Title

Relief for the environment? The importance of an increasingly unimportant industrial sector

Date of this Version

4-1-2008

Document Type

Journal Article

Publication Details

Published Version.

Gassebner, M., Gaston, N., & Lamla, M. J. (2008). Relief for the environment? The importance of an increasingly unimportant industrial sector. Economic inquiry, 46(2), 160-178.

Access the publisher's website.

2008 HERDC submission. FoR Code: 1402

© Copyright Western Economic Association International, 2007

Abstract

Deindustrialization, stagnant real incomes of production workers, and increasing inequality are latter day features of many economies. It is common to assume that such developments pressure policymakers to relax environmental standards. However, when heavily polluting industries become less important economically, their political importance also tends to diminish. Consequently, a regulator may increase the stringency of environmental policies. Like some other studies, we find that declining industrial employment translates into stricter environmental standards. In contrast to previous studies, but consistent with our argument, we find that greater income inequality is associated with policies that promote a cleaner environment.

 

This document has been peer reviewed.