Should You Turn Yourself In? The Consequences of Environmental Self-Policing

Sarah Stafford ()
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Sarah Stafford: Department of Economics, College of William and Mary

No 27, Working Papers from Department of Economics, College of William and Mary

Abstract: Facilities that self-police under the Environmental Protection AgencyÕs Audit Policy are eligible for reduced penalties on disclosed violations. This paper investigates whether self- policing has additional consequences, in particular whether self-policing reduces future enforcement activity. Using data on U.S. hazardous waste enforcement and disclosures, I find that facilities that self-police are rewarded with a lower probability of inspection in the future, although facilities with good compliance records may receive a smaller benefit than facilities with poor records. Additionally, facilities that are inspected frequently are more likely to disclose than facilities that face a low probability of inspection. The results suggest that facilities may be able to strategically disclose in order to decrease future enforcement.

Keywords: Self-Policing; Enforcement; Targeting; Compliance; Hazardous Waste (search for similar items in EconPapers)
JEL-codes: K32 K42 Q52 Q58 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-acc, nep-law and nep-reg
Date: 2006-02-23
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