Economics at your fingertips  

Two birds, one stone? Local pollution regulation and greenhouse gas emissions

Claire Brunel () and Erik Paul Johnson

Energy Economics, 2019, vol. 78, issue C, 1-12

Abstract: In most countries, environmental regulation focuses on local pollution, which causes damages near the emission source, while regulation on global pollutants such as greenhouse gases (GHGs) has been slow. Theoretically, local and global pollutants can either be substitutes or complements in production. A firm's response to local pollution regulation can lead greenhouse gas emissions to decrease if the firm switches energy source from oil to natural gas, or to increase if it reduces the temperature of a natural gas-fired boiler, which causes NOx emissions to fall but CO2 emissions to rise. Consequently, local pollution regulation may either intensify or reduce global warming concerns. We exploit new data on US GHG emissions and variation in local pollution regulation across US counties to estimate this relationship. We find no evidence that more stringent local pollution regulation changes GHG emissions from the non-energy sectors. The lack of a statistically detectable effect cannot be explained by a decrease in production or by firms switching production to less regulated countries, and it is true on aggregate as well as for individual polluting industries, though in some instances the coefficients are not precisely estimated. Therefore, local pollution regulation is unlikely to suffice to address global warming.

Keywords: Climate change; Clean Air Act Amendments; Co-benefits; Local pollutants; Environmental regulation (search for similar items in EconPapers)
JEL-codes: Q52 Q53 Q54 Q58 H23 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this article

Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant

More articles in Energy Economics from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

Page updated 2019-11-12
Handle: RePEc:eee:eneeco:v:78:y:2019:i:c:p:1-12