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Cowles Foundation Discussion Papers

2015

Market-based instruments

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Full-Text Articles in Economics

Why Is Pollution From U.S. Manufacturing Declining? The Roles Of Trade, Regulation, Productivity, And Preferences, Joseph S. Shapiro, Reed Walker Jan 2015

Why Is Pollution From U.S. Manufacturing Declining? The Roles Of Trade, Regulation, Productivity, And Preferences, Joseph S. Shapiro, Reed Walker

Cowles Foundation Discussion Papers

Between 1990 and 2008, air pollution emissions from U.S. manufacturing fell by 60 percent despite a substantial increase in manufacturing output. We show that these emissions reductions are primarily driven by within-product changes in emissions intensity rather than changes in output or in the composition of products produced. We then develop and estimate a quantitative model linking trade with the environment to better understand the economic forces driving these changes. Our estimates suggest that the implicit pollution tax that manufacturers face doubled between 1990 and 2008. These changes in environmental regulation, rather than changes in productivity and trade, account for …


Why Is Pollution From U.S. Manufacturing Declining? The Roles Of Trade, Regulation, Productivity, And Preferences, Joseph S. Shapiro, Reed Walker Jan 2015

Why Is Pollution From U.S. Manufacturing Declining? The Roles Of Trade, Regulation, Productivity, And Preferences, Joseph S. Shapiro, Reed Walker

Cowles Foundation Discussion Papers

Between 1990 and 2008, emissions of the most common air pollutants from U.S. manufacturing fell by 60 percent, even as real U.S. manufacturing output grew substantially. This paper develops a quantitative model to explain how changes in trade, environmental regulation, productivity, and consumer preferences have contributed to these reductions in pollution emissions. We estimate the model’s key parameters using administrative data on plant-level production and pollution decisions. We then combine these estimates with detailed historical data to provide a model-driven decomposition of the causes of the observed pollution changes. Finally, we compare the model-driven decomposition to a statistical decomposition. The …


Why Is Pollution From U.S. Manufacturing Declining? The Roles Of Environmental Regulation, Productivity, And Trade, Joseph S. Shapiro, Reed Walker Jan 2015

Why Is Pollution From U.S. Manufacturing Declining? The Roles Of Environmental Regulation, Productivity, And Trade, Joseph S. Shapiro, Reed Walker

Cowles Foundation Discussion Papers

Between 1990 and 2008, air pollution emissions from U.S. manufacturing fell by 60 percent despite a substantial increase in manufacturing output. We show that these emissions reductions are primarily driven by within-product changes in emissions intensity rather than changes in output or in the composition of products produced. We then develop and estimate a quantitative model linking trade with the environment to better understand the economic forces driving these changes. Our estimates suggest that the implicit pollution tax that manufacturers face doubled between 1990 and 2008. These changes in environmental regulation, rather than changes in productivity and trade, account for …


Why Is Pollution From U.S. Manufacturing Declining? The Roles Of Environmental Regulation, Productivity, And Trade, Joseph S. Shapiro, Reed Walker Jan 2015

Why Is Pollution From U.S. Manufacturing Declining? The Roles Of Environmental Regulation, Productivity, And Trade, Joseph S. Shapiro, Reed Walker

Cowles Foundation Discussion Papers

Between 1990 and 2008, air pollution emissions from U.S. manufacturing fell by 60 percent despite a substantial increase in manufacturing output. We show that these emissions reductions are primarily driven by within-product changes in emissions intensity rather than changes in output or in the composition of products produced. We then develop and estimate a quantitative model linking trade with the environment to better understand the economic forces driving these changes. Our estimates suggest that the implicit pollution tax that manufacturers face doubled between 1990 and 2008. These changes in environmental regulation, rather than changes in productivity and trade, account for …


Why Is Pollution From U.S. Manufacturing Declining? The Roles Of Environmental Regulation, Productivity, And Trade, Joseph S. Shapiro, Reed Walker Jan 2015

Why Is Pollution From U.S. Manufacturing Declining? The Roles Of Environmental Regulation, Productivity, And Trade, Joseph S. Shapiro, Reed Walker

Cowles Foundation Discussion Papers

Between 1990 and 2008, air pollution emissions from U.S. manufacturing fell by 60 percent despite a substantial increase in manufacturing output. We show that these emissions reductions are primarily driven by within-product changes in emissions intensity rather than changes in output or in the composition of products produced. We then develop and estimate a quantitative model linking trade with the environment to better understand the economic forces driving these changes. Our estimates suggest that the implicit pollution tax that manufacturers face doubled between 1990 and 2008. These changes in environmental regulation, rather than changes in productivity and trade, account for …