IDEAS home Printed from https://ideas.repec.org/p/wrk/warwec/1440.html
   My bibliography  Save this paper

Man vs. Machine : Technological Promise and Political Limits of Automated Regulation Enforcement

Author

Listed:
  • Browne, Oliver R.

    (The Brattle Group)

  • Gazze, Ludovica

    (University of Warwick)

  • Greenstone, Michael

    (University of Chicago Harris School of Public Policy)

  • Olga Rostapshova

    (The University of Chicago)

Abstract

New technologies allow perfect detection of environmental violations at near-zero marginal cost, but take-up is low. We conducted a field experiment to evaluate enforcement of water conservation rules with smart meters in Fresno, CA. Households were randomly assigned combinations of enforcement method (automated or in-person inspections) and fines. Automated enforcement increased households’ punishment rates from 0.1 to 14%, decreased water use by 3%, and reduced violations by 17%, while higher fine levels had little effect. However, automated enforcement also increased customer complaints by 1,102%, ultimately causing its cancellation and highlighting that political considerations limit technological solutions to enforcement challenges.

Suggested Citation

  • Browne, Oliver R. & Gazze, Ludovica & Greenstone, Michael & Olga Rostapshova, 2022. "Man vs. Machine : Technological Promise and Political Limits of Automated Regulation Enforcement," The Warwick Economics Research Paper Series (TWERPS) 1440, University of Warwick, Department of Economics.
    • Handle: RePEc:wrk:warwec:1440
    as

    Download full text from publisher

    File URL: https://warwick.ac.uk/fac/soc/economics/research/workingpapers/2022/twerp_1440_-_gazze.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Abhijit Banerjee & Esther Duflo, 2006. "Addressing Absence," Journal of Economic Perspectives, American Economic Association, vol. 20(1), pages 117-132, Winter.
    2. Francisco Costa & François Gerard, 2021. "Hysteresis and the Welfare Effect of Corrective Policies: Theory and Evidence from an Energy-Saving Program," Journal of Political Economy, University of Chicago Press, vol. 129(6), pages 1705-1743.
    3. Mathias Reynaert & James M. Sallee, 2021. "Who Benefits When Firms Game Corrective Policies?," American Economic Journal: Economic Policy, American Economic Association, vol. 13(1), pages 372-412, February.
    4. Esther Duflo & Michael Greenstone & Nicholas Ryan, 2013. "Truth-telling by Third-party Auditors and the Response of Polluting Firms: Experimental Evidence from India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 128(4), pages 1499-1545.
    5. Francesco Drago & Roberto Galbiati & Pietro Vertova, 2009. "The Deterrent Effects of Prison: Evidence from a Natural Experiment," Journal of Political Economy, University of Chicago Press, vol. 117(2), pages 257-280, April.
    6. Wichman, Casey J. & Taylor, Laura O. & von Haefen, Roger H., 2016. "Conservation policies: Who responds to price and who responds to prescription?," Journal of Environmental Economics and Management, Elsevier, vol. 79(C), pages 114-134.
    7. Vollaard, Ben, 2017. "Temporal displacement of environmental crime: Evidence from marine oil pollution," Journal of Environmental Economics and Management, Elsevier, vol. 82(C), pages 168-180.
    8. Jeremy West & Robert W. Fairlie & Bryan Pratt & Liam Rose, 2021. "Automated Enforcement of Irrigation Regulations and Social Pressure for Water Conservation," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 8(6), pages 1179-1207.
    9. Ilyana Kuziemko, 2013. "How should inmates be released from prison? An assessment of parole versus fixed-sentence regimes," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 128(1), pages 371-424.
    10. Maurin, Eric & Ouss, Aurelie, 2009. "Sentence Reductions and Recidivism: Lessons from the Bastille Day Quasi Experiment," IZA Discussion Papers 3990, Institute of Labor Economics (IZA).
    11. Dhaliwal, Iqbal & Hanna, Rema, 2017. "The devil is in the details: The successes and limitations of bureaucratic reform in India," Journal of Development Economics, Elsevier, vol. 124(C), pages 1-21.
    12. Lorenzo Casaburi & Ugo Troiano, 2016. "Ghost-House Busters: The Electoral Response to a Large Anti–Tax Evasion Program," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 131(1), pages 273-314.
    13. Federico A. Bugni & Ivan A. Canay & Azeem M. Shaikh, 2019. "Inference under covariate‐adaptive randomization with multiple treatments," Quantitative Economics, Econometric Society, vol. 10(4), pages 1747-1785, November.
    14. Oliver R. Browne & Ludovica Gazze & Michael Greenstone, 2021. "Do Conservation Policies Work? Evidence from Residential Water Use," Environmental and Energy Policy and the Economy, University of Chicago Press, vol. 2(1), pages 190-225.
    15. Alm, James & Shimshack, Jay, 2014. "Environmental Enforcement and Compliance: Lessons from Pollution, Safety, and Tax Settings," Foundations and Trends(R) in Microeconomics, now publishers, vol. 10(4), pages 209-274, December.
    16. Damon Jones & David Molitor & Julian Reif, 2019. "What do Workplace Wellness Programs do? Evidence from the Illinois Workplace Wellness Study," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 134(4), pages 1747-1791.
    17. Jessoe, Katrina & Lade, Gabriel E. & Loge, Frank & Spang, Edward, 2021. "Residential water conservation during drought: Experimental evidence from three behavioral interventions," Journal of Environmental Economics and Management, Elsevier, vol. 110(C).
    18. Libor Dušek & Christian Traxler, 2022. "Learning from Law Enforcement," Journal of the European Economic Association, European Economic Association, vol. 20(2), pages 739-777.
    19. Greg Halich & Kurt Stephenson, 2009. "Effectiveness of Residential Water-Use Restrictions under Varying Levels of Municipal Effort," Land Economics, University of Wisconsin Press, vol. 85(4), pages 614-626.
    20. Michael Greenstone & Guojun He & Ruixue Jia & Tong Liu, 2020. "Can Technology Solve the Principal-Agent Problem? Evidence from China’s War on Air Pollution," Working Papers 2020-87, Becker Friedman Institute for Research In Economics.
    21. Henrik Jacobsen Kleven & Martin B. Knudsen & Claus Thustrup Kreiner & Søren Pedersen & Emmanuel Saez, 2011. "Unwilling or Unable to Cheat? Evidence From a Tax Audit Experiment in Denmark," Econometrica, Econometric Society, vol. 79(3), pages 651-692, May.
    22. Thomas Bossuroy & Clara Delavallade & Vincent Pons, 2019. "Biometric Tracking, Healthcare Provision, and Data Quality: Experimental Evidence from Tuberculosis Control," NBER Working Papers 26388, National Bureau of Economic Research, Inc.
    23. Brent, Daniel A. & Ward, Michael B., 2019. "Price perceptions in water demand," Journal of Environmental Economics and Management, Elsevier, vol. 98(C).
    24. Eric Yongchen Zou, 2021. "Unwatched Pollution: The Effect of Intermittent Monitoring on Air Quality," American Economic Review, American Economic Association, vol. 111(7), pages 2101-2126, July.
    25. Bar-Ilan, Avner & Sacerdote, Bruce, 2004. "The Response of Criminals and Noncriminals to Fines," Journal of Law and Economics, University of Chicago Press, vol. 47(1), pages 1-17, April.
    26. Daniel A. Brent & Joseph H. Cook & Skylar Olsen, 2015. "Social Comparisons, Household Water Use, and Participation in Utility Conservation Programs: Evidence from Three Randomized Trials," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 2(4), pages 597-627.
    27. Renwick, Mary E. & Green, Richard D., 2000. "Do Residential Water Demand Side Management Policies Measure Up? An Analysis of Eight California Water Agencies," Journal of Environmental Economics and Management, Elsevier, vol. 40(1), pages 37-55, July.
    28. Hunt Allcott & Todd Rogers, 2014. "The Short-Run and Long-Run Effects of Behavioral Interventions: Experimental Evidence from Energy Conservation," American Economic Review, American Economic Association, vol. 104(10), pages 3003-3037, October.
    29. Koichiro Ito & Takanori Ida & Makoto Tanaka, 2018. "Moral Suasion and Economic Incentives: Field Experimental Evidence from Energy Demand," American Economic Journal: Economic Policy, American Economic Association, vol. 10(1), pages 240-267, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. João Pedro Vieira & Ricardo Dahis & Juliano Assunção, 2023. "The Role of Sanctions and Spillovers in Forest Conservation," Monash Economics Working Papers 2023-16, Monash University, Department of Economics.
    2. Vieira, João Pedro & Dahis, Ricardo & Assunção, Juliano, 2023. "From Deforestation to Reforestation: The Role of General Deterrence in Changing Farmers' Behavior," SocArXiv vqpkm, Center for Open Science.
    3. Vollaard, Ben & van Soest, Daan, 2024. "Punishment to promote prosocial behavior: a field experiment," Journal of Environmental Economics and Management, Elsevier, vol. 124(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Oliver R. Browne & Ludovica Gazze & Michael Greenstone, 2021. "Do Conservation Policies Work? Evidence from Residential Water Use," Environmental and Energy Policy and the Economy, University of Chicago Press, vol. 2(1), pages 190-225.
    2. Pratt, Bryan, 2023. "A fine is more than a price: Evidence from drought restrictions," Journal of Environmental Economics and Management, Elsevier, vol. 119(C).
    3. Erik Ansink & Carmine Ornaghi & Mirco Tonin, 2021. "Technology vs information to promote conservation: Evidence from water audits," BEMPS - Bozen Economics & Management Paper Series BEMPS80, Faculty of Economics and Management at the Free University of Bozen.
    4. Stefano Clò & Tommaso Reggiani & Sabrina Ruberto, 2023. "Consumption feedback and water saving: An experiment in the metropolitan area of Milan," MUNI ECON Working Papers 2023-02, Masaryk University, revised Aug 2024.
    5. Goetz, Alexander & Mayr, Harald & Schubert, Renate, 2024. "One thing leads to another: Evidence on the scope and persistence of behavioral spillovers," Journal of Public Economics, Elsevier, vol. 236(C).
    6. Stefano Clò & Tommaso Reggiani & Sabrina Ruberto, 2024. "Consumption Feedback and Water Saving: A Field Intervention Evaluation in the Metropolitan Area of Milan," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 87(9), pages 2259-2308, September.
    7. Kastoryano, Stephen & Vollaard, Ben, 2022. "Nautical Patrol and Illegal Fishing Practices," Other publications TiSEM c02852eb-237c-4c6b-af7c-9, Tilburg University, School of Economics and Management.
    8. Pratt, Bryan, 2020. "Property Tenure and Determinants of Sensitivity to Price and Non-Price Conservation Instruments," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304283, Agricultural and Applied Economics Association.
    9. Tonke, Sebastian, 2024. "Providing procedural knowledge: A field experiment to encourage resource conservation in Namibia," Journal of Development Economics, Elsevier, vol. 166(C).
    10. Yingfei Mu & Edward A. Rubin & Eric Zou, 2021. "What’s Missing in Environmental (Self-)Monitoring: Evidence from Strategic Shutdowns of Pollution Monitors," NBER Working Papers 28735, National Bureau of Economic Research, Inc.
    11. Kastoryano, Stephen & Vollaard, Ben, 2023. "Unseen annihilation: Illegal fishing practices and nautical patrol," Journal of Environmental Economics and Management, Elsevier, vol. 122(C).
    12. Wang, Jingjing & Chermak, Janie M., 2021. "Is less always more? Conservation, efficiency and water education programs," Ecological Economics, Elsevier, vol. 184(C).
    13. Elinder, Mikael & Hu, Xiao & Liang, Che-Yuan, 2021. "Water conservation and the common pool problem: Can pricing address free-riding in residential hot water consumption?," CERE Working Papers 2021:12, CERE - the Center for Environmental and Resource Economics.
    14. Jessoe, Katrina & Lade, Gabriel E. & Loge, Frank & Spang, Edward, 2021. "Residential water conservation during drought: Experimental evidence from three behavioral interventions," Journal of Environmental Economics and Management, Elsevier, vol. 110(C).
    15. Joshua Hall & Kaitlyn Harger & Dean Stansel, 2015. "Economic Freedom and Recidivism: Evidence from US States," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 21(2), pages 155-165, May.
    16. Francesco Drago & Roberto Galbiati & Francesco Sobbrio, 2020. "The Political Cost of Being Soft on Crime: Evidence from a Natural Experiment," Journal of the European Economic Association, European Economic Association, vol. 18(6), pages 3305-3336.
    17. Andrew Dustan & Stanislao Maldonado & Juan Manuel Hernandez-Agramonte, 2018. "Motivating bureaucrats with non-monetary incentives when state capacity is weak: Evidence from large-scale field experiments in Peru," Working Papers 136, Peruvian Economic Association.
    18. Francesco Drago & Roberto Galbiati & Francesco Sobbrio, 2020. "The Political Cost of Being Soft on Crime: Evidence from a Natural Experiment," Journal of the European Economic Association, European Economic Association, vol. 18(6), pages 3305-3336.
    19. Bonan, J. & Cattaneo, C. & d’Adda, G. & Galliera, A. & Tavoni, M., 2024. "Widening the scope: The direct and spillover effects of nudging water efficiency in the presence of other behavioral interventions," Journal of Environmental Economics and Management, Elsevier, vol. 127(C).
    20. Holladay, Scott & LaRiviere, Jacob & Novgorodsky, David & Price, Michael, 2019. "Prices versus nudges: What matters for search versus purchase of energy investments?," Journal of Public Economics, Elsevier, vol. 172(C), pages 151-173.

    More about this item

    Keywords

    Field Experiment ; Automated Enforcement ; Remote Sensing ; Water Conservation JEL Codes: Q25 ; K42;
    All these keywords.

    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wrk:warwec:1440. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Margaret Nash (email available below). General contact details of provider: https://edirc.repec.org/data/dewaruk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.