This paper investigates how a common form of environmental regulation—air quality standards—affects exporters. We develop a simple theoretical model to show how the design of these standards causes (i) some firms to stop exporting and (ii) a reduction in the export volumes of affected continuing exporters. We exploit quasi-experimental variation resulting from the design of Canadian air quality standards to test these predictions empirically. Our estimates confirm our model's predictions: we find that for the most affected manufacturers, regulation reduced export volumes by 32 percent and increased the likelihood plants stop exporting by 5 percentage points.
Cherniwchan, Jevan, and Nouri Najjar.
"Do Environmental Regulations Affect the Decision to Export?"
American Economic Journal: Economic Policy,
Consumer Economics: Empirical Analysis
Empirical Studies of Trade
Trade and Environment
Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
Environmental Economics: Government Policy