures for buildings of different vintages. And third, I compare electricity use for buildings of different vintages in California, which has stringent building energy codes, to electricity use for buildings of different vintages in other states. All three approaches yield the same answer: there is no evidence that homes constructed since California instituted its building energy codes use less electricity today than homes built before the codes came into effect.
---------------------
Rational Inattention and Energy Efficiency
James Sallee
Journal of Law and Economics, August 2014, Pages 781-820
Abstract:
This paper argues that it will often be rational for consumers to pay limited attention to energy efficiency when choosing among energy-consuming durable goods like automobiles or home appliances. The reason is that the proper valuation of energy efficiency requires time and effort, but differences in efficiency across products will rarely be pivotal to choice when consumers have strong preferences regarding other product attributes. The paper first explains why proper valuation of efficiency is difficult, even in the presence of government energy labels. It next develops a model that shows how to value additional information about energy efficiency in a discrete-choice context. It then uses data on automobiles to show that consumers experience only small welfare losses when forced to choose a car without detailed information about fuel costs. Finally, the paper discusses the implications of rational inattention for both economic research and public policy.
---------------------
Perception of Gasoline Taxes and Driver Cost: Implications for Highway Finance
Ronald Fisher & Robert Wassmer
Michigan State University Working Paper, December 2014
Abstract:
This research compares the actual magnitude of fuel taxes to the perceptions of these amounts. The issue is whether misperceptions about fuel taxes are contributing to voter perspectives about transportation finance and investment issues. A survey of likely Michigan voters shows that taxpayers greatly overestimate the amount they pay in fuel taxes. Half of the respondents (voters) overestimate the magnitude by at least a factor of five, and three-quarters overestimate the magnitude by at least a factor of three. Logistic regression analysis shows that voter (mis)perceptions regarding the magnitude of state fuel taxes do affect their views regarding highway revenue and investment proposals.
---------------------
Who Benefits from Environmental Regulation? Evidence from the Clean Air Act Amendments
Antonio Bento, Matthew Freedman & Corey Lang
Review of Economics and Statistics, forthcoming
Abstract:
Using geographically disaggregated data and exploiting an instrumental variable strategy, we show that, contrary to conventional wisdom, the benefits of the 1990 Clean Air Act Amendments (CAAA) were progressive. The CAAA created incentives for local regulators to target the initially dirtiest areas for cleanup, creating heterogeneity in the incidence of air quality improvements that favored lower-income households. Based on house price appreciation, households in the lowest quintile of the income distribution received annual benefits from the program equal to 0.3% of their income on average during the 1990s, over twice as much as those in the highest quintile.
---------------------
The value of environmental status signaling
Michael Delgado, Jessica Harriger & Neha Khanna
Ecological Economics, March 2015, Pages 1–11
Abstract:
How much are consumers willing to pay to signal their environmental consciousness? We identify the signaling value of an environmental public good by focusing on hybrid cars and exploiting the physical uniqueness of the Toyota Prius relative to hybrids that look identical to their non-hybrid counterparts. We deploy a quasi-experimental hedonic model to estimate this willingness to pay. We find that, controlling for observable and unobservable factors, the Prius commands an environmental signaling value of $587 or 4.5% of its value. Our research provides lessons for economists and policymakers, and contributes to the literature on identifying signaling values.
---------------------
Indoor air quality and academic performance
Tess Stafford
Journal of Environmental Economics and Management, March 2015, Pages 34–50
Abstract:
I examine the effect of school indoor air quality (IAQ) on academic outcomes. I utilize a quasi-natural experiment, in which IAQ-renovations were completed at virtually every school in a single Texas school district at different points in time, combined with a panel of student-level data to control for many confounding factors and thereby uncover the causal effect of IAQ-renovations on academic outcomes. Results indicate that performance on standardized tests significantly improves while attendance is unresponsive to improvements in IAQ. Rough calculations suggest that IAQ-renovations may be a more cost-effective way to improve standardized test scores than class size reductions.
---------------------
Property Rights and Choice: The Case of The Fishery
Jorge Holzer
American Journal of Agricultural Economics, forthcoming
Abstract:
Formal property rights are typically established after considerable waste has occurred, despite the effectiveness of such schemes in addressing the inefficiencies of common pool resources. Adoption can be contentious because of the assignment of wealth and political influence that accompany the transition to exclusive property rights. This paper studies how the early involvement of harvesters in policy implementation designed to address the commons’ inefficiency may foster perceived legitimacy and lessen political opposition to the establishment of individual property rights. We demonstrate that it is optimal for a manager facing industry strife and reform delay to allow firms to self-select into the property rights regime. The strategic interaction of harvesters leads to an equilibrium characterized by the global adoption of property rights. Thus, by providing harvesters with a choice between management systems, policy makers can reduce the transaction costs associated with the need to create political consensus, while ensuring an outcome similar to the top-down implementation of market-based management. Evidence is provided from a recent policy change in Maryland fisheries in which the provision of a choice resulted in the overwhelming adoption of individual transferable quotas and the end of the race to fish.
---------------------
Joseph Shapiro & Reed Walker
NBER Working Paper, January 2015
Abstract:
Between 1990 and 2008, emissions of the most common air pollutants from U.S. manufacturing fell by 60 percent, even as real U.S. manufacturing output grew substantially. This paper develops a quantitative model to explain how changes in trade, environmental regulation, productivity, and consumer preferences have contributed to these reductions in pollution emissions. We estimate the model’s key parameters using administrative data on plant-level production and pollution decisions. We then combine these estimates with detailed historical data to provide a model-driven decomposition of the causes of the observed pollution changes. Finally, we compare the model-driven decomposition to a statistical decomposition. The model and data suggest three findings. First, the fall in pollution emissions is due to decreasing pollution per unit output within narrowly defined products, rather than to changes in the types of products produced or changes to the total quantity of manufacturing output. Second, the implicit pollution tax that rationalizes firm production and abatement behavior more than doubled between 1990 and 2008. Third, environmental regulation explains 75 percent or more of the observed reduction in pollution emissions from manufacturing.
---------------------
Environmental Policy and Vehicle Safety: The Impact of Gasoline Taxes
Damien Sheehan-Connor
Economic Inquiry, forthcoming
Abstract:
Policies to reduce carbon emissions by vehicles, such as fuel economy standards and gasoline taxes, have impacts on vehicle weight and thus on safety. This paper develops a model that separately identifies the impact of vehicle weight on mortality and selection effects that impact accident propensity. The main results are that (1) the safety externalities associated with heavy vehicles are greater than the environmental ones; (2) under fuel economy standards, vehicle weights have recently decreased with little likely effect on accident deaths; and (3) similar environmental benefits could be combined with substantial reductions in deaths by implementing higher gasoline taxes.
---------------------
Advertising Energy Saving Programs: The Potential Environmental Cost of Emphasizing Monetary Savings
Daniel Schwartz et al.
Journal of Experimental Psychology: Applied, forthcoming
Abstract:
Many consumers have monetary or environmental motivations for saving energy. Indeed, saving energy produces both monetary benefits, by reducing energy bills, and environmental benefits, by reducing carbon footprints. We examined how consumers’ willingness and reasons to enroll in energy-savings programs are affected by whether advertisements emphasize monetary benefits, environmental benefits, or both. From a normative perspective, having 2 noteworthy kinds of benefit should not decrease a program’s attractiveness. In contrast, psychological research suggests that adding external incentives to an intrinsically motivating task may backfire. To date, however, it remains unclear whether this is the case when both extrinsic and intrinsic motivations are inherent to the task, as with energy savings, and whether removing explicit mention of extrinsic motivation will reduce its importance. We found that emphasizing a program’s monetary benefits reduced participants’ willingness to enroll. In addition, participants’ explanations about enrollment revealed less attention to environmental concerns when programs emphasized monetary savings, even when environmental savings were also emphasized. We found equal attention to monetary motivations in all conditions, revealing an asymmetric attention to monetary and environmental motives. These results also provide practical guidance regarding the positioning of energy-saving programs: emphasize intrinsic benefits; the extrinsic ones may speak for themselves.
---------------------
Thinking about time as money decreases environmental behavior
Ashley Whillans & Elizabeth Dunn
Organizational Behavior and Human Decision Processes, March 2015, Pages 44–52
Abstract:
Surprisingly, Americans are no more likely to engage in environmental behavior today than 20 years ago. A novel explanation for this pattern may lie in the increased tendency to see time as money. Using large-scale survey data, we show that people are less likely to engage in environmental behavior if they are paid by the hour, a form of compensation that leads people to see their time as money. Using experimental methodology, we show that making the economic value of time salient reduces environmental intentions and behavior. This occurs in part because thinking about the economic value of time creates awareness of the opportunity costs associated with environmental behavior. We mitigate these effects by reframing environmental behavior as an act consistent with self-interest. Together, this research suggests that viewing time as money shapes environmental decisions, potentially shedding light on patterns of environmental behavior across time and around the world.
---------------------
Nonprice incentives and energy conservation
Omar Asensio & Magali Delmas
Proceedings of the National Academy of Sciences, forthcoming
Abstract:
In the electricity sector, energy conservation through technological and behavioral change is estimated to have a savings potential of 123 million metric tons of carbon per year, which represents 20% of US household direct emissions in the United States. In this article, we investigate the effectiveness of nonprice information strategies to motivate conservation behavior. We introduce environment and health-based messaging as a behavioral strategy to reduce energy use in the home and promote energy conservation. In a randomized controlled trial with real-time appliance-level energy metering, we find that environment and health-based information strategies, which communicate the environmental and public health externalities of electricity production, such as pounds of pollutants, childhood asthma, and cancer, outperform monetary savings information to drive behavioral change in the home. Environment and health-based information treatments motivated 8% energy savings versus control and were particularly effective on families with children, who achieved up to 19% energy savings. Our results are based on a panel of 3.4 million hourly appliance-level kilowatt–hour observations for 118 residences over 8 mo. We discuss the relative impacts of both cost-savings information and environmental health messaging strategies with residential consumers.
---------------------
Property Rights, Regulatory Capture, and Exploitation of Natural Resources
Christopher Costello & Corbett Grainger
NBER Working Paper, January 2015
Abstract:
We study how the strength of property rights to individual extractive firms affects a regulator’s choice over exploitation rates for a natural resource. The regulator is modeled as an intermediary between current and future resource harvesters, rather than between producers and consumers, as in the traditional regulatory capture paradigm. When incumbent resource users have weak property rights, they have an incentive to pressure the regulator to allow resource extraction at an inefficiently rapid rate. In contrast, when property rights are strong, this incentive is minimized or eliminated. We build a theoretical model in which different property right institutions can be compared for their incentives to exert influence on the regulator. The main theoretical prediction - that stronger individual property rights will lead the regulator to choose more economically efficient extraction paths - is tested empirically with a novel panel data set from global fisheries. Exploiting the variation in timing of catch share implementation in our panel data, we find that regulators are significantly more conservative in managing resources for which strong individual property rights have been assigned to firms; this is especially pronounced for resources that have been overexploited historically.
---------------------
Party differences and energy reform: Fiscal conservatism in the California legislature
David Hess et al.
Environmental Politics, forthcoming
Abstract:
Research building on political economy and ecological modernisation theories has paid increasing attention to the conditions that affect the prospects for environmental reform. Much work focuses on variation among political units in support of a single type of energy policy, whereas we examine within-state variation in support of a wide range of energy reform policies. Applying multilevel analyses to the 2011–2012 legislative session in California, we identify bill characteristics associated with divisions between Republicans and Democrats. Expanding the size or scope of government (through spending, government commissions, and business regulations) reduces support for energy reform among Republicans, whereas promoting transparency and other ‘good government’ initiatives reduces support among Democrats. In contrast with the standard view that Republicans oppose almost all energy reforms proposed by Democrats, we identify bill characteristics that increase the likelihood of support from both parties, namely tax reductions and credits, including for bills that promote renewable energy.
---------------------
How Will I Be Remembered? Conserving the Environment for the Sake of One’s Legacy
Lisa Zaval, Ezra Markowitz & Elke Weber
Psychological Science, forthcoming
Abstract:
Long time horizons and social distance are viewed as key psychological barriers to proenvironmental action, particularly regarding climate change. We suggest that these challenges can be turned into opportunities by making salient long-term goals and motives, thus shifting preferences between the present self and future others. We tested whether individuals’ motivation to leave a positive legacy can be leveraged to increase engagement with climate change and other environmental problems. In a pilot study, we found that individual differences in legacy motivation were positively associated with proenvironmental behaviors and intentions. In a subsequent experiment, we demonstrated that priming legacy motives increased donations to an environmental charity, proenvironmental intentions, and climate-change beliefs. Domain-general legacy motives represent a previously understudied and powerful mechanism for promoting proenvironmental behavior.
---------------------
Independent Labels? The Power behind Environmental Information about Products and Companies
Graham Bullock
Political Research Quarterly, forthcoming
Abstract:
Power is a ubiquitous term in political science, and yet the discipline lacks a metric of power that can be applied to both formal and informal political contexts. Building on past work on power and power resources, this paper develops a method to estimate the power of different actors over an organization. It uses this method to analyze the power of the public, private, and civil sectors within an original dataset of 245 cases of product and corporate environmental evaluations, such as ENERGY STAR, LEED Certification, and Newsweek’s Greenest Company Rankings. These initiatives have received limited attention from the political science literature, but they have become an increasingly prominent political phenomenon. The paper finds that the private and civil sectors likely have more power over these information-based governance initiatives than the public sector. It also reveals their lack of transparency and hybrid accountability relationships, which complicate their legitimacy and effectiveness.
---------------------
Anti-congestion policies in cities with public transportation
Akin Buyukeren & Tomoru Hiramatsu
Journal of Economic Geography, forthcoming
Abstract:
We study how congestion tolls and an urban growth boundary should be designed optimally in a monocentric city with both car and public transit commuting from the suburbs to the central city. The existing monocentric city literature has repeatedly shown that mitigating the congestion externality causes the densification of population toward the city center. In contrast, we find the opposite of densification can occur if public transit mode is present. Modal substitution effect limits the centralizing force of anti-congestion policies. In addition, redistributing tax revenues among residents generates a decentralizing effect by increasing housing demand because marginal utility of income is higher in suburbs. At the optimum, mitigating congestion can cause urban sprawl depending on degree of substitutability between automobile and public transit, relative congestibility of the two modes, tax revenue redistribution and preferences for location and lot size.
---------------------
Shahzeen Attari et al.
NBER Working Paper, December 2014
Abstract:
There is limited evidence of behavioral changes resulting from electricity information feedback. Using a randomized control trial from a New York apartment building, we study long-term effects of information feedback from “Modlet” in-home devices, which provide near-real-time plug-level information. We find a 12–23% decrease in electricity use for treatment apartments, concentrated among individuals reporting higher willingness-to-pay for an energy monitoring system. Decrease in overall electricity use is similar among treatment apartments which received Modlets and those which declined Modlets, and does not specifically occur for outlets with Modlets. This decrease may be due to a Hawthorne or salience effect.
---------------------
Raanan Raz et al.
Environmental Health Perspectives, forthcoming
Objective: To explore the association between maternal exposure to particulate matter (PM) air pollution and odds of ASD in her child.
Methods: We conducted a nested case-control study of participants in the Nurses’ Health Study II (NHS II), a prospective cohort of 116,430 US female nurses recruited in 1989, followed by biennial mailed questionnaires. Subjects were NHS II participants’ children born 1990-2002 with ASD (n=245), and children without ASD (n=1522) randomly selected using frequency matching for birth years. ASD was based on maternal report, which was validated against the Autism Diagnostic Interview-Revised in a subset. Monthly averages of PM with diameters ≤2.5 µm (PM2.5) and 2.5-10 µm (PM10-2.5) were predicted from a spatiotemporal model for the continental US and linked to residential addresses.
Results: PM2.5 exposure during pregnancy was associated with increased odds of ASD, with an adjusted odds ratio (OR) for ASD per interquartile range higher PM2.5 (4.42 µg/m3) of 1.57 (95% CI: 1.22, 2.03) among women with the same address before and after pregnancy (160 cases, 986 controls). Associations with PM2.5 exposure 9 months before or after the pregnancy were weaker in independent models and null when all three time periods were included, while the association with the 9 months of pregnancy remained (OR=1.63; 95% CI: 1.08-2.47). The association between ASD and PM2.5 was stronger for exposure during the third trimester (OR=1.42 per inter-quartile range increase in PM2.5, 95% CI: 1.09, 1.86) than other trimesters (ORs 1.06 and 1.00) when mutually adjusted. There was little association between PM10-2.5 and ASD.
Conclusions: Higher maternal exposure to PM2.5 during pregnancy, in particular the third trimester, was associated with greater odds of her child having ASD.
---------------------
Theodore Mansfield et al.
Risk Analysis, forthcoming
Abstract:
Since motor vehicles are a major air pollution source, urban designs that decrease private automobile use could improve air quality and decrease air pollution health risks. Yet, the relationships among urban form, air quality, and health are complex and not fully understood. To explore these relationships, we model the effects of three alternative development scenarios on annual average fine particulate matter (PM2.5) concentrations in ambient air and associated health risks from PM2.5 exposure in North Carolina's Raleigh-Durham-Chapel Hill area. We integrate transportation demand, land-use regression, and health risk assessment models to predict air quality and health impacts for three development scenarios: current conditions, compact development, and sprawling development. Compact development slightly decreases (−0.2%) point estimates of regional annual average PM2.5 concentrations, while sprawling development slightly increases (+1%) concentrations. However, point estimates of health impacts are in opposite directions: compact development increases (+39%) and sprawling development decreases (−33%) PM2.5-attributable mortality. Furthermore, compactness increases local variation in PM2.5 concentrations and increases the severity of local air pollution hotspots. Hence, this research suggests that while compact development may improve air quality from a regional perspective, it may also increase the concentration of PM2.5 in local hotspots and increase population exposure to PM2.5. Health effects may be magnified if compact neighborhoods and PM2.5 hotspots are spatially co-located. We conclude that compactness alone is an insufficient means of reducing the public health impacts of transportation emissions in automobile-dependent regions. Rather, additional measures are needed to decrease automobile dependence and the health risks of transportation emissions.
---------------------
Arrival of the Fukushima radioactivity plume in North American continental waters
John Smith et al.
Proceedings of the National Academy of Sciences, forthcoming
Abstract:
The large discharge of radioactivity into the northwest Pacific Ocean from the 2011 Fukushima Dai-ichi nuclear reactor accident has generated considerable concern about the spread of this material across the ocean to North America. We report here the first systematic study to our knowledge of the transport of the Fukushima marine radioactivity signal to the eastern North Pacific. Time series measurements of 134Cs and 137Cs in seawater revealed the initial arrival of the Fukushima signal by ocean current transport at a location 1,500 km west of British Columbia, Canada, in June 2012, about 1.3 y after the accident. By June 2013, the Fukushima signal had spread onto the Canadian continental shelf, and by February 2014, it had increased to a value of 2 Bq/m3 throughout the upper 150 m of the water column, resulting in an overall doubling of the fallout background from atmospheric nuclear weapons tests. Ocean circulation model estimates that are in reasonable agreement with our measured values indicate that future total levels of 137Cs (Fukushima-derived plus fallout 137Cs) off the North American coast will likely attain maximum values in the 3–5 Bq/m3 range by 2015–2016 before declining to levels closer to the fallout background of about 1 Bq/m3 by 2021. The increase in 137Cs levels in the eastern North Pacific from Fukushima inputs will probably return eastern North Pacific concentrations to the fallout levels that prevailed during the 1980s but does not represent a threat to human health or the environment.
---------------------
The Impact of LEED Neighborhood Certification on Condo Prices
Julia Freybote, Hua Sun & Xi Yang
Real Estate Economics, forthcoming
Abstract:
The U.S. Green Building Council offers LEED certification for existing and new neighborhood developments that meet sustainable urban development standards. Features of sustainable urban development have been found to positively affect residential sales prices. We investigate whether the intangible labeling effects of LEED neighborhood certification add a premium to the sales prices of LEED and non-LEED–certified condos. Using a quasi-experiment, transaction data from Portland, Oregon, and a spatio-temporal autoregressive (STAR) model, we find no evidence that the intangible labeling effects of LEED neighborhood certification directly or indirectly affect sales prices. Our results suggest that, contrary to LEED building certification, which we find adds a premium to condo sales prices, the LEED neighborhood label by itself fails to add value for condo buyers. Explanations for our findings include market acceptance, neighborhood delineation issues and the free rider problem as it relates to public goods.
---------------------
Proposed coal power plants and coal-to-liquids plants in the US: Which ones survive and why?
Dean Fantazzini & Mario Maggi
Energy Strategy Reviews, April 2014, Pages 9–17
Abstract:
The increase of oil and natural gas prices since the year 2000 stimulated the planning and construction of new coal-fired electricity generating plants and coal-to-liquids (CTL) plants in the US. However, many of these projects have been canceled or abandoned since 2007. Using a set of 145 proposed coal power plants and 25 CTL plants, the determinants that influence the decision to abandon a project or to proceed with it are examined using binary data models and 20 regressors. In the case of coal power plants, the number of searches performed on Google relating to coal power plants, the project duration and the prices of alternative fuels for electricity generation are found to be statistically significant at the 5% level. As for CTL plants, the political affiliation of the state governor is the only variable significant at the 5% level across several model specifications. An out-of-sample exercise confirms these findings. These results also hold with robustness checks considering alternative Google search keywords, the potential effects of the recession between 2008 and 2009 and the inclusion of the two dimensions of the Dynamic-Weighted Nominate (DWN) database.