Reducing Environmental Risks by Information Disclosure: Evidence in Residential Lead Paint Disclosure Rule

Abstract

Recently, there has been a surge in environmental regulations that require information disclosure. However, existing empirical evidence is limited to certain applications and has yet to generalize the effectiveness of this approach as a policy strategy to reduce environmental risks. This study evaluates the disclosure rule of the residential lead paint hazard (Title X) introduced in 1996. This regulation is one of the most prominent environmental disclosure laws, but its effectiveness has been relatively under-investigated. Title X was intended to induce information recipients' risk prevention behavior by proclaiming lead paint risk in old homes. Specifically, this study assumed three types of behavioral changes could be induced by Title X-(1) testing for lead paint, (2) maintaining painted surfaces in a proper condition, and (3) switching buying choice from old houses to new houses. In addition, using the national American Housing Survey, this study examined whether Title X increased the occurrence of those three behaviors. The results show that Title X increased the probability of homebuyers' lead testing and decreased the probability of the existence of peeling paint in old homes. The analyses on households' buying choices found that Title X did not result in a substantial switch from old houses to new houses in any socioeconomic status groups. However, it was found that the policy reduced the instances of households with young children occupying old homes. The findings in this study indicate that the policy generally induced more risk management behavior on existing risks and greatly influenced families with young children to such an extent that they changed their buying choice. C 2012 by the Association for Public Policy Analysis and Management.

The value of a healthy home: Lead paint remediation and housing values

“…Disclosure of lead hazards occurs at the time a home is under contract for purchase and may not be known during the initial home search. Recent research does not nd an impact of the Title X disclosure law on housing prices (Bae 2016, Zhao 2016), but Bae (2012) nds an increase in the probability that a homebuyer has a property tested for lead and Zhao (2016) nds that Title X lead disclosure laws are associated with families relocating to new homes, greater lead mitigation and reductions in blood lead levels among children in rental properties.…”

How Managers Can Reduce Household Water Use Through Communication: A Field Experiment

“…The success of behavioral interventions ranges from increasing college enrollment among graduating seniors (Oreopoulos & Ford, 2019) and reducing homelessness via short‐term rent subsidies (Gubits et al., 2018) to reducing the risk of lead paint exposure among children (Bae, 2012) and the promotion of energy savings through implementation of “smart” thermostat technologies (Harding & Lamarche, 2016). Reviews of hundreds of interventions in the health (Byerly et al., 2018) and pro‐environmental behavior domains (Vlaev et al., 2016) point to the importance of such interventions in changing behavior.…”

An Examination of Seven Sociopolitical Factors and Their Connection with State Environmental Expenditures

“…The underlying hypothesis being that those businesses or states with significant environmental quality problems will, under pressure from stakeholders, tend to be more assertive in addressing those issues (Ellison & Newmark 2010;Reimer et al, 2013). Some studies support this correlation (e.g., Patten, 1998;Bae, 2012), while data from others suggest different results (Freedman & Patten, 2004;Connors et al, 2013).…”