Study Suggests Environmental Policies May Not Impact Economy
State environmental policies may not influence the economy one way or another, according to a study conducted by a political science professor at the Massachusetts Institute of Technology.
Stephen M. Meyer set out to examine the theory that the pursuit of environmental quality, or "environmentalism," hinders opportunities for substantial economic growth and development. Further, he pondered the questions of whether states with stronger environmental standards would lag economically behind states with weaker standards, and whether progress hinged on a choice between jobs and the environment.
In his initial report, issued in fall 1992, "states with higher environmental rankings outperformed states with lower environmental rankings in four of five economic growth indicators. This surprising yet solid finding allows us to dismiss the environmental impact hypothesis with even greater confidence."
While students of the study could have concluded that environmentalism boosts an economy, Meyer cautioned that view wasn't necessarily a foregone conclusion. Sure enough, in an updated supplemental report issued in February, he said the research data could not be interpreted to show that stronger environmental standards produce stronger economic growth.
When Meyer embarked on his research project, he said he expected to find a small-to-modest negative association between environmentalism and economic prosperity. "In other words, the economic performance of states with stronger environmental standards would not measure up to that of states with weaker environmental standards," the update report said.
"This would have confirmed the prevailing political wisdom at the time."
Meyer used five "primary indicators of economic growth and prosperity" for his research: gross state product, total non-farm employment, construction employment, manufacturing labor productivity and overall labor productivity.
"Those who live and work in states that have vigorously pursued environmental quality and are now contemplating rolling back environmental standards as a quick fix to jump-starting their economies out of recession should reconsider," the report said.
Meyer concluded that stronger environmental standards implemented over the past 20 years were "economy neutral." On the whole, they neither hindered nor helped the economy, he said. "On a state-to-state basis, measurable economic growth has not been stifled, state competitiveness has not been undermined and jobs have not been sacrificed at the altar of environmentalism," he said.
The results could indicate a "dynamic balance," Meyer said. That means the number of industries hurt by stronger environmental controls could have been offset by the number that prospered under stronger controls. "The latter are likely to be more modern, vigorous and competitive industries and firms," he said.
To blame environmental regulations for dampening the economy is to focus on "what is certainly one of the least influential factors affecting the pace of economic growth and development," the report said. "The benefits of environmental protection are obvious and demonstrable. It is clear from the data and analyses presented in this report that the states can pursue environmental quality without fear of impeding economic prosperity.
For those who continue to argue that environmentalism hurts economic growth and prosperity, the burden of proof now clearly falls on their shoulders," Meyer said. . . Department of Environmental Quality Officially Opens
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