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Working Paper: Environmental Justice: Do Poor and Minority Populations Face More Hazards?

Paper Number: 2010-10

Document Date: 09/2010

Author(s): Wayne B. Gray, Ronald J. Shadbegian, and Ann Wolverton

Subject Area(s): Air Pollution; Distributional Effects; Enforcement Issues

JEL Classification: Production and Organizations: Firm Behavior: Theory; Environmental Economics: Pollution Control Adoption and Costs; Distributional Effects; Employment Effects; Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

Keywords: environmental justice; regulatory activity; enforcement; political; poor; minority

Abstract: In this paper, we examine the large and expanding area of Environmental Justice (EJ). The research in this area has developed from examining relatively simple comparisons of current demographic characteristics near environmental nuisances to performing multiple regression analysis and considering demographics at the time of siting. One area that has received considerably less attention is the identification of potential mechanisms that could be driving observed EJ correlations. We extend the current literature by examining one possible mechanism: the intensity of regulatory enforcement activity. If regulators pay less attention to the environmental performance of plants located near poor and minority areas, those plants might feel less pressure to pursue pollution abatement projects, increasing environmental hazards in those areas. We perform our analysis on a sample of manufacturing plants located near four large U.S. cities: Los Angeles, Boston, Columbus, and Houston. Our analysis of regulatory activity found little evidence that demographic variables have a significant impact on the allocation of regulatory activity. In particular, regulatory activity does not seem to be less intense in plants located near particular demographic groups. It is true that plants located in minority neighborhoods are inspected less often and face fewer enforcement actions, but these effects are nearly always small and insignificant, and plants located in lower-income areas seem to face (surprisingly) more regulatory activity. In a separate analysis, we also find very little evidence that demographic variables significantly influence pollution emissions. . In summary, the results presented here do not show much evidence to support EJ concerns about either regulatory activity or pollution emissions, at least within the set of plants, pollutants, and time periods covered in our analysis.

Published: Wayne Gray, Ronald Shadbegian, and Ann Wolverton, "Environmental Justice: Do Poor and Minority Populations Face More Hazards?" in Oxford Handbook of the Economics of Poverty, Philip N. Jefferson, ed., Oxford University Press, 2012.

This paper is part of the Environmental Economics Working Paper Series.

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