Environmental Regulation and Labor Demand: The Northern Spotted Owl

Ann Ferris

No 201705, NCEE Working Paper Series from National Center for Environmental Economics, U.S. Environmental Protection Agency

Abstract: Environmental regulation can impact local labor markets, potentially reducing incomes and employment and inducing reallocation across sectors. The labor market consequences of environmental regulation are difficult to isolate because regulations frequently apply to large areas, such as the entire United States, and researchers cannot directly observe the counterfactual, in the absence of regulation. I claim that protection of the northern spotted owl in the Pacific Northwest in the 1990s led to an exogenous decline in labor demand in that region. I use this policy change to identify the local and regional impacts of endangered species regulation on employment and incomes in the timber industry. I estimate the local labor market impact of owl protection by comparing counties in the region with and without owl-protected areas. Depending on the choice of control areas and the inclusion of additional control factors, northern spotted owl protection plausibly led to a small loss of incomes and employment in the region.

Keywords: employment effects; labor market impacts; environmental policy (search for similar items in EconPapers)
JEL-codes: Q52 R11 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2017-09, Revised 2017-09
New Economics Papers: this item is included in nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:nev:wpaper:wp201705

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