Federalism and Regulation: Extrapolating from the Analysis of Environmental Regulation in the United States

Abstract:     
This article extends the author's prior work concerning how responsibility over environmental regulation in the United States should be allocated between the federal government and the states. It shows why the structure of the environmental regulation in the European Union is poorly suited for the control of interstate externalities, and exposes the weaknesses of arguments for the European Union's harmonization of process standards. It then explains that in the international community the arguments differ in large part because of the weak capacity for centralized environmental standard-setting. Trade measures can therefore be a desirable way of combatting overly lax process standards in exporting countries that lead to interjurisdictional spillovers. But such trade measures should not be permitted merely because the exporting country has less stringent environmental standards than the importing country. The article ends with an analysis of how race-to-the-bottom arguments in different regulatory contexts deal with analytically distinct phenomena.

Accepted Paper Series