Regulator Attitudes and the Environmental Race to the Bottom Argument

Concerns that interstate economic competition will lead states to relax their environmental regulation, potentially resulting in a race to the bottom, remain commonplace in both academic and public policy debates about state environmental policy. Most of the existing empirical work examining the race to the bottom argument tests the behavioral predictions of the argument. In this article, I focus on the attitudinal predictions. Specifically, I examine whether state regulators express beliefs consistent with what we would expect to observe if a race to the bottom dynamic operates within state regulatory decision making. Studying data from the State Environmental Managers Survey, I find that state regulators are sensitive to the effects that their regulatory decisions have on industry investment decisions and that their agencies are influenced by the regulatory decision making of economic competitor states.