Blackman, Allen, Bidisha Lahiri, William Pizer, Marisol Rivera Planter and Carlos Muños Piña. 2009. “Voluntary Environmental Regulation in Developing Countries: Mexico’s Clean Industry Program.” RFF Discussion paper 07-36.
Because conventional command-and-control environmental regulation often performs poorly in developing countries, policymakers are increasingly experimenting with alternatives, including state-sponsored voluntary regulatory programs that provide incentives, but not mandates, for pollution control.
The authors use plant-level data on more than 60,000 facilities to analyze the Clean Industry Program, Mexico’s flagship voluntary regulatory initiative. Their results suggest that although the Clean Industry Program attracted dirty plants under pressure from regulators, it did not have a lasting impact on their environmental performance.