Jobs and Environmental Regulation

53 Pages Posted: 23 Jul 2019

See all articles by Marc Hafstead

Marc Hafstead

Resources for the Future

Roberton C. Williams

University of Maryland - Department of Agricultural & Resource Economics; National Bureau of Economic Research (NBER); Resources for the Future

Date Written: July 2019

Abstract

Political debates around environmental regulation often center around the effect of policy on jobs. Opponents decry the “job-killing” EPA and proponents point to “green jobs” as a positive policy outcome. And beyond the political debates, Congress requires the EPA to evaluate “potential losses or shifts of employment” that regulations under the Clean Air Act may cause. Yet there is a sharp disconnect between the political importance of the jobs question and the limited research on job effects of policy and general skepticism in the academic literature about the importance of those job effects for the costs and benefits of environmental regulation. In this paper, we discuss how the existing research on jobs and environmental regulations often falls short in evaluating these questions and consider recent new work that has attempted to address these problems. We provide an intuitive discussion of key questions for how job effects should enter into economic analysis of regulations. And, using an economic model from Hafstead, Williams, and Chen (2018), we evaluate a range of environmental regulations in both the short and long-run to develop a set of key stylized facts related to jobs and environmental regulations and to identify the key questions that current models can’t yet answer well.

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Suggested Citation

Hafstead, Marc and Williams, Roberton C., Jobs and Environmental Regulation (July 2019). NBER Working Paper No. w26093, Available at SSRN: https://ssrn.com/abstract=3423806

Marc Hafstead (Contact Author)

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Roberton C. Williams

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