The Impacts of the 'Right to Know': Information Disclosure and the Violation of Drinking Water Standards
41 Pages Posted: 25 Oct 2006 Last revised: 16 Mar 2008
Date Written: March 13, 2008
Information disclosure regulations are increasingly common, but their effects on the behavior of regulated firms are unclear. The 1996 Amendments to the Safe Drinking Water Act mandated that community drinking water suppliers issue to customers annual consumer confidence reports (CCRs), containing information on violations of drinking water regulations and on observed contaminant levels. We examine the impact of mandatory information provision on drinking water violations by 517 community water systems in the Commonwealth of Massachusetts from 1990-2003. Results suggest that larger utilities required to mail CCRs directly to customers reduced total violations by between 30 and 44% as a result of this policy, and reduced the more severe health violations by 40 to 57%.
Keywords: regulation, information disclosure, water quality, right-to-know, program evaluation
JEL Classification: L51, Q53, Q58, D80
Suggested Citation: Suggested Citation