Information As Regulation: The Effect of Community Right to Know Laws on Toxic Emissions

There is growing academic and policy-level interest in the use of information as quasi-regulatory mechanisms, such as toxic release inventory (TRI) and “green labels.” Mandatory disclosure requirements have been touted as “market-based incentives” that may affect firm behavior. We provide new eviden...

Full description

Saved in:
Bibliographic Details
Published in:Journal of environmental economics and management 1997-01, Vol.32 (1), p.109-124
Main Authors: Konar, Shameek, Cohen, Mark A.
Format: Article
Language:English
Subjects:
Access to information
Disclosure
Emissions
Environmental economics
Gas
Information management
Inventory
Manycompanies
Pollution
Public interest
Regulation
Right to know
Statistical analysis
Stock prices
Studies
Toxicity
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:There is growing academic and policy-level interest in the use of information as quasi-regulatory mechanisms, such as toxic release inventory (TRI) and “green labels.” Mandatory disclosure requirements have been touted as “market-based incentives” that may affect firm behavior. We provide new evidence on the effectiveness of disclosure requirements by examining firm behavior in response to disclosures of TRI emissions. We find that firms with the largest stock price decline on the day this information became public subsequently reduced emissions more than their industry peers. This is consistent with the view that financial markets may provide strong incentives for firms to change their environmental behavior.
ISSN:0095-0696
1096-0449
DOI:10.1006/jeem.1996.0955