Transcript Waiting to Be Protected under Endangered Species Act: The

Waiting to Be Protected under
Endangered Species Act: The
Political Economy of
Regulatory Delay
Amy Whritenour Ando
Roadmap
• Interest groups have a variety of tools to
affect the administrative process directly
through petitions and comments, or
indirectly through representatives.
• Used effectively to delay or hasten
progress of species through the listing
process.
• Delay of listing a species has implications
for costs and benefits.
Endangered Species Act 1973
• Listing decisions in
theory supposed to be
based on scientific
evidence.
• Study focuses on C1 and
Proposal.
• Observe chronic backlog
in C2 and C1.
Costs & Benefits
• ( - ) Long delays reduce ability for species to
survive. Species have been thought to have
become extinct while waiting.
(-/+) Delay diminishes the benefits of listing, but
also the costs (ex. property owners)
• Timing: delay in early stages makes species
less likely to advance and more likely to be
demoted.
Agents on both sides will either try to delay or
hasten process dependant on their costs and
benefits.
Empirics
• 1988-1995 data
• Time waiting on (1) congressional
representation (2) federal priority
designation (3) comments (4) other public
pressure (5) species characteristics.
• Regressions for both C1 and Proposal
periods.
C1 Results
Observations from C1
1. Petitions reduce amount of waiting time.
2. Longer initial delays increase the
likelihood of demotion.
3. Having a representative on a key
subcommittee matters* (Identification
issue).
4. Federal listing-priority system matters.
5. Species characteristics are not
significant (in accordance with policy)
More Results
6. In Proposal period delay does not doom
promotion as in C1
7. Subcommittee representation and priority
index are not important anymore.
8. Delay postpones and changes the
cost/benefits.
Itself influences the prob. of promotion.
Self Regulation and Social
Welfare: The Political
Economy of Corporate
Environmentalism
John W. Maxwell, Thomas P.
Lyon, Steven C. Hackett
Background
• 1988-1992: Shipments rise, while toxics
drop sharply without govt. regulation =>
• Strategic behavior? Firm self regulation
as a means to preempt govt. regulation.
• Self regulation itself a response to the
threat of external regulation.
Game
• Firms abatement choice as a function of
political pressures, which in turn depend
on consumers costs of organizing.
• Determines whether costs of preempting
outweigh those of regulation.
• Firms can take advantage of consumer
organizing, lobbying, and other fixed costs.
• How can they?
Welfare Analysis
• Voluntary abatement costs nothing to
consumers, and firms can abate less.
Pareto improving
• Without voluntary abatement consumers devote
more resources to lobbying but with diminishing
returns. Marginal cost of lobbying and organizing
are high in relation to the benefits.
• We also see a stronger free-rider effect amongst
consumers. Drag on welfare.
Implications
• If preemption occurs, it must be profitable
for firm and will necessarily be better for
consumers than the “influence game”
welfare outcome. (previous result)
– So firms should be encouraged to cooperate
voluntary efforts.
– Govt. shouldn’t subsidize consumer
involvement because it reduces costs and
makes firm preemption unprofitable.
Empirics: Toxics Data (1988-1992)
• Does the threat of regulation induce self
regulation? Yes
• Regress toxic emissions on:
– (1)geo/climate (2) socioeconomic (3) industry characteristics (4) general
business climate (5) legal climate (6)state attitudes
• Three main determinants:
– presence of high emissions and strong environment
group membership.
– state has smaller number of plants. (free riding)
– higher values of manufacturing shipments.
Conclusions
•
States with higher initial levels of pollution and
larger environmental group membership
reduce emissions more rapidly.
Why? =>
Low marginal abatement costs, higher
marginal value of abatement, and consumer
organizing costs are low.
And =>
Threat of regulation is high. Low cost of self
regulation in comparison.
More Conclusions
• Firm can more easily deter consumer
action if consumers face high costs
(Superfund 1986 lowered info costs,
forced large reductions).
• Social welfare under preemption Pareto
dominates non-preemption scenario when
interest play “influence game”.