Pollution Abatement Expenditure by U.S. Manufacturing Plants: Do Community Characteristics Matter?

Economic Analysis & Policy, Vol. 3, No. 6, pp. 1-21, December 2004

THE ECONOMICS OF POLLUTION HAVENS, Don Fullerton, ed., Edward Elgar Publishing, 2006

25 Pages Posted: 18 Nov 2009

See all articles by Randy A. Becker

Randy A. Becker

U.S. Census Bureau - Center for Economic Studies

Date Written: November 1, 2003

Abstract

A number of previous studies have demonstrated the impact of community characteristics on environmental outcomes such as local pollution levels and the siting of noxious facilities. If certain groups are indeed exposed to higher levels of air pollution, it may be due to a greater concentration of air polluters in those communities and/or facilities in those areas investing less in air pollution abatement. This paper examines the latter, using establishment-level data on manufacturing plants from the U.S. Census Bureau?s Pollution Abatement Costs and Expenditures (PACE) survey. The empirical formulation herein allows plant-level air pollution abatement operating costs to depend on an array of community characteristics common to this literature. After controlling for establishment characteristics and federal, state, and local regulation, some of these local factors are found to have had an additional effect on air pollution abatement expenditures. In particular, populations with higher homeownership rates and higher per capita income enjoyed greater pollution abatement activity from their nearby plants. Meanwhile, establishments in communities where manufacturing accounted for a greater share of local employment had less pollution abatement spending, suggesting a local constituency that is more resistant to additional regulation. Political ideology is also found to play a role, with plants in areas with larger concentrations of Democrats having more expenditure on air pollution abatement, all else being equal. There is little evidence that race and ethnicity matter when it comes to the pollution abatement behavior of the most pollution-intensive facilities. The findings of this paper support those of a number of recent studies.

Keywords: air pollution abatement, community characteristics, manufacturing

JEL Classification: L6, Q21, Q25

Suggested Citation

Becker, Randy A., Pollution Abatement Expenditure by U.S. Manufacturing Plants: Do Community Characteristics Matter? (November 1, 2003). Economic Analysis & Policy, Vol. 3, No. 6, pp. 1-21, December 2004, THE ECONOMICS OF POLLUTION HAVENS, Don Fullerton, ed., Edward Elgar Publishing, 2006, Available at SSRN: https://ssrn.com/abstract=1507914

Randy A. Becker (Contact Author)

U.S. Census Bureau - Center for Economic Studies ( email )

4600 Silver Hill Road
Washington, DC 20233
United States

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