Papers Containing Keywords(s): 'regulation'
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Viewing papers 11 through 20 of 48
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Working PaperEnergy Prices, Pass-Through, and Incidence in U.S. Manufacturing*
January 2016
Working Paper Number:
CES-16-27
This paper studies how increases in energy input costs for production are split between consumers and producers via changes in product prices (i.e., pass-through). We show that in markets characterized by imperfect competition, marginal cost pass-through, a demand elasticity, and a price-cost markup are suffcient to characterize the relative change in welfare between producers and consumers due to a change in input costs. We and that increases in energy prices lead to higher plant-level marginal costs and output prices but lower markups. This suggests that marginal cost pass-through is incomplete, with estimates centered around 0.7. Our confidence intervals reject both zero pass-through and complete pass-through. We and heterogeneous incidence of changes in input prices across industries, with consumers bearing a smaller share of the burden than standards methods suggest.View Full Paper PDF
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Working PaperThe Impact of Bank Credit on Labor Reallocation and Aggregate Industry Productivity
January 2016
Working Paper Number:
CES-16-26
Using a difference-in-difference methodology, we find that the state-level deregulation of local U.S. banking markets leads to significant increases in the reallocation of labor within local industries towards small firms with higher marginal products of labor. Using plant-level data, we propose and examine an approach that quantifies the industry productivity gains from labor reallocation and find that these gains are economically important. Our analysis suggests that labor reallocation is a significant channel through which local banking markets affect the aggregate productivity and performance of local industries.View Full Paper PDF
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Working PaperOFFSHORING POLLUTION WHILE OFFSHORING PRODUCTION*
January 2016
Working Paper Number:
CES-16-09R
We examine the role of firm strategy in the global combat against pollution. We find that U.S. plants release less toxic emissions when their parent firm imports more from low-wage countries (LWCs). Consistent with the Pollution Haven Hypothesis, goods imported by U.S. firms from LWCs are in more pollution-intensive industries; U.S. plants shift production to less pollution-intensive industries, produce less waste, and spend less on pollution abatement when their parent imports more from LWCs. The negative impact of LWC imports on emissions is stronger for U.S. plants located in counties with greater institutional pressure for environmental performance, but weaker for more-capable U.S. plants and firms. These results highlight the role of local institutions and firm capability in explaining firms' choice of offshoring and environmental strategy.View Full Paper PDF
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Working PaperThe Impact of Heterogeneous NOx Regulations on Distributed Electricity Generation in U.S. Manufacturing
April 2015
Working Paper Number:
CES-15-12
The US EPA's command-and-control NOx policies of the early 1990s are associated with a 3.1 percentage point reduction in the likelihood of manufacturing plants vertically integrating the electricity generation process. During the same period California adopted a cap-and-trade program for NOx emissions that resulted in no significant impact on distributed electricity generation in manufacturing. These results suggest that traditional command-and-control approaches to air pollution may exacerbate other market failures such as the energy efficiency gap, because distributed generation is generally recognized as a more energy efficient means of producing electricityView Full Paper PDF
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Working PaperWhy is Pollution from U.S. Manufacturing Declining? The Roles of Environmental Regulation, Productivity, and Trade
January 2015
Working Paper Number:
CES-15-03R
Between 1990 and 2008, air pollution emissions from U.S. manufacturing fell by 60 percent despite a substantial increase in manufacturing output. We show that these emissions reductions are primarily driven by within-product changes in emissions intensity rather than changes in output or in the composition of products produced. We then develop and estimate a quantitative model linking trade with the environment to better understand the economic forces driving these changes. Our estimates suggest that the implicit pollution tax that manufacturers face doubled between 1990 and 2008. These changes in environmental regulation, rather than changes in productivity and trade, account for most of the emissions reductions.View Full Paper PDF
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Working PaperRANDOMIZED SAFETY INSPECTIONS AND RISK EXPOSURE ON THE JOB: QUASI-EXPERIMENTAL ESTIMATES OF THE VALUE OF A STATISTICAL LIFE
January 2014
Working Paper Number:
CES-14-05
Compensating wages for workplace fatality and accident risks are used to infer the value of a statistical life (VSL), which in turn is used to assess the benefits of human health and safety regulations. The estimation of these wage differentials, however, has been plagued by measurement error and omitted variables. This paper employs the first quasi-experimental design within a labor market setting to overcome such limitations in the ex-tant literature. Specifically, randomly assigned, exogenous federal safety inspections are used to instrument for plant-level risks and combined with confidential U.S. Census data on manufacturing employment to estimate the VSL using a difference-in-differences framework. The VSL is estimated to be between $2 and $4 million ($2011), suggesting prior studies may substantially overstate the value workers place on safety, and therefore, the benefits of health and safety regulations.View Full Paper PDF
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Working PaperEnvironmental Regulation, Abatement, and Productivity: A Frontier Analysis
September 2013
Working Paper Number:
CES-13-51
This research studies the link between environmental regulation and plant level productivity in two U.S. manufacturing industries: pulp and paper mills and oil refineries using Data Envelopment Analysis (DEA) models. Data on abatement spending, emissions and abated emissions are used in different DEA models to study plant productivity outcomes when accounting for abatement spending or emissions regulations. Results indicate that pulp and paper mills and oil refineries in the U.S. suffered decreases in productivity due to pollution abatement activities from 1974 to 2000. These losses in productivity are substantial but have been slowly trending downwards even when the regulations have tended to become more stringent and emission of pollutants has declined suggesting that the best practice has shifted over time. Results also show that the reported abatement expenditures are not able to explain all the losses arising out of regulation suggesting that these abatement expenditures are consistently under-reported.View Full Paper PDF
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Working PaperDo EPA Regulations Affect Labor Demand? Evidence From the Pulp and Paper Industry
August 2013
Working Paper Number:
CES-13-39
The popular belief is that environmental regulation must reduce employment, since suchregulations are expected to increase production costs, which would raise prices and thus reducedemand for output, at least in a competitive market. Although this effect might seem obvious, a careful microeconomic analysis shows that it is not guaranteed. Even if environmental regulation reduces output in the regulated industry, abating pollution could require additional labor (e.g. to monitor the abatement capital and meet EPA reporting requirements). It is also possible for pollution abatement technologies to be labor enhancing. In this paper we analyze how a particular EPA regulation, the so-called 'Cluster Rule' (CR) imposed on the pulp and paper industry in 2001, affected employment in that sector. Using establishment level data from the Census of Manufacturers and Annual Survey of Manufacturers at the U.S. Census Bureau from 1992-2007 we find evidence of small employment declines (on the order of 3%-7%), which are sometimes statistically significant, at a subset of the plants covered by the CR.View Full Paper PDF
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Working PaperENVIRONMENTAL REGULATION AND INDUSTRY EMPLOYMENT: A REASSESSMENT
July 2013
Working Paper Number:
CES-13-36
This paper examines the impact of environmental regulation on industry employment, using a structural model based on data from the Census Bureau's Pollution Abatement Costs and Expenditures Survey. This model was developed in an earlier paper (Morgenstern, Pizer, and Shih (2002) - MPS). We extend MPS by examining additional industries and additional years. We find widely varying estimates across industries, including many implausibly large positive employment effects. We explore several possible explanations for these results, without reaching a satisfactory conclusion. Our results call into question the frequent use of the average impacts estimated by MPS as a basis for calculating the quantitative impacts of new environmental regulations on employment.View Full Paper PDF
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Working PaperEVIDENCE OF AN 'ENERGY-MANAGEMENT GAP' IN U.S. MANUFACTURING: SPILLOVERS FROM FIRM MANAGEMENT PRACTICES TO ENERGY EFFICIENCY
April 2013
Working Paper Number:
CES-13-25
In this paper we merge a well-cited survey of firm management practices into confidential U.S. Census microdata to examine whether generic, i.e. non-energy specific, firm management practices, 'spillover' to enhance energy efficiency in the United States. We find the relationship in U.S. plants to be more nuanced than past research on UK plants has suggested. Most management techniques have beneficial spillovers to energy efficiency, but an emphasis on generic targets, conditional on other management practices, results in spillovers that increase energy intensity. Our specification controls for industry specific effects at a detailed 6-digit NAICS level and shows that this result is stronger for firms in energy intensive industries. We interpret the empirical result that generic management practices do not necessarily spillover to improved energy performance as evidence of an 'energy management gap.'View Full Paper PDF
