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Do Environmental Regulations Disproportionately Affect Small Businesses? Evidence from the Pollution Abatement Costs and Expenditures Survey

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Paper Number: 2012-06

Document Date: 08/21/2013

Authors: Randy A. Becker Ronald J. Shadbegian Carl Pasurka

Subject Areas: Costs of Pollution Control; Distributional Effects

Keywords: Environmental Regulation; costs; Business size; U. S.manufacturing

Abstract: This paper examines whether the impact of environmental regulations differs by the size of the business. We consider the net effect of statutory, enforcement, and compliance asymmetries by estimating the relationship between plant size and pollution abatement expenditures, using establishment-level data on U.S. manufacturers from the Census Bureau’s Pollution Abatement Costs and Expenditures (PACE) survey and from its Annual Survey of Manufactures and Census of Manufactures. We model establishments’ pollution abatement operating costs (PAOC) per unit of economic activity as a function of establishment size, industry, state, and year. Our results show that PAOC intensity increases with establishment and firm size. Updated Version posted 8-21-2013

Attachment: 2012-06_revised.pdf2012-06_revised.pdf (787K, About PDF)

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