EPA enforcement, firm response strategies, and stockholder wealth: an empirical examination
Article Abstract:
The impact of the Environmental Protection Agency's (EPA) enforcement activities on pollution control cause stockholders to lose wealth if the related costs reduce the firm's expected profit stream. The market of a firm that has been targeted by EPA for possible violation of anti-pollution regulations is affected negatively. These firms face statistically marked abnormal price reductions after the EPA announcement. Meanwhile, compliance with the EPA guarantees expectations of smaller costs relative to those acquired by fighting. The stockholders' loss for settling firms is around 40% less than that for the non-settling firms.
Publication Name: Managerial & Decision Economics
Subject: Economics
ISSN: 0143-6570
Year: 1998
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EPA's Toxic Release Inventory: stimulus and response
Article Abstract:
The Toxic Release Inventory program of the Environmental Protection Agency can do little to encourage compliance among firms due to the perceived gap between the perceived and actual risk of pollutants. The compliance exhibited by the firms are more likely the result of political or market pressures, especially when the firm's 'polluting' facility is located in an area where residents are environmentally conscious. This is perceived to be the driver of a firm's research into pollution control.
Publication Name: Managerial & Decision Economics
Subject: Economics
ISSN: 0143-6570
Year: 1997
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