ENVIRONMENTAL POLITICS IN THE US: A STUDY OF STATE SULFUR DIOXIDE STANDARDS

What determines the environmental regulatory regime of a country or region? This paper addresses the question in detail, using the US and its widely varying environmental policies as the case study. What factors lead some US states to pass strict environmental regulations, while others are content with the baseline standards required at the national level? This work outlines the state environmental choice as a trade-off between the desires of consumers (who want better environmental quality) and of producers (who want less restrictive environmental standards). A rational state legislator maximises her chances of being re-elected by balancing these two competing forces when setting environmental policy.I test this model by directly analysing the state decision to adopt more restrictive sulfur dioxide regulations than those required by the federal government under the Environmental Protection Agency's "National Ambient Air Quality Standards" program. The statistical results suggest that legislators weigh the relative influence of consumer and producer groups when setting sulfur dioxide standards, in addition to accounting for meteorological influences that affect the cost of compliance with stricter environmental regulations. Limited evidence is also provided to support an inverted-U shaped relationship between income levels and environmental regulations.