Abstract

http://ssrn.com/abstract=2103699
 
 

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Endogenous Decentralization in Federal Environmental Policies


Howard F. Chang


University of Pennsylvania Law School

Hilary Sigman


Rutgers University - Department of Economics; National Bureau of Economic Research (NBER)

Leah Goldman Traub


Lord Abbett; Rutgers, The State University of New Jersey

2012

U of Penn, Inst for Law & Econ Research Paper No. 12-25

Abstract:     
Under most federal environmental laws and some health and safety laws, states may apply for “primacy,” that is, authority to implement and enforce federal law, through a process known as “authorization.” Some observers fear that states use authorization to adopt more lax policies in a regulatory “race to the bottom.” This paper presents a simple model of the interaction between the federal and state governments in such a scheme of partial decentralization. Our model suggests that the authorization option may not only increase social welfare but also allow more stringent environmental regulations than would otherwise be feasible. Our model also suggests that the federal government may choose its policies so that states that desire more strict regulation authorize, while other states remain under the federal program. We then test this hypothesis using data on federal regulation of water pollution and of hazardous waste, which are two of the most important environmental programs to allow authorization. We find that states that prefer more environmental protection authorize more quickly under both policies. This evidence suggests that states seek authorization to adopt more strict policies instead of more lax policies compared to federal policies.

Number of Pages in PDF File: 37

Keywords: Cooperative federalism, political economy, environmental law and regulation, economics, intergovernmental relations, federalism, government policy, air pollution, hazardous waste, empirical research, administrative law, primacy, authorization, decentralization, pollution control

JEL Classification: H77, K32, Q53, Q58

working papers series


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Date posted: July 12, 2012  

Suggested Citation

Chang, Howard F. and Sigman, Hilary and Traub, Leah Goldman, Endogenous Decentralization in Federal Environmental Policies (2012). U of Penn, Inst for Law & Econ Research Paper No. 12-25. Available at SSRN: http://ssrn.com/abstract=2103699 or http://dx.doi.org/10.2139/ssrn.2103699

Contact Information

Howard F. Chang (Contact Author)
University of Pennsylvania Law School ( email )
3501 Sansom Street
Philadelphia, PA 19104
United States
215-573-8296 (Phone)
215-573-2025 (Fax)
Hilary A. Sigman
Rutgers University - Department of Economics ( email )
75 Hamilton Street
New Brunswick, NJ 08901
United States
HOME PAGE: http://econweb.rutgers.edu/sigman
National Bureau of Economic Research (NBER)
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Leah Goldman Traub
Lord Abbett ( email )
90 Hudson Street
Jersey City, NJ 07302
United States
Rutgers, The State University of New Jersey ( email )
Economics Department
75 Hamilton Street
New Brunswick, NJ 08901
United States
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