| Title: |
The Unintended Externalities of an Environmental Regulation: Evidence from the NOx Budget Trading Program |
| Authors: |
Zhou, Y; Lin, TC; Zou, H |
| Publisher Information: |
Financial Management Association.; United States |
| Publication Year: |
2022 |
| Collection: |
University of Hong Kong: HKU Scholars Hub |
| Description: |
Exploiting NOx Budget Trading Program (NBP) implementation, we show that such a regional environmental regulation has unintended effects on the emission policies of manufacturing plants unregulated by the NBP via the pass-through of higher electricity prices. High energy-consuming manufacturers with tighter constraints or stronger incentives to maintain high earnings cut corners by reducing costly abatements to absorb the NBP-induced increase in energy input cost. The increased emissions worsen air quality within the 1-mile radius of manufacturing plants, which are mainly neighborhoods of underprivileged communities. While the NBP improves overall air quality, it also yields negative externalities along the supply chain. |
| Document Type: |
conference object |
| Language: |
English |
| Relation: |
339386; https://hub.hku.hk/handle/10722/319799 |
| Availability: |
https://hub.hku.hk/handle/10722/319799 |
| Accession Number: |
edsbas.E54FCC97 |
| Database: |
BASE |