The effect of compliance assistance on pollution discharges and violations of environmental regulations

Abstract

Researchers and policymakers assert competing behavioral models of polluters. One model portrays polluters as best approximated by the perfectly informed, rational actor from economics textbooks. Another model portrays polluters, particularly small and medium facilities, as imperfectly informed, cognitively bounded, pro‐social actors. If this second model is more accurate, environmental programs that offer low‐cost technical assistance may be especially effective in promoting regulatory compliance. Yet the empirical evidence for the effectiveness of such compliance assistance is scant. In a pre‐registered analysis using panel data research designs, we exploit idiosyncratic program roll‐out to estimate the effects of a compliance assistance program that was delivered to hundreds of Ohio water polluters. Although the program was initially deemed a success by federal and state environmental protection agencies, we estimate that, if the program had any effect on polluter behaviors, those effects were small. In our preferred specification, we estimate a precise zero effect of compliance assistance on environmental compliance and pollution. The lack of evidence for behavioral impacts from compliance assistance does not imply such programs cannot be effective, but it does underscore the need for more deliberate evaluation designs when state and federal agencies roll out their compliance assistance interventions.