Environmental Policy

Critical Research Questions and Findings

Society’s future wellbeing depends on sustaining Earth’s environment. Yet for environmental solutions to gain consensus, they must also account for economic impact. USC Price School faculty balance these concerns as they examine climate change and related issues, the growing risks to vulnerable populations, and the economic impact of their effect.

How can technology, policy, and behavioral changes reduce energy use by households in the U.S.?

Focusing on energy choices made at the household level, which accounts for 38 percent of energy use in the U.S., Professor Daniel A. Mazmanian — academic director of the USC Schwarzenegger Institute for State and Global Policy — Research Assistant Professor Nicole Sintov, and several research assistants and Price colleagues are studying direct energy use as well as energy use embedded in water usage, food, transportation, and all such choices being made by individuals and families. They are also investigating how best to curb such energy use through behavioral, technological, and policy approaches.

What are the macroeconomic impacts of climate change mitigation policies?

Research Professor Adam Rose has analyzed the macroeconomic impacts of climate-action plans for numerous governors, environmental protection departments, and public service commissions across the U.S. He found that all such plans had a slight economic impact — nearly always positive — demonstrating they were neither job killers nor a panacea.

How do you design appropriate policy governance responses to climate-change issues?

Research Professor Adam Rose studies the wide range of approaches taken by nations, states, and communities on how to mitigate climate change by encouraging renewable-energy development, energy efficiency, and transportation planning. He also studies which level of government can best design policies to implement each mitigation option.

How can the diminishing resource of water best be preserved in drought-plagued Southern California?

Research Professor Hilda Blanco found that, compared to imported water, groundwater is vastly cheaper, uses less energy to obtain, and is less carbon-intensive. In addition, as climate change takes effect over time, groundwater supplies will be less subject to increasing evaporation due to temperature increases. However, the challenge of cleaning up its contamination in many groundwater basins remains significant and must be addressed.

How should water be priced more effectively to promote conservation?

While economists have long urged that the more water used, the more expensively it should be priced, Research Professor Hilda Blanco found that many communities do not have such conservation pricing in place. Complicating matters, a California appellate court ruled in April 2015 against tiered pricing formulas, declaring that San Juan Capistrano’s water agency’s tiered pricing was unconstitutional. Blanco is examining the types of conservation pricing and how communities wanting to implement such pricing schemes can withstand future court challenges.

Does light rail measurably reduce automobile usage?

Professor Marlon Boarnet recruited nearly 200 households for a study of travel behavior around new light rail stations on the Exposition Line in traffic-clogged Los Angeles. He found that households living within half a mile of the stations traveled 10 to 12 fewer miles by car each day — a 40% decrease — after the new rail line opened, producing nearly 30% less carbon emissions than study households who lived farther away.

Do mixed land use, transit access, and regional employment decrease driving and associated greenhouse gas emissions?

In a report prepared for the California Air Resources Board, Professor Marlon Boarnet found that mixed land uses (combining housing, shopping, and other activities in a small area), transit access, and good access to regional employment opportunities were all associated with less driving. Conversely, increasing the capacity of roads and highways — a method sometimes used by suburban projects to meet requirements of the California Environmental Quality Act — actually increased driving. This research informed the implementation of California Senate Bill 375, which requires metropolitan planning organizations to develop strategies for reducing greenhouse gas emission from passenger vehicles.

What are the costs and benefits of fuel economy regulations for passenger vehicles and light trucks?

In transportation systems with unpriced congestion, Professor Antonio Bento found that encouraging the purchase of low-emission vehicles by allowing their single-occupant use in high-occupancy vehicle (HOV) lanes exacerbates congestion costs for carpoolers. The resulting welfare effects of the policy are negative, with environmental benefits overwhelmingly dominated by the increased congestion costs. Exploiting the introduction of the Clean Air Vehicle Stickers policy in California with a regression discontinuity design, Bento’s results imply a best-case cost of $124 per ton of reductions in greenhouse gases, $606,000 dollars per ton of nitrogen oxides reduction, and $505,000 per ton of hydrocarbon reduction — exceeding those of other options readily available to policymakers.

What are the costs of carbon offsets and cap-and-trade, and would real emissions reductions result?

Professor Antonio Bento — a contributing author to the Intergovernmental Panel on Climate Change — addresses these fundamental questions in U.N. negotiations by measuring the costs, distributional impact, and environmental impact of average fuel economy standards. Referencing the 1990 Clean Air Act, he found that the benefits were progressive. He determined that households in the lowest quintile of income distribution received annual benefits more than twice as large as those in the highest quintile.

How do companies in China respond to incentives and pressures to meet environmental regulations?

Professor Shui Yan Tang found that corporate environmental practices are affected by corporate executives’ perceptions of political commitment to environmental protection, policy uncertainty in regulatory requirements, and enforcement efforts of local officials.

What are the equity impacts of environmental policy?

Professor Antonio Bento examined potentially important trade-offs between efficiency and equity that arise in the context of environmental policy implementation. In many of the applications surveyed, he found environmental policies can be regressive, so he proposed strategies to reduce this problem through revenues from certain policy instruments. He concluded that more spatially disaggregated studies are needed that simultaneously capture the spatial and socioeconomic impacts of environmental policy.

How can nations work together to address climate change?

Under the leadership of Professor Daniel A. Mazmanian, academic director of the USC Schwarzenegger Institute for State and Global Policy, USC Price partners in a research consortium with the Hertie School of Governance in Berlin and Tsinghua University in Beijing to better understand and promote effective approaches to global climate change policy by 2050. China is particularly interested in learning from measures taken by the United States and Europe on this issue.

What roles must China and the U.S. take in addressing climate change?

While in Asia, where he finalized a memorandum of understanding between USC Price and the Nanyang Centre for Public Administration at Nanyang Technological University, Professor Eric Heikkila observed that, if the two leading emitters fail to agree and provide leadership on the issue, no other nation can be expected to succeed. He detailed institutional mechanisms, including cap-and-trade and the carbon tax, which could help address the problem. Heikkila also looked at the role of the U.S. and China in organizations such as the United Nations Framework Convention for Climate Change, which was ratified by 195 countries.

Daniel A. Mazmanian

“California is a first mover in developing strategies that improve our environment and often serves as a model for other states and nations.”

Professor Daniel A. Mazmanian
Academic Director, USC Schwarzenegger Institute for State and Global Policy

Price School Impact

Whether collaborating with partner institutions in Germany and China on the transition to renewable energy by 2050, presenting research to the L.A. Regional Water Quality Control Board, or serving as contributing authors to the Intergovernmental Panel on Climate Change, Price School faculty play major roles in developing evidence-based, economically viable solutions to major environmental challenges.

We also examine possibilities for voluntary regulation and collaboration across industry, government, and the nonprofit sector to arrive at answers that achieve maximum benefit.

One significant research effort of importance to drought-ridden California — the nation’s largest food supplier — focuses on groundwater policies. While the state has significant supplies of groundwater, many of the sources are contaminated. The issue is further complicated by the numerous agencies governing the supplies. USC Price faculty play an instrumental role in both research and advising the agencies on ways to collaborate and address common problems.