US Water Pollution Regulation over the Last Half Century: Burning Waters to Crystal Springs?

David A. Keiser, Joseph S. Shapiro

NBER Working Paper No. 26077
Issued in July 2019, Revised in September 2019
NBER Program(s):Development of the American Economy, Environment and Energy Economics, Health Economics, Public Economics

In the half century since the founding of the U.S. Environmental Protection Agency, public and private U.S. sources have spent nearly $5 trillion ($2017) to provide clean rivers, lakes, and drinking water, or annual spending of 0.8 percent of U.S. GDP in most years. Yet over half of rivers and substantial shares of drinking water systems violate standards, and polls for decades have listed water pollution as Americans’ number one environmental concern. We assess the history, effectiveness, and efficiency of the Clean Water Act and Safe Drinking Water Act, and obtain four main conclusions. First, water pollution has fallen since these laws, in part due to their interventions. Second, investments made under these laws could be more cost-effective. Third, most recent studies estimate benefits of cleaning up pollution in rivers and lakes which are less than their costs, though these studies may under-count several potentially important types of benefits. Analysis finds more positive net benefits of drinking water quality investments. Fourth, economic research and teaching on water pollution is relatively uncommon, as measured by samples of publications, conference presentations, and textbooks.

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Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w26077

Published: David A. Keiser & Joseph S. Shapiro, 2019. "US Water Pollution Regulation over the Past Half Century: Burning Waters to Crystal Springs?," Journal of Economic Perspectives, American Economic Association, vol. 33(4), pages 51-75, Fall. citation courtesy of

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