North-South Displacement Effects of Environmental Regulation: The Case of Battery Recycling
This study examines the effect of a tightening of the U.S. air-quality standard for lead in 2009 on the relocation of battery recycling to Mexico and on infant health in Mexico. In the U.S., airborne lead dropped sharply near affected plants, most of which were battery-recycling plants. Exports of used batteries to Mexico rose markedly. In Mexico, production increased at battery-recycling plants, relative to comparable industries, and birth outcomes deteriorated within two miles of those plants, relative to areas slightly farther away. The case provides a salient example of a pollution-haven effect between a developed and a developing country.
We thank Manuela Angelucci, Yutaka Arimoto, Shin-Yi Chou, Lucas Davis, Melissa Dell, Dave Donaldson, Manuel Estay, Alan Finkelstein, Laura Gee, Marco Gonzalez-Navarro, Gene Grossman, Rema Hanna, Danae Hernández-Cortés, Akira Hibiki, Koichiro Ito, Michael Klein, Michikazu Kojima, Arik Levinson, Enrique Martínez-García, Chris Moser, Junko Nishikawa, Toshihiro Okubo, Paulina Oliva, Rohini Pande, Sahar Parsa, Shomon R. Shamsuddin, Adam Storeygard, Santiago Saavedra, Masayuki Sawada, Dean Spears, Yoichi Sugita, Reed Walker, Shaoda Wang, Eric Zou, and participants at AEA-ASSA, AERE Summer Meeting, Ashecon, Asian Growth Research Institute, El Colegio de México, GRIPS, Hitotsubashi University, ITAM, JETRO-IDE, Keio University, Kindai University, Kwansei Gakuin University, Kyoto University, LACEA-Health Economics Network Meeting, LACEA-LAMES meeting, LACEA-TIGN, MIT, National institute for Environmental Studies in Japan, NBER Summer Institute, NEUDC, North American Summer Meeting of the Econometric Society, Northeast Workshop on Energy Policy and Environmental Economics, Osaka University, PacDev, RIDGE Environmental Economics Workshop, Rosenkranz Global Health Policy Symposium, Southern Economic Association Annual Meeting, Tohoku University, Tufts University, University of Tokyo, and Waseda University for helpful comments and discussions. Some results were produced using data at the INEGI Laboratorio de Microdatos (project LM 986); we thank Natalia Volkow at INEGI for her assistance. We are grateful to David Alfaro-Serrano, Yuki Kanayama, Sofia Ramírez, Omar Trejo and Paola Ugalde Araya for excellent research assistance. Financial support from JSPS KAKENHI (Grant Number 18K19955) is gratefully acknowledged. The usual disclaimer applies. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
- After the United States restricted lead emissions, the Mexican lead-acid battery-recycling industry expanded rapidly, and the...