Environmental Economics

The Effectiveness of EPA's Regulatory Enforcement: The Case of Industrial Effluent Standards

This study evaluates the effect of EPA water pollution standard enforcement on pollution in the pulp and paper industry. In particular, it analyzes the effect of plant inspections, and their associated enforement actions, on three responses by pulp and paper companies:

    Reductions in their levels of biological oxygen demand discharges
    Increases in the rates of compliance with the limitations in the permits
    Decreases in the rates of non-reporting of discharge levels int eh Discharge Monitoring Reports.
The original data set used consisted of a longitudinal data base of 77 pollution sources tracked on a quarterly basis from the first quarter of 1982 through the first quarter of 1985. EPA inspections have a statistically significant effect in the expected direction on pollution discharge levels, the probability of non-compliance, and the regularity of filing discharge monitoring reports. Although these effects are consistent with EPA's legislative mandate, they probably pass a benefit-cost test only for firms that make no capital expenditures and only modest operating expenditures following an inspection.
A later version dated December, 1989, is also available in hard copy form only; a copy can be obtained from the NCEE Librarian.
  • Keywords

    2. Cost-Benefit and Cost Effectiveness Analysis
    2. Cost-Benefit and Cost Effectiveness Analysis - Specific Sectors and Pollutants
    2. Cost-Benefit and Cost Effectiveness Analysis - Enforcement and Monitoring
    Environmental Media:
    b. Water
    b. Water - Surface
    Magat, Wesley A.
    Viscusi, W. Kip
    EPA Project Officer/ Manager:
    Carlin, Alan
    Geographic Area:
    United States
    Study Purpose:
    Empirical Application, Policy Evaluation
    Report Series:
    Economic Efficiency of Enforcement
    Inventory Record #: EE-0292
    List of all reports in the Series:
  • Participating Organizations

    Research Organization:

    Duke University, Fuqua School of BusinessAddress:
    City: State: ZIP:
    Phone: Fax:
    Funding Organization:
    Environmental Protection Agency, Office of Policy, Planning and EvaluationAddress:
    City: Washington State: DC ZIP: 20460
    Phone: Fax:
  • Report Details
    Number of Pages:
    Comment: Research also done by Northwestern University
    Grant/Contract #:
    CR811902-01 with Duke University;
    CR813602-01 with Northwestern University
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    Date Linked: 05/28/2009