Leah G. Traub

Under most federal environmental laws and some health and safety laws, states may apply for "primacy," that is, authority to implement and enforce federal law, through a process known as "authorization." Some observers fear that states use authorization to adopt more lax policies in a regulatory "race to the bottom." This paper presents a simple model of the interaction between the federal and state governments in such a scheme of partial decentralization. Our model suggests that the authorization option may not only increase social welfare but also allow more stringent environmental regulations than would otherwise be feasible. Our model also suggests that the federal government may choose its policies so that states that desire more strict regulation authorize, while other states remain ...

Published: International Review of Law and Economics Volume 37, March 2014, Pages 39–50 citation courtesy of