Essays in environmental economics

This body of work contributes to the literature on two current topics in environmental economics: (1) the relationship between economic development and environmental degradation; and (2) the effectiveness of mandatory information disclosure as a regulatory instrument. For the first topic, we link theoretical and empirical Environmental Kuznets Curve research by using calibration and simulation to test a growth model with environmental quality as a normal good and emissions as a factor of production. We use U.S. macroeconomic, emissions and compliance data to calibrate parameters representing preferences for environmental quality and marginal abatement costs. We simulate the model starting from a less-developed initial condition and compare the predicted pollution-income relationship with that in the data. Our results are mixed. Some support exists for the theory that an inverted U-shape results from a corner solution in which less developed countries do not abate pollution. However, pollution peaks at a level of per capita income which is much lower than that observed in the U.S. data.For the second topic, we study the effectiveness of mandatory information disclosure as environmental regulation. Community-right-to-know programs such as the EPA\u27s Toxic Release Inventory (TRI) use mandatory information disclosure to shame dirty firms into reducing emissions. The idea is that the public---armed with previously unavailable emissions information---will pressure firms with higher-than-expected emissions to clean-up. We use the electricity industry to study the impact of price-and-entry deregulation on the effectiveness of the TRI. Using event studies, we find that, on average, utilities experience losses in firm value immediately following TRI announcements. Using panel regressions, we show that toxic emissions released in regulated states are associated with decreases in firm value while those released in deregulated states are associated with increases in firm value. We then estimate the impact of changes in firm value on subsequent emissions, finding that releases of most TRI pollutants are reduced in regulated states, but not in deregulated states