Costs of Inefficient Regulation: Evidence from the Bakken
Gabriel Lade () and
No 24139, NBER Working Papers from National Bureau of Economic Research, Inc
Efficient pollution regulation equalizes marginal abatement costs across sources. Here we study a new flaring regulation in North Dakota's oil and gas industry and document its efficiency. Exploiting detailed well-level data, we find that the regulation reduced flaring 4 to 7 percentage points and accounts for up to half of the observed flaring reductions since 2015. We construct firm-level marginal flaring abatement cost curves and find that the observed flaring reductions could have been achieved at 20% lower cost by imposing a tax on flared gas equal to current public lands royalty rates instead of using firm-specific flaring requirements.
JEL-codes: L71 Q3 Q4 (search for similar items in EconPapers)
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Published as Gabriel E. Lade & Ivan Rudik, 2020. "Costs of inefficient regulation: Evidence from the bakken," Journal of Environmental Economics and Management, .
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Journal Article: Costs of inefficient regulation: Evidence from the Bakken (2020)
Working Paper: Costs of inefficient regulation: Evidence from the Bakken (2020)
Working Paper: Costs of Inefficient Regulation: Evidence from the Bakken (2018)
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