Asbestos, leaded petrol, and other aberrations: comparing countries’ regulatory responses to disapproved products and technologies

ABSTRACT

Industrial innovation churns out increasingly unnatural products and technologies amid scientific uncertainty about their harmful effects. We argue that a quick regulatory response to the discovery that certain innovations are harmful is an important indicator for evaluating the performance of an innovation system. Using a unique hand-collected dataset, we explore the temporal geography of regulatory responses as evidenced by the years in which countries introduce bans against leaded petrol, asbestos, DDT, smoking in public places, and plastic bags, as well as introducing the driver’s seatbelt obligation. We find inconsistent regulatory responses by countries across different threats, and that countries’ level of economic development is often not a good predictor of early bans. Moreover, an early introduction of one ban is not strongly related to the relative performance in regard to another ban, which raises possible questions about the coherence of regulatory responses across different threats.

KEYWORDS:

• Innovation
• regulation
• government regulatory capacity
• innovation systems
• ban
• manufacture of doubt

JEL:

• O38

Acknowledgments

We are indebted to Andries Brandsma, Adrian Ely, Koen Jonckers, Jose Manuel Leceta, Robin Mansell, Aleksandar Mihajlovski (FAO), Erik Millstone, Karoline Rogge, Serdar Türkeli, Bruno Turnheim, Daniel Vertesy, Antonio Vezzani, and participants at the SPRU 50^th Anniversary Conference (Sept 2016), EMAEE (Strasbourg, June 2017), and UNU-MERIT (Maastricht, May 2019), and the Editor (Anders Broström) and two anonymous reviewers for many helpful comments. Margherita Ceccanti and Angela Matteucci provided excellent research assistance. The usual caveat applies.

Disclosure statement

No potential conflict of interest was reported by the authors.

Supplementary material

Supplemental data for this article can be accessed here.

Notes

¹ Meanwhile, through the lens of a natural experiment, the Amish – a society that has rejected modern technologies – have lower rates of asthma (Holbreich et al. 2012); although it is not clear exactly why.

² Although countries may have access the same global scientific knowledge base, as published in international scientific journals, nevertheless countries may look for different answers to different questions and they may interrogate different evidence bases (Millstone et al. 2004; Millstone 2009), and the databases used to make regulation policy may be proprietary and hence confidential (Myers et al. 2016). This would further dilute any relationship between scientific evidence and policymaking.

³ ‘As scientists become increasingly convinced that the activity is harmful, the industry first devotes more and more resources to falsely reassuring the citizens. This yields increasingly large welfare losses. When scientists’ belief reaches a critical threshold, however, countering the scientific consensus becomes too costly and the industry abruptly ceases its miscommunication.’ (Orset and Yann 2018, p120).

⁴ For example, Koch-financed activists of local chapters of the group ‘Americans for Prosperity’ knock on the doors of selected individuals to mobilise local opposition to public transport projects such as light-rail trains and bus routes (see https://www.nytimes.com/2018/06/19/climate/koch-brothers-public-transit.html).

⁵ See https://en.wikipedia.org/wiki/Waste_Electrical_and_Electronic_Equipment_Directive [accessed 26 July 2016].

⁶ Those 6 countries are Colombia, Bermuda, El Salvador, France, the Netherlands and Sri Lanka (see https://en.wikipedia.org/wiki/Glyphosate [accessed 22 July 2016]).

⁷ Those countries are: Canada, Italy, France, Germany and Switzerland introduced restrictions on neonicotinoids. See https://en.wikipedia.org/wiki/Neonicotinoid [accessed 31 October 2016].

⁸ For example, only 12 distinct countries, mainly in Africa, have banned (types of) Paraquat: http://www.pic.int/Procedures/NotificationsofFinalRegulatoryActions/Database/tabid/1368/language/en-US/Default.aspx.

⁹ The website of the Federation of British Historic Vehicle Clubs explains that: ‘The withdrawal of lead from petrol raised very real concerns about engine damage from exhaust valve seat recession (VSR) in older engines with cast-iron cylinder blocks and heads … the Federation lobbied successfully to secure an EU concession for the sale of leaded petrol in the UK, a concession which survives to this day, although current sales outlets are few in number, and the uptake of the product is quite small.’ http://fbhvc.co.uk/legislation-and-fuels/fuel-information/[accessed 25 October 2016].

¹⁰ Van den Borre and Deboosere (2014) write that mesothelioma has an average latency period of 37–45 years.

¹¹ http://www.asbestosnation.org/facts/asbestos-bans-around-the-world/.

¹² http://ibasecretariat.org/asbestos_ban_list.php.

¹³ It should be noted that earlier ban on DDT were mostly limited to specific uses (e.g. agriculture). Bans on all uses of DDT were introduced in the early 2000s (see Figure 1).

¹⁴ https://en.wikipedia.org/wiki/Smoking_ban [last accessed 6 November 2017].

¹⁵ http://news.bbc.co.uk/2/hi/uk_news/8,197,875.stm [last accessed 6 November 2017].

¹⁶ We thank an anonymous reviewer for this suggestion.

¹⁷ To be precise, we use the variable cwtfp which indicates the welfare relevant TFP level, and which compares living standards across countries in each year.

¹⁸ https://info.worldbank.org/governance/wgi/.

¹⁹ The loadings of the six variables onto this PCA-generated component are as follows: Rule of Law 0.4335; Political Stability and No Violence 0.3619; Voice and Accountability 0.3868; Government Effectiveness 0.4240; Regulatory Quality 0.4153; and Control of Corruption 0.4234.

²⁰ Data are from OECD Environment Statistics (https://stats.oecd.org/index.aspx?queryid=29068). Indicator code: ENV_TECH: ‘Selected environment-related technologies’.

²¹ In a previous version of the manuscript, we considered the number of patent applications per capita retrieved from the OECD STAT database. We thank the reviewer for suggesting the focus on a technology-specific variable as green patents.

²² See the Online Supplementary Materials.

²³ Data from https://apps.who.int/gho/data/view.main.14110. This robustness analysis is not reported here, because the number of observations was rather low, and the results were deemed unreliable.

²⁴ For a full list see the Online Supplementary Materials – Appendix A.

²⁵ Results are in .

²⁶ Plastic bag bans have boomed recently: countries banning them are 54 in 2019.

²⁷ Sweden also scores very highly in the Environmental Regulatory Regime Index in Esty and Porter (2001).

²⁸ There are only 18 observations when Plastic Bags is included alongside the five other cases.

²⁹ See https://www.stata.com/manuals13/mvpcapostestimation.pdf.

³⁰ https://www.stata.com/statalist/archive/2002-06/msg00131.html.

³¹ E.g. for INSTITUTIONS and GREEN_PATENT_PC, these variables are calculated for the best available year, which is 1996 in the cases of asbestos, leaded petrol, and seatbelt, and 1998 for smoking bans. See Table notes for details.

³² Sometimes log of GDP per capita is weakly associated with later bans for leaded petrol and DDT, for models that include the INSTITUTIONS score. This could be due to multicollinearity of log of GDP per capita with the INSTITUTIONS score variable.

³³ Coefficients are taken from the second of the three regression specifications. The standard deviation of INSTITUTIONS fluctuates across years around the value of 2.3 (2.296 in 1996, 2.281 in 1998, and 2.313 in 2000). The effect size is 2.3 × 4.121 = 9.5 years for asbestos, 2.3 × 1.446 = 3.3 years for leaded petrol, 2.3 × 0.452 = 1.0 years for DDT, 2.3 × 4.960 = 11.4 years for the seatbelt obligation.

³⁴ LAD standard errors are estimated using 1000 bootstrap replications.

³⁵ Each of the six components was associated with the year of ban in some, but never all, of the six cases (asbestos, leaded petrol, etc). Results not shown here.

³⁶ Interestingly, Needleman (2000, p26) describes how General Motors first liquidated its share of the top lead additive firm, Ethyl, before ‘betraying’ the buyers, by making a strategic U-turn and advocating against the lead additive business in order to boost its new product range that included catalytic converters.

³⁷ Results not reported here. Available upon request.

³⁸ Evidence is beginning to emerge about the harmful effects of shale gas extraction on human health (e.g. Eleaine. L 2018). Shale gas also produces huge amounts of radioactive waste, although this is not well-known – even the truck drivers disposing of this radioactive waste may not be aware that their truckload is radioactive. See:

https://www.rollingstone.com/politics/politics-features/oil-gas-fracking-radioactive-investigation-937389/

³⁹ http://www.world-nuclear.org/information-library/country-profiles/countries-a-f/france.aspx [accessed 28 October 2016].

⁴⁰ EKC suggests that environmental degradation is an acceptable by-product of economic growth, which will eventually fade as rising income levels deliver stronger regulatory institutions and better environmental standards.

⁴¹ http://ec.europa.eu/growth/industry/innovation/facts-figures/scoreboards_en.

⁴² https://en.wikipedia.org/wiki/List_of_smoking_bans [accessed 22/07/2016].

⁴³ One possibility could be that NSI characteristics (such as a country’s sectoral specialisation) could be more influential for product-related bans (e.g. bans of Asbestos) rather than other bans (such as bans on how products are used, e.g. the indoor smoking ban, or bans on behaviours, e.g. the seatbelt obligation). We are grateful to an anonymous reviewer for this suggestion.