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Jobs and Environmental Regulation

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  • Marc A. C. Hafstead
  • Roberton C. Williams III

Abstract

Political debates about environmental regulation often center around the effect of policy on jobs. Opponents decry the “job-killing” Environmental Protection Agency (EPA) and proponents point to “green jobs” as a positive policy outcome. Beyond the political debates, Congress requires the EPA to evaluate “potential losses or shifts of employment” that regulations under the Clean Air Act may cause. Yet there is a sharp disconnect between the political importance of the jobs question and the limited research on the job effects of policy and general skepticism in the academic literature about the importance of those job effects for the costs and benefits of environmental regulation. In this paper, we discuss how the existing research on jobs and environmental regulations often falls short in evaluating these questions and consider recent new work that has attempted to address these problems. We provide an intuitive discussion of key questions for how job effects should enter into economic analysis of regulations. And, using an economic model that incorporates labor market frictions, we evaluate a range of environmental regulations in both the short and long run to develop a set of key stylized facts related to jobs and environmental regulations and to identify the key questions that current models cannot yet answer well.

Suggested Citation

  • Marc A. C. Hafstead & Roberton C. Williams III, 2020. "Jobs and Environmental Regulation," Environmental and Energy Policy and the Economy, University of Chicago Press, vol. 1(1), pages 192-240.
    • Handle: RePEc:ucp:epolec:doi:10.1086/706799
    DOI: 10.1086/706799
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    Cited by:

    1. Antoine Dechezleprêtre & Misato Sato, 2017. "The Impacts of Environmental Regulations on Competitiveness," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 11(2), pages 183-206.
    2. Łukasz Jarosław Kozar & Robert Matusiak & Marta Paduszyńska & Adam Sulich, 2022. "Green Jobs in the EU Renewable Energy Sector: Quantile Regression Approach," Energies, MDPI, vol. 15(18), pages 1-21, September.
    3. Alan Finkelstein Shapiro & Gilbert E. Metcalf, 2021. "The Macroeconomic Effects of a Carbon Tax to Meet the U.S. Paris Agreement Target: The Role of Firm Creation and Technology Adoption," NBER Working Papers 28795, National Bureau of Economic Research, Inc.
    4. Antosiewicz, Marek & Fuentes, J. Rodrigo & Lewandowski, Piotr & Witajewski-Baltvilks, Jan, 2022. "Distributional effects of emission pricing in a carbon-intensive economy: The case of Poland," Energy Policy, Elsevier, vol. 160(C).
    5. Maud Lanau & Luca Herbert & Gang Liu, 2021. "Extending urban stocks and flows analysis to urban greenhouse gas emission accounting: A case of Odense, Denmark," Journal of Industrial Ecology, Yale University, vol. 25(4), pages 961-978, August.
    6. Lynn Riggs & Livvy Mitchell, 2021. "Predicted Distributional Impacts of Climate Change Policy on Employment," Working Papers 21_07, Motu Economic and Public Policy Research.
    7. E. Mark Curtis & Ioana Marinescu, 2023. "Green Energy Jobs in the United States: What Are They, and Where Are They?," Environmental and Energy Policy and the Economy, University of Chicago Press, vol. 4(1), pages 202-237.
    8. Yang, Yuxiang & Goodarzi, Shadi & Bozorgi, Ali & Fahimnia, Behnam, 2021. "Carbon cap-and-trade schemes in closed-loop supply chains: Why firms do not comply?," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 156(C).
    9. Łukasz Jarosław Kozar & Adam Sulich, 2023. "Green Jobs in the Energy Sector," Energies, MDPI, vol. 16(7), pages 1-20, March.
    10. Susan Park, 2021. "Policy Norms, the Development Finance Regime Complex, and Holding the European Bank for Reconstruction and Development to Account," Global Policy, London School of Economics and Political Science, vol. 12(S4), pages 90-100, May.
    11. Shiyu Bo, 2021. "Environmental Regulations, Political Incentives and Local Economic Activities: Evidence from China," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 83(3), pages 812-835, June.
    12. Carr, Olivia G. & Jilani-Hyler, Nadia & Murray, Gregg R., 2022. "Identifying factors related to school closures due to COVID-19 in the Middle East and North Africa region," International Journal of Educational Development, Elsevier, vol. 90(C).
    13. Lynn Riggs & Livvy Mitchell, 2021. "Methodology for Modelling Distributional Impacts of Emissions Budgets on Employment in New Zealand," Working Papers 21_14, Motu Economic and Public Policy Research.

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    More about this item

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • 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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