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Environmental Regulation and Labor Demand: What Does the Evidence Tell Us?

Author

Listed:
  • Wayne B. Gray

    (Department of Economics, Clark University, Worcester, Massachusetts, USA)

  • Ron Shadbegian

    (Department of Economics, San Diego State University, San Diego, California, USA)

  • Ann Wolverton

    (National Center for Environmental Economics, US Environmental Protection Agency, Washington, DC, USA)

Abstract

Understanding the potential effect of environmental regulation on employment is of broad interest to key stakeholders. Concerns encompass both short- and longer-term effects on workers within the regulated sector, affected communities that already suffer from a lack of employment opportunities, and net employment in the overall economy. We begin our review by presenting a neoclassical microeconomic framework demonstrating how environmental regulations might affect labor demand. We then summarize the main empirical findings from the literature, including sector-specific partial equilibrium estimates and general equilibrium approaches to identifying the employment impacts of regulations. We also briefly describe the literature on how environmental regulations affect labor supply. Finally, we discuss remaining research gaps.

Suggested Citation

  • Wayne B. Gray & Ron Shadbegian & Ann Wolverton, 2023. "Environmental Regulation and Labor Demand: What Does the Evidence Tell Us?," Annual Review of Resource Economics, Annual Reviews, vol. 15(1), pages 177-197, October.
    • Handle: RePEc:anr:reseco:v:15:y:2023:p:177-197
    DOI: 10.1146/annurev-resource-101422-115834
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    More about this item

    Keywords

    employment; environmental regulation; labor demand;
    All these keywords.

    JEL classification:

    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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