Limiting Environmental Regs Raises Fears of ‘Race to the Bottom’

Daniel Millimet, an environmental economist at SMU, talks about fears that increased environmental regulations will hurt the Texas economy.

By Dave Fehling

Texas likes to be “business friendly” and as the state legislature considers bills to limit environmental regulation to keep it that way, some economists warn of the longer term consequences.

“It’s not as simple as saying yeah, it’s a negative for everybody and everybody is going to move out of the state if we have more stringent regulation,” said Daniel Millimet, an environmental economist at Southern Methodist University in Dallas.
The idea that too much regulation can scare off business has been a main thrust of some of the state’s environmental regulators like David Porter, one of the three elected leaders of the Texas Railroad Commission. . .

Millimet . . . said he too finds no clear evidence that relaxed pollution regulation increases overall employment and therefore he says there’s a risk in pursuing state policies based on the belief.
“We may undercut our regulation here in Texas even though it doesn’t actually influence decisions firms are actually making,” said Millimet.

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