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Information regulation: Do the victims of externalities pay attention?

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Abstract

Individuals living in metropolitan areas are exposed to a large number of industrial risks. Information regulation is a new tool to manage such risks. We ask if large-scale information initiatives directed at the general public can affect individual risk perceptions. The answer is affirmative. Using the publication of the Toxics Release Inventory as a case study, we find a decline in predicted property values when new information on pollution became available, indicating that homebuyers adjusted their risk perceptions upward. The response, however, is limited to sources of toxic emissions that are located at a moderate distance from the properties in our sample.

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Authors and Affiliations

  1. Harvard University, 213 Morgan Hall, Soldiers Field, Boston, MA, 02163, USA

    Felix Oberholzer-Gee

  2. Business Innovation Center, Mizuho Information and Research Institute Inc, 2-3 Kandanishiki-cho Chiyoda-ku, Tokyo, 101-8443, Japan

    Miki Mitsunari

Authors
  1. Felix Oberholzer-Gee
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  2. Miki Mitsunari
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Correspondence to Felix Oberholzer-Gee.

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Oberholzer-Gee, F., Mitsunari, M. Information regulation: Do the victims of externalities pay attention?. J Regul Econ 30, 141–158 (2006). https://doi.org/10.1007/s11149-006-0016-3

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  • DOI: https://doi.org/10.1007/s11149-006-0016-3

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