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Abstract
This paper revisits the 'jobs versus the environment' debate and provides the first analysis for a country other than the US. We firstly examine the impact of environmental regulations on employment assuming such regulations are exogenous. However, for the first time in a study of this nature, we then allow environmental regulation costs and employment to be endogenously determined. Environmental regulation costs are not found to have a statistically significant effect on employment whether such costs are treated as being exogenous or endogenous. We therefore find no evidence of a trade-off between jobs and the environment.

THE AUTHOR DISCUSSES ENFORCEMENT COSTS IN ENVIRONMENTAL AND SAFETY REGULATION, AND SUGGESTS THAT SUCH COSTS ARE TOO OFTEN OVERLOOKED IN THE POLICYMAKING PROCESS. METHODOLOGICAL AIDS FOR DECISIONS INVOLVING ENFORCEMENT ISSUES ARE EXAMINED, INCLUDING ECONOMETRIC EVALUATIONS OF EXISTING REGULATIONS THAT ALLOW FOR ENFORCEMENT.

Conventional discounting guidelines for federal agencies, which dictate a 10% discount rate for evaluating federal environmental action, & the "shadow price of capital" are both superseded by a discounting procedure reported here. Discounting the benefits & costs of government actions is necessary to offset the costs of using private sector resources for public purposes. The new procedure described appears to yield accurate results, but is simpler, involving only two stages: (1) annualizing capital expenditures (in this case, for pollution control devices) over the product's or activity's lifetime, adding in annual operating expenditures; & (2) discounting the benefit & cost streams by the social rate of time preference. This new model is operationalized using data on rates of return on 10-year US Treasury bills & Corporate Aaa bonds from 1946 to 1980. Results from the two-stage procedure were significantly different from those obtained via conventional discounting, which, as is shown, can result in undervaluation of the cost-benefit ratio of environmental regulations. 3 Tables, 12 References. C. Grindle

This paper addresses the question why a lot of firms demand stricter environmental regulation. With non-identical producers within the same industry, lobbying for tighter environmental rules turns out to be an important strategy of raising rivals' costs. Furthermore, the paper explains when the potential target firms of stricter regulation in such an intra-industrial competition engage in counter-lobbying and when they remain silent.