This paper examines whether US gasoline content regulations, which impose substantial costs on consumers, have successfully reduced ozone pollution. We take advantage of spatial and temporal variation in the regulations' implementation to show that federal gasoline standards, which allow refiners flexibility in choosing a compliance mechanism, did not improve air quality. This outcome occurred because minimizing the cost of compliance does not reduce emissions of those compounds most prone to forming ozone. In California, however, we find that precisely targeted, inflexible regulations requiring the removal of particularly harmful compounds significantly improved air quality.

We compare the most common reduced-form models used for emissions forecasting, point out shortcomings, and suggest improvements. Using a U.S. state-level panel data set of CO2 emissions, we test the performance of existing models against a large universe of potential reduced-form models. We find that leading models in the literature, as well as models selected based on an emissions per capita loss measure or different in-sample selection criteria, perform significantly worse compared to the best model chosen based directly on the out-of-sample loss measure defined over aggregate emissions.

Current forecasts suggest that the vast majority of growth in energy demand will come from the developing world, and that China will play a major part in that growth. This paper presents evidence suggesting that the shape of the income distribution, which is typically omitted from forecasting models, plays a major role in driving household acquisition of energy-using durable goods in rural China. We use province-level data for rural households to show that the share of the population living above the poverty line is an important determinant of household appliance holdings even controlling for average household income.

We synthesize and review retrospective analyses of federal air quality regulations to examine the contributions of the Clean Air Act (CAA) to the vast air quality improvements seen since 1970. Geographic heterogeneity in stringency affects emissions, public health, compliance costs, and employment. Cap-and-trade has delivered greater emission reductions at lower cost than conventional mandates, yet has fallen short of textbook ideals. Market power also influenced the CAA’s benefits and costs. New benefit categories have been identified ex post, but specific technology requirements have not yet been rigorously evaluated. Comparisons of aggregate benefits and costs of the CAA are beyond present capabilities.