Adoption of ISO 14001 Standards in Indian Manufacturing Firms

Voluntary environmental initiatives (VEIs) by firms are often viewed as important for environmental management in developing countries such as India with weak regulatory institutions and poor enforcement of environmental laws. Past research shows that while VEIs may not be able to fully substitute for strong regulation, they could be useful complements to reduce environmental degradation in developing countries. In India, new government initiatives such as “Make in India” are geared towards significantly increasing the manufacturing output in the next few years. In this context, our paper studies the adoption of a widely employed VEI - the ISO 14001 standards certification - among the Indian manufacturing industries. Using the theoretical framework of Earnhart, Khanna, and Lyon (2014) on the drivers of corporate environmental strategies in emerging economies, we hypothesize that the likelihood of adoption of ISO 14001 standards among Indian manufacturing industries is a function of internal firm characteristics, input and output market pressures, and regulatory pressure. We test our hypotheses using a survey of 1000 (large, medium, and small) manufacturing firms across the country, conducted under the aegis of the World Bank in 2016. Results show that internal firm characteristics such as large size and firm innovation have a positive association with the likelihood of adopting ISO 14001 standards. Output market pressures, such as exporting to foreign markets, also positively impact the likelihood of obtaining ISO 14001 certification. In particular, exporting to China, which is ranked first in the number of ISO 14001 adoptions, has a statistically significant impact on probability of adoption. There is no evidence, however, that predominantly consumer-facing firms, another potential indicator of output market pressure, are more likely to adopt ISO 14001 standards. We also find state-fixed effects, potentially capturing the variation in both formal and informal regulatory pressure across states. Thus, consistent with other research in developing countries, we find that pressure to meet the environmental standards of countries to which firms in developing countries export their products acts as a strong incentive to adopt VEIs such as ISO 14001 standards. The lack of evidence that consumer-facing firms are no more likely to adopt ISO 14001 standards potentially indicate that firms in India do not yet find the green consumer markets large enough to adopt VEIs

Spatial Regulation of Air Toxics Hot Spots

This paper analyzes the potential implications, in terms of net social costs and distribution of risks and abatement costs, of a policy to address the problem of air toxics “hot spots.” The policy we analyze involves regulation of air toxics sources at increasingly finer spatial resolutions. We develop a model of a decisionmaker choosing emission standards within a net cost minimization framework. Empirical application of the model to two counties in Florida demonstrates that regulation at finer resolutions could involve trade-offs between net social costs and equitable distribution of risks and, in some settings, between individual and population risks

Hot Spots Regulation and Environmental Justice

This paper analyzes whether regulating “hot spots” of toxic air pollution by increasing the spatial resolution of regulation could address environmental justice (EJ) concerns. To examine this question, this paper develops a decision model of a regulator choosing emission controls within a net cost minimizing framework. An empirical application of the model using air toxic emission data for Escambia and Santa Rosa Counties in Florida estimates the emission standards and spatial distribution of risks at a coarse and a finer spatial resolutions. Implications for EJ are analyzed by combining the simulated spatial risk distributions at the two resolutions with the demographic data. Results indicate that different measures of EJ point to different conclusions regarding the question of whether finer resolution regulation alleviates EJ concerns. The paper concludes with a discussion of the implications for EJ policy

Superfund, Hedonics, and the Scales of Environmental Justice

Environmental justice (EJ) is prominent in environmental policy, yet EJ research is plagued by debates over methodological procedures. A well-established economic approach, the hedonic price method, can offer guidance on one contentious aspect of EJ research: the choice of the spatial unit of analysis. Environmental managers charged with preventing or remedying inequities grapple with these framing problems. This article reviews the theoretical and empirical literature on unit choice in EJ, as well as research employing hedonic pricing to assess the spatial extent of hazardous waste site impacts. The insights from hedonics are demonstrated in a series of EJ analyses for a national inventory of Superfund sites. First, as evidence of injustice exhibits substantial sensitivity to the choice of spatial unit, hedonics suggests some units conform better to Superfund impacts than others. Second, hedonic estimates for a particular site can inform the design of appropriate tests of environmental inequity for that site. Implications for policymakers and practitioners of EJ analyses are discussed

Hot spots regulation and environmental justice

This paper analyzes whether regulating "hot spots" of toxic air pollution by increasing the spatial resolution of regulation could address environmental justice (EJ) concerns. To examine this question, this paper develops a decision model of a regulator choosing emission controls within a net cost minimizing framework. An empirical application of the model using air toxic emission data for Escambia and Santa Rosa Counties in Florida estimates the emission standards and spatial distribution of risks at a coarse and a finer spatial resolutions. Implications for EJ are analyzed by combining the simulated spatial risk distributions at the two resolutions with the demographic data. Results indicate that different measures of EJ point to different conclusions regarding the question of whether finer resolution regulation alleviates EJ concerns. The paper concludes with a discussion of the implications for EJ policy.Environmental justice Air toxics Spatial resolution

Scales of justice: Is there a geographic bias in environmental equity analysis?

Many empirical environmental justice (EJ) studies lack a systematic framework in which to undertake research and interpret results. This paper characterizes the conventional EJ study and examines how results can be influenced by the choice of the spatial scale and scope of analysis. After thoroughly reviewing a sample of prominent EJ studies, a conventional EJ study was performed for (Superfund) National Priorities List sites at multiple scales and scopes. It was found that evidence of environmental injustice could be sensitive to scale and scope chosen, which partly explains the observed inconsistency in the empirical literature. Implications for interpreting existing EJ research and conducting future EJ research are discussed.