1. Waiting to Be Protected under Endangered Species Act: The Political Economy of Regulatory Delay Amy Whritenour Ando

2. Roadmap Interest groups have a variety of tools to affect the administrative process directly through petitions and comments, or indirectly through representatives. Used effectively to delay or hasten progress of species through the listing process. Delay of listing a species has implications for costs and benefits.

3. Endangered Species Act 1973 Listing decisions in theory supposed to be based on scientific evidence. Study focuses on C1 and Proposal. Observe chronic backlog in C2 and C1.

4. Costs & Benefits ( - ) Long delays reduce ability for species to survive. Species have been thought to have become extinct while waiting. (-/+) Delay diminishes the benefits of listing, but also the costs (ex. property owners) Timing: delay in early stages makes species less likely to advance and more likely to be demoted. Agents on both sides will either try to delay or hasten process dependant on their costs and benefits.

5. Empirics 1988-1995 data Time waiting on (1) congressional representation (2) federal priority designation (3) comments (4) other public pressure (5) species characteristics. Regressions for both C1 and Proposal periods.

6. C1 Results

7. Observations from C1 1.Petitions reduce amount of waiting time. 2.Longer initial delays increase the likelihood of demotion. 3.Having a representative on a key subcommittee matters* (Identification issue). 4.Federal listing-priority system matters. 5.Species characteristics are not significant (in accordance with policy)

8. More Results 6.In Proposal period delay does not doom promotion as in C1 7.Subcommittee representation and priority index are not important anymore. 8.Delay postpones and changes the cost/benefits. Itself influences the prob. of promotion.

9. Self Regulation and Social Welfare: The Political Economy of Corporate Environmentalism John W. Maxwell, Thomas P. Lyon, Steven C. Hackett

10. Background 1988-1992: Shipments rise, while toxics drop sharply without govt. regulation => Strategic behavior? Firm self regulation as a means to preempt govt. regulation. Self regulation itself a response to the threat of external regulation.

11. Game Firms abatement choice as a function of political pressures, which in turn depend on consumers costs of organizing. Determines whether costs of preempting outweigh those of regulation. Firms can take advantage of consumer organizing, lobbying, and other fixed costs. How can they?

12. Welfare Analysis Voluntary abatement costs nothing to consumers, and firms can abate less. Pareto improving Without voluntary abatement consumers devote more resources to lobbying but with diminishing returns. Marginal cost of lobbying and organizing are high in relation to the benefits. We also see a stronger free-rider effect amongst consumers. Drag on welfare.

13. Implications If preemption occurs, it must be profitable for firm and will necessarily be better for consumers than the “influence game” welfare outcome. (previous result) –So firms should be encouraged to cooperate voluntary efforts. –Govt. shouldn’t subsidize consumer involvement because it reduces costs and makes firm preemption unprofitable.

14. Empirics: Toxics Data (1988-1992) Does the threat of regulation induce self regulation? Yes Regress toxic emissions on: –(1)geo/climate (2) socioeconomic (3) industry characteristics (4) general business climate (5) legal climate (6)state attitudes Three main determinants: –presence of high emissions and strong environment group membership. –state has smaller number of plants. (free riding) –higher values of manufacturing shipments.

15. Conclusions States with higher initial levels of pollution and larger environmental group membership reduce emissions more rapidly. Why? => Low marginal abatement costs, higher marginal value of abatement, and consumer organizing costs are low. And => Threat of regulation is high. Low cost of self regulation in comparison.

16. More Conclusions Firm can more easily deter consumer action if consumers face high costs (Superfund 1986 lowered info costs, forced large reductions). Social welfare under preemption Pareto dominates non-preemption scenario when interest play “influence game”.