The Benefits of Spatially Differentiated Regulation: The Response to Acid Rain by U.S. States Prior to the Acid Rain Program

16 Pages Posted: 15 Apr 2020

See all articles by Grischa Perino

Grischa Perino

University of Hamburg

Olena Talavera

affiliation not provided to SSRN

Date Written: January 2014

Abstract

Location is a crucial driver of both the marginal abatement and damage costs of sulfur dioxide emissions by U.S. coal‐fired power plants. Before the start of the Acid Rain Program in 1995, old boilers were subject to emission rate standards set by individual states. We investigate how individual states adjusted their sulfur regulation laws in response to acid rain, and whether they accounted for differences in marginal abatement costs, vulnerability to agricultural damages, special industry interests, or inter‐state externalities. The welfare gain compared to a uniform reduction in emission rate standards is estimated to be $21 million (in 1995 dollars) annually.

Keywords: acid rain, emission rate standards, inter-state externality, new environmental threat, spatially differentiated regulation

Suggested Citation

Perino, Grischa and Talavera, Olena, The Benefits of Spatially Differentiated Regulation: The Response to Acid Rain by U.S. States Prior to the Acid Rain Program (January 2014). American Journal of Agricultural Economics, Vol. 96, Issue 1, pp. 108-123, 2014, Available at SSRN: https://ssrn.com/abstract=3573703 or http://dx.doi.org/10.1093/ajae/aat084

Grischa Perino (Contact Author)

University of Hamburg ( email )

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Hamburg, 20354
Germany

HOME PAGE: http://sites.google.com/site/gperinosite/

Olena Talavera

affiliation not provided to SSRN

No Address Available

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