Energize Weekly, August 22, 2018
Air pollution from U.S. manufacturing fell by 60 percent between 1990 and 2008 even as industrial output increased by 30 percent as a result of environmental laws and regulations, according to a study by University of California-Berkeley economists.
The researchers analyzed newly available data on 1,400 products produced by U.S. factories between 1990 and 2008. They combined that output data with plant level pollution emissions data.
The reasons for observed emission reductions were then categorized by changes in manufacturing, changes in the types of goods and products produced or changes in technology.
The researchers also quantified the importance of reductions in tariffs and other trade costs, as well as improved productivity.
Most of the reduction—in pollutants such as nitrogen oxide, sulfur dioxide and carbon monoxide—came from changes in technology and those in turn were driven by a tightening of environmental standards and costs.
“Our estimates suggest that the implicit pollution tax that manufacturers face doubled between 1990 and 2008,” the analysis said. “These changes in environmental regulation, rather than changes in productivity and trade, account for most of the emissions reductions.”
“People often assume that manufacturing production pollutes less today because manufacturing output has declined, when in fact output was 30 percent greater in 2008 than in 1990,” Reed Walker, an associate professor in the Haas School of Business and Department of Economics and a study co-author, said. “Others argue that manufacturing has shifted towards cleaner, high-tech products or that the manufacturing of ‘dirty’ products like steel has moved to China, Mexico or other foreign countries.”
“Our analysis showed that changes in the product-mix of U.S. manufacturing do not explain much of the reduction in emissions. Instead, manufacturers are producing the same types of goods, but they’ve taken significant steps to clean up their production processes,” Walker said.
This trend has played a key role in managing the nation’s air pollution. “In the 1960s and 1970s, people worried that Los Angeles, New York and other U.S. cities would have unbearable air pollution levels by the end of the 20th century,” Joseph Shapiro, an associate professor of agricultural and resource economics and a co-author of the study, said. “Instead, air pollution levels have plummeted, and the evidence shows that environmental regulation and the associated cleanup of production processes have played important roles in those steep declines.”
The study was funded in part by grants from the National Science Foundation and the U.S. Department of Energy.
