Application of Causal Inference Approaches in Environmental Policy Analysis

Jui Sen

doi:10.7273/000005098

My dissertation explores the application of various causal inference methods in the analysis of environmental policies concerning air, land, and water. In my first chapter, I compiled panel data sets on manufacturing plant-level weighted emissions to estimate the sign and magnitude of pollution spillovers in connection with the High Priority Violation Policy (HPVP). Using stacked event study analysis, I found that, on average, a compliant manufacturing plant decreased weighted air emissions by about 14.44% if there was a record of violation of its sister plant(s). In contrast, the plant increased cross-media weighted water emissions by about 24.42% associated with the concurrent violation status of its sister concern(s). Specifically, this study found evidence of both positive and negative spillover effects of HPV violations. In my second chapter, I examine whether easements increase the value of neighboring farmland. Agricultural conservation easements are a tool for preventing the development of farmland for residential, urban, or other commercial uses where farmland owners receive compensation for restrictions on future land use change. Previous studies have shown that the effect of easements extend beyond the preserved parcels. We build on this literature in two ways. First, I examine whether easements increase the value of neighboring farmland. Second, I analyze the effect of conservation easements in the Western U.S., which has received much less attention than the Eastern U.S. Using a generalized difference-in-difference regression framework, we analyze data from Skagit County in Washington State from the years 2002-2020 when about 15% of all cropland in the county received conservation easements as part of a local land trust program. I find that farmland conservation easements increase the sales price of neighboring farmland within a half-mile by 35%. In my third paper, I examine the impact of restrictions on outdoor water usage in residential areas on the preferences of potential homebuyers. To achieve this, I analyzed a dataset of 3,539 observations of house sales from Clallam County, WA, between 2009 and 2020, using a difference-in-differences approach. The findings suggest that homeowners are not overly concerned about using water outside. The study found evidence that homes built before 2013, which rely solely on indoor water use, experienced a decrease in value due to the implementation of the Dungeness water regulation.

Application of Causal Inference Approaches in Environmental Policy Analysis

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