Why Did US Air Pollution Decline After 1970?"
Ross McKitrick, University of Guelph Department of Economics
ABSTRACT:
US economic growth and air pollution were decoupled after 1970. Possible
explanations include regulation, oil price shocks, technology and income
growth. This paper uses VAR analysis to show that the 1970 Clean Air Act
may have actually increased pollution in the short run but led to
accelerated improvements in abatement technology. GDP and consumption
growth had little direct effect while oil price increases caused small but
significant emissions reductions. Recursive simulation shows that overall,
the CAA, by accelerating improvements in abatement technology, reduced
total emissions as of 1998 by 55% compared to what they would have been.
Empirical Economics
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