Regional and Aggregate Economic Consequences of Environmental Policy

Tom Schmitz, Italo Colantone and Gianmarco Ottaviano
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Italo Colantone: Bocconi University, Baffi-Carefin Research Centre, CESifo and FEEM

No 980, Working Papers from Queen Mary University of London, School of Economics and Finance

Abstract: This paper evaluates the aggregate impact of air pollution regulations introduced by the US Environmental Protection Agency in the early 2000s. We first provide regression evidence on the regulations’ effects across industries and local labor markets. We then use these results to calibrate a quantitative model allowing for general equilibrium spillovers through trade, migration, industry switching, input-output linkages and emission externalities. Our model implies that regulations lowered emissions by 11.1%, but also destroyed between 228’000 and 267’000 jobs. Ignoring general equilibrium spillovers and naively extrapolating from our regressions overestimates job losses in polluting industries, but underestimates job losses in clean industries.

Keywords: Environmental Policy; Fine Particles; Clean Air Act; Employment; Trade (search for similar items in EconPapers)
JEL-codes: E24 Q50 Q53 (search for similar items in EconPapers)
Date: 2024-06-12
New Economics Papers: this item is included in nep-ene, nep-env, nep-int, nep-res and nep-ure
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https://www.qmul.ac.uk/sef/media/econ/research/workingpapers/2024/wp980.pdf (application/pdf)

Related works:
Working Paper: Regional and Aggregate Economic Consequences of Environmental Policy (2024)
Working Paper: Regional and aggregate economic consequences of environmental policy (2024)
Working Paper: Regional and Aggregate Economic Consequences of Environmental Policy (2024)
Working Paper: Regional and aggregate economic consequences of environmental policy (2024)
Working Paper: Regional and Aggregate Economic Consequences of Environmental Policy (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:qmw:qmwecw:980

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