Regulatory Federalism and the Distribution of Air Pollutant Emissions

The spatial and temporal distributions of income and pollution have important implications in both a positive and normative sense. Recent empirical work suggests that (i) incomes have spatially converged through time, and (ii) income and pollution levels are linked. This paper weds these two literatures by examining the spatial and temporal distribution of pollution. After establishing that theoretical predictions about whether pollution converges or diverges are critically linked to certain structural parameters, we explore pollution convergence using state-level data on two important pollutants—nitrogen oxides and sulfur oxides—from 1929-1999. We find stronger evidence of convergence in emission rates during the federal pollution control years (1970-1999) than during the local control years (1929-1969). These results suggest that income convergence alone may not be sufficient to induce convergence of pollutant emissions.