Agency governance and enforcement: the influence of mission on environmental decisionmaking

Administrative agencies seeking to impose sanctions for regulatory violations can handle matters internally or through civil or criminal courts. Organizational culture, legal constraints, and political and private actors may influence governance and hence choice of enforcement venue. An enforcement behavior model is constructed and tested empirically using a 1990–1997 sample of Environmental Protection Agency (EPA) air, water, and hazardous waste penalty cases involving individuals. While EPA's enforcement arm embraces the mission of its regulatory arm—minimizing environmental harm—in part, it also has attributes of a police and prosecution force—specifically deterring (and maximizing social welfare) or incapacitating individual violators. Nevertheless, EPA may fail to minimize violations of and generally deter non‐culpable individuals who are affiliated with large firms. © 2002 by the Association for Public Policy Analysis and Management.     

Should you turn yourself in? The consequences of environmental self‐policing

Facilities that self‐police under the Environmental Protection Agency's Audit Policy are eligible for reduced penalties on disclosed violations. This paper investigates whether self‐policing has additional consequences; in particular, whether self‐policing reduces future enforcement activity. Using data on U.S. hazardous waste enforcement and disclosures, I find that facilities that self‐police are rewarded with a lower probability of inspection in the future, although facilities with good compliance records receive a smaller benefit than facilities with poor records. Additionally, facilities that are inspected frequently are more likely to disclose than facilities that face a low probability of inspection. The results suggest that facilities may be able to strategically disclose in order to decrease future enforcement. © 2007 by the Association for Public Policy Analysis and Management     

Taking enforcement on its own terms: EPA's heavy‐duty diesel engine litigation

The authors of Regulation by Litigation characterize the US Environmental Protection Agency (EPA)'s enforcement action against diesel engine manufacturers as an effort to achieve by litigation what the Agency was unable to achieve by regulation: immediate reductions in emissions of nitrogen oxides. By substituting litigation for rulemaking, the authors of the book argue, the Agency avoided political and judicial accountability and put itself on a suboptimal policy track. This comment argues that the diesel engine litigation may be better understood as what it purported to be, an enforcement action, not rulemaking in disguise. The authors' characterization of the litigation is questionable on at least two grounds. First, it fails to fully appreciate the distinct functions of enforcement and policymaking in a regulatory setting. The goal of enforcement is not primarily to make policy, but to enforce it – to punish violators, deter future violations, and mitigate harms caused by violations. That goal supplies the proper measure of the litigation's success. Second, in applying public choice analysis to create a story of agency circumvention of appropriate rulemaking procedures, the authors' account misses key features of how agency enforcement decisions are made – and were made in this litigation. This latter shortcoming raises broader questions about the difficulties of applying public choice analysis in complex institutional settings.     

Policy monitoring and policy analysis

In this article we introduce a policy analytic technique that we call “policy monitoring.” Using data from the Environmental Protection Agency's Hazardous Waste Division, we demonstrate how the technique can be employed in actual practice. The case study demonstrates that EPA enforcements were responsive to stimuli emanating from outside the agency. In particular, relevant congressional committees were able to influence and effect change in the EPA's policy. In addition to demonstrating how policy monitoring can be employed, we also discuss how it can be used in other policy analytic situations.     

Secondary learning and the unintended benefits of collaborative mechanisms: The Federal Aviation Administration's voluntary disclosure programs

Along with other types of process‐oriented regulation, voluntary disclosure programs are increasingly used by regulatory agencies to supplement traditional inspection activities. Voluntary disclosure programs provide incentives, such as immunity or reduced regulatory enforcement to those submitting reports, while providing regulatory agencies with valuable information on existing risks and areas of non‐compliance. This article contributes to the discussion of voluntary disclosure programs by highlighting an important unconsidered benefit of such programs: the secondary learning they generate, above and beyond information about violations. Beyond the information submitted by firms contained in the self‐disclosures, the programs generate information and insights about the usual practices of the industry, the division of labor, typical problems, and ways to handle them – those details often invisible to those outside an organization or inside the organization but not “on the ground.” This additional information provides important benefits to both industry management and agency officials. We demonstrate the existence of secondary learning and describe the effect of the structure of voluntary programs on secondary learning with evidence from two case studies of the Federal Aviation Administration's voluntary disclosure programs: the Aviation Safety Action Program and the Voluntary Disclosure Reporting Program.     

How costly is “clean”? An analysis of the benefits and costs of Superfund site remediations

The cleanup of hazardous waste sites under the U.S. Environmental Protection Agency's Superfund program is governed by a number of legislative and regulatory constraints. Congress passed legislation in 1986 directing the Environmental Protection Agency (EPA) to pursue permanent remedies that embodied stringent cleanup standards. The agency has chosen to use conservative assumptions in risk assessments at hazardous waste sites, including a presumption that on‐site risks for hypothetical future residents should be calculated in the site remediation process. This article offers the first comprehensive assessment of the cost‐effectiveness of these Superfund cleanups. Our results reveal that many EPA Superfund remediations fail a partial benefit‐cost test. For a sample of the 150 Superfund sites, we find that at the majority of sites the expected number of cancers averted by remediation is less than 0.1 cases per site and that the cost per cancer case averted is over $100 million. The analysis demonstrates the importance of explicitly calculating the trade‐offs embodied in environmental cleanup decisions. © 1998 by the Association for Public Policy Analysis and Management     

The impact of child support enforcement policy on nonmarital childbearing

The interaction of welfare and child support regulations has created a situation in which child support policy's incentives that discourage unwed fatherhood tend to be stronger than its incentives that encourage unwed motherhood. This suggests that more stringent child support enforcement creates incentives that reduce the likelihood of nonmarital childbearing, particularly among women with a significant chance of needing public assistance in the event of a nonmarital birth and their male partners. We investigate this hypothesis with a sample of women from the Panel Study of Income Dynamics, to which we add information on state child support enforcement. We examine childbearing behavior between the ages of 15 and 44 before marriage and during periods of non‐marriage following divorce or widowhood. The estimates indicate that women living in states with more effective child support enforcement are less likely to bear children when unmarried, especially if they are young, never‐married, or black. The findings suggest that improved child support enforcement may be a potent intervention for reducing nonmarital childbearing. © 2006 by the Association for Public Policy Analysis and Management.     

Public choice and the EPA: Empirical evidence on carbon emissions violations

This study provides evidence of public choice determinants of the penalties assessed by the Environmental Protection Agency for carbon emissions violations. Following the work of Stigler (1971), Peltzman (1976), Tollison (1982), and Tullock (1989), this study points out that powerful business interest groups are able to use their political influence to shape EPA environmental policy for urban areas. The statistical estimates presented here suggest that business groups have limited power (through lobbying activity) in affecting the probability of the occurrence of an EPA citation for carbon emissions violations, while they may have considerable power in influencing thedegree of an EPA citation for carbon emissions standards, once a citation occurs.     

When Governments Regulate Governments

This article advances a political theory of regulation that accounts for the choices of regulators and regulated entities when both are governments. Leading theories of regulation assume that governments regulate profit‐maximizing firms: Governments set rules, to which firms respond rationally in ways that constrain their behavior. But often the entities that governments regulate are other governments. We argue that government agencies and private firms often face different compliance costs, and that agencies have greater incentives than firms to appeal regulations through political channels. Simultaneously, the typical enforcement instruments that regulators use to influence firm behavior may be less effective against governments. Our empirical subjects are public and private entities’ compliance with the U.S. Clean Air Act and Safe Drinking Water Act. We find that, compared with private firms, governments violate these laws significantly more frequently and are less likely to be penalized for violations.     

Money Talks: The Environmental Impact of China's Green Credit Policy

This study examines the impact of China's green credit policy on the environment. In particular, we consider an initiative that requires all banks to base their loan decisions on corporate environmental performance. This is an important issue since it is globally gaining popularity to leverage bank loans as an avenue to enforce corporate environmental responsibility. Moreover, there are only a handful of empirical investigations in relation to the impacts of credit constraint on corporate environmental behaviors and strategies. This research also provides useful insights on how to enhance environmental regulation enforcement, using the Environmental Protection Bureau in partnership with local banks to exert a creditable threat of financial constraint on unfavorable environmental outcomes. Using the synthetic control method and difference‐in‐differences analysis, we find that this policy has significantly motivated firms, particularly those firms with a higher dependence on external financing, to reduce water pollution. We further discover that the policy compels firms to favor pollution prevention at the source instead of end‐of‐pipe treatments, since the policy imposes a long‐term credit constraint on pollution.     

Defining Environmental Justice Communities for Regulatory Enforcement: Implications from a Block‐Group‐Level Analysis of New York State

The absence of a clear definition of environmental justice areas has been cited as one of the U.S. Environmental Protection Agency's major deficiencies in managing federal environmental justice programs. Several states have explicitly defined potential environmental justice areas and integrated targeted efforts into the policy‐making process. At the block‐group level, this study evaluates the effects of New York State's environmental justice policy, which defines communities of concern in terms of demographic and socioeconomic characteristics as well as mandates supplemental regulatory enforcement activities for these neighborhoods, on the agency's policy implementation practices under the Clean Air Act and Clean Water Act. The empirical findings suggest that there is inconclusive evidence regarding race/ethnicity‐ and class‐based environmental inequity. Also, the state's policy intervention is not universally effective. Moreover, task environments of a given community are a consistent determinant of the agency's regulatory compliance monitoring and assurance activities. This study then derives broader implications regarding the adoption of a policy instrument that defines and screens potential environmental justice communities.     

Uniformity as response to soft law: Evidence from compliance and non‐compliance with the Dutch corporate governance code

The objective of the paper is to examine how firms have dealt with the trade‐off between flexibility and uncertainty that is characteristic for the decision‐making of firms in coping with self‐regulatory initiatives in general and the comply‐or‐explain principle in corporate governance in particular. Using unique data for 126 listed Dutch firms, we find that firms respond to this self‐regulatory initiative by largely complying with the code recommendation, possibly out of fear that the firm's reputation may be damaged. Furthermore, we find evidence suggesting that firms confine themselves to adopting a specific set of code recommendations and use similar arguments to explain non‐compliance. Our findings indicate uniformity in adopting the standard of good governance which is not in line with the logic of corporate governance codes and casts doubt on the effectiveness of this form of soft law. Overall, the paper's findings indicate that more restrictive (regulatory) instruments may be necessary to make firms conform to the spirit of codes.     

Women's Participation in Rural China's Self‐Governance: Institutional,Socioeconomic, and Cultural Factors in a Jiangsu County

We examined women's participation in village self‐governance in an Eastern Chinese county. While they have more or less been universally participating in voting in village elections, their representation in the village self‐governance bodies remains low, and their political aspiration and sense of empowerment remain limited. A wide range of factors contribute to this situation. In general, women enjoy a much lower level of education and are economically dependent upon male members of their families. Social gender, or the stereotypes of women as less competent and are expected to stay away from public affairs, plays a very significant role too. Institutional problems, such as frauds and irregularities in election, lack of government's attention in promoting women's political roles, and the inability of state‐sponsored women organizations to influence local governance, all contribute to underrepresentation and inadequate participation of women. Policy responses must look beyond women's electoral participation and address these many deep‐rooted issues.     

Tightened Immigration Policies and the Self‐Employment Dynamics of Mexican Immigrants

As the U.S. government has intensified its crackdown on illegal immigration in recent years, an important question to ask is how undocumented immigrants react to the stricter enforcement of immigration laws. This paper seeks to answer whether they increasingly choose self‐employment in an effort to avoid apprehension and subsequent deportation. To guard against endogeneity bias that might stem from increased enforcement in reaction to illegal immigration, the empirical analysis makes use of the September 11 terror attacks (9/11), which inadvertently triggered stricter immigration enforcement nationwide, as a natural experiment. Using a difference‐in‐differences approach and data from the Current Population Survey between 1996 and 2006, this paper examines the changes in the self‐employment choices of male and non‐citizen Mexican immigrants (a proxy for undocumented immigrants) compared to less‐educated Whites (the control group). The findings indicate that male and non‐citizen Mexican immigrants are substantially more likely (40 percent) to enter into self‐employment than less‐educated Whites after 9/11. The analysis further suggests that this finding is not driven by the 2001 recession that coincided with the terror attacks. The increased entries are mainly observed in the group that is most likely to be in the United States illegally and in those who face strong economic incentives. In addition, increased entries are not driven by increased unemployment among Mexican immigrants after the 9/11 event, but, rather, they reflect a change in the behavior of the unemployed Mexican immigrants, perhaps due to changes in perceived risks of detection and deportation.     

Collaborative environmental institutions: All talk and no action?

Many analysts view collaborative institutions that attempt to forge consensus and build cooperation among conflicting stakeholders as a potential remedy to the pathologies of conventional environmental policy. However, few analyses have demonstrated that collaborative institutions actually increase levels of cooperation, and critics accuse collaborative institutions of all talk and no action. This paper reports the use a quasi‐experimental design to compare the levels of consensus and cooperation in coastal watersheds with and without U.S. EPA's National Estuary Programs, one of the most prominent national examples of collaborative institutions in the environmental policy domain. Panel survey data from more than 800 respondents shows that while the level of consensus is higher in NEP estuaries, there is no difference between NEP and non‐NEP estuaries in the level of cooperation. © 2004 by the Association for Public Policy Analysis and Management.     

The impact of a gasoline tax on auto exhaust emissions

The EPA implements its policy of exhaust emission control by setting standards specified in terms of grams of pollutants per mile traveled. As a result, the tax must first restrain the vehicle miles traveled (VMT) if it is to have an impact on emission at all. EPA's choice of miles traveled as the medium through which its policy of pollution control must run is unfortunate, because travel is an activity that people resist giving up. This is reflected in a low long-run price elasticity of travel demand. Consequently, it takes substantial increases in the gasoline tax to make an impact on long-run travel demand. Simulation results show that under an alternative policy option, where EPA's standards are specified in terms of grams of pollutant per gallon of fuel burned, the same long-run reduction in exhaust emissions achievable today can be achieved (at an even higher level of confidence) with less than one-tenth of the increase in gasoline price required under the existing policy regime.     

Responsive bureaus,equity, and regulatory negotiation: an empirical view

Rulemaking agencies commonly delegate the implementation and enforcement of rules to affected parties, but they rarely delegate rulemaking authority. Regulatory negotiation is an example of this uncommon behavior. Compared to conventional rulemaking, regulatory negotiation is thought to be an attempt to make bureaucracy more responsive to affected stakeholders, especially when the rulemaking concerns politically complicated and technical issues. However, negotiation, while it may make bureaucrats more responsive, may also be less fair in that it is likely to result in relatively more responsiveness to interests supported by those with greater resources. This study presents empirical evidence that compares negotiated to conventional rulemaking processes at the Environmental Protection Agency in respect to both responsiveness and equality. The results uphold the expectation that negotiating rules appears more responsive than the conventional rule‐writing process. Furthermore, the results show inequality in both processes; outcomes of negotiated rules may be more unequal than outcomes of conventionally written rules. © 2002 by the Association for Public Policy Analysis and Management.     

Equal Employment Policy in France: Symbolic Support and a Mixed Record

This article analyzes the policy framework for and the implementation of equal employment policy in France. After presenting the equal employment policy framework and the role of state feminist women's policy offices in its development, the author discusses the limited support for positive action strategies among French firms and unions. The implementation of equal employment policy has had a mixed record, often limited to symbolic gestures rather than concrete change. Contributing to this symbolic dynamic are the effects of reconciliation policy and the impact of the development of part‐time work on women employment. The analysis argues that reconciliation policy has not for its part always privileged an egalitarian set of measures that facilitates the sharing of family and domestic work between men and women. The article asserts that the development of part‐time work has contradicted equal employment policy efforts and has effectively contributed to maintaining women's positions in low‐paying and marginal jobs. The article concludes that despite an apparently comprehensive policy framework for equal employment policy in France, the situation of women workers appears to be followin two tracks: a top‐tier track of qualified, relatively well‐paid women who are able to have a career and to reconcile family and work, and a lower‐tier track of less‐skilled, lower‐paid women workers who continue to be marginalized on the labor market.     

What can Post‐Democracy tell us about TNCs and Extraterritorial Violations of Human Rights?

This article considers the problem of extraterritorial human rights violations committed by transnational corporations (TNCs), and draws on Crouch's framework in Post‐democracy to illustrate why the issue has proved so difficult for states to regulate. I begin by examining the problem of corporate regulation more generally, and set out Crouch's analysis to show why and how corporations have become so influential. The second section considers the area of business and human rights, and explains why there is ‘a governance gap’ in relation to extraterritorial human rights violations committed by corporations. The third section describes efforts at the international and domestic levels to regulate corporations in relation to this issue. It concludes that while new international principles and innovative hybrid schemes are playing a valuable role in norm creation and standard‐setting, the enforcement of these principles remains limited. Corporations have largely succeeded to date in their lobbying efforts to remain free of any direct obligations under international law.     

Employers,the state and the politics of institutional change: Vocational education and training in Austria,Germany and Switzerland

An in‐depth comparison of Austria, Germany and Switzerland shows that the employers' constellation and the elites of the public education administration affect patterns of institutional change. If large firms are the dominant actors and collaborate with elites in the public education administration, institutional change follows a transformative pattern. If small and medium‐sized firms are in a strong position and have the power to influence public elites according to their interests, self‐preserving institutional change results. The article also shows that it is not so much trade unions as small and medium‐sized firms that act as a brake on transformative change. The article adds to the literature of institutional change by arguing that specifying and explaining patterns of institutional change requires that sufficient scope be allowed for actors' creative handling of institutions. It also suggests that in order to differentiate between self‐preserving and transformative change, one has to specify the important institutional dimensions that sustain an institution. The article combines Mill's method of agreement and difference.